How to Get a Dealer License in South Dakota
In South Dakota, dealer licensing runs through the South Dakota Department of Revenue, Motor Vehicle Division — Office of Dealer Licensing. To get a used car dealer license in South Dakota you'll need a registered business, a compliant location, a $25,000 surety bond, and the fees below. Whether you're opening a car lot, going wholesale-only, or starting a buy-here-pay-here operation, this guide walks the South Dakota auto dealer license requirements, real costs, and the exact steps — in plain English. Rules change, so verify everything against the South Dakota Department of Revenue, Motor Vehicle Division — Office of Dealer Licensing's current pages before you file.
- Surety bond
- $25,000
- License term
- The paper dealer license is issued for a five-year period, but a renewal application and fee are due every year, filed online in the 605Drive DMV Dealer System. Dealer plates renew at the same time.
- Sales threshold
- Selling 5 or more vehicles or boats in a 12-month period requires a license (SDCL 32-6B-5). The travel-trailer threshold is lower — 3 in twelve months. Being licensed as a dealer in another state or holding yourself out as being in the business triggers licensing at any volume.
- Pre-licensing
- None. South Dakota has no pre-licensing course or exam — the gating step is instead a mandatory dealer-inspector premises inspection and certification.
License types in South Dakota
| License type | What it covers |
|---|---|
| Vehicle Dealer / Used Car Dealer | New and used cars, trucks, and vans under one license — South Dakota has no separate used-only or standalone wholesale license. |
| Motorcycle / Off-Road Vehicle Dealer | Motorcycles and off-road vehicles; lower fee and $5,000 bond tier. |
| Mobile / Manufactured Home Dealer | Manufactured and mobile homes; $25,000 bond tier. |
| Trailer / Boat / Snowmobile Dealer | Trailers, boats, and snowmobiles licensed by asset type with their own lower bond and plate fees. |
What it costs
| Item | Cost | Notes |
|---|---|---|
| Vehicle/Used Car Dealer license fee | $300 initial / $175 renewal | Annual renewal fee; other asset types have their own fee schedule |
| Dealer '77' plates | $101 per set / year | For dealer-owned inventory driven on the road; renewed with the license, prorated mid-term |
| Surety bond premium | Varies | Fraction of the $25,000 face value, set by the surety based on credit |
| Public liability insurance | $300,000 minimum | Required coverage (not a state fee) for vehicle, used-vehicle, and motorcycle dealers |
| Title fee | $10 | Per vehicle at titling |
Step by step
- Secure a compliant physical location in South Dakota (permanent enclosed building, sign, 20 hrs/week, 5-vehicle display lot).
- Obtain a $25,000 surety bond from a bonding company qualified in South Dakota.
- Obtain $300,000 public liability insurance and proof of coverage.
- Contact your regional Motor Vehicle Dealer Agent and complete the Dealer License Application with bond, insurance, and business documents.
- Pass the dealer-inspector inspection certifying the premises comply.
- Pay the $300 license fee, buy dealer '77' plates ($101/set), and get set up in 605Drive to issue permits — then renew annually.
Premises & temp tags
Location: You need an enclosed permanent building located in South Dakota — heated, lit, and accessible; a tent, temporary stand, or temporary quarters will not qualify. The dealership must be open at least 20 hours a week between 8 a.m. and 8 p.m., post its hours and phone number at the entrance, carry a permanently affixed exterior sign legible from the road, and have a display area for 5 or more vehicles. A dealer inspector must inspect and certify the location before the license is issued.
Temp tags / plates: On each retail sale the dealer issues a temporary 'sold permit' (white), valid no more than 45 days, generated inside the state's 605Drive dealer system and signed by a Dealer Agent to be valid — permits issued outside 605Drive are invalid. Dealer '77' plates go on driven inventory, and blue demonstration/in-transit plates cover demos and transport.
South Dakota-specific things to know
- South Dakota has no state income tax and no standard sales tax on vehicles — a 4% motor vehicle excise tax (SDCL 32-5B-1) is charged at titling instead, calculated on the purchase price rather than a sales-tax line.
- The '5-year license, annual renewal' split trips up dealers — the certificate runs five years, but miss the yearly renewal application and fee and you lapse anyway.
- Everything runs through the 605Drive dealer system: temporary sold permits and renewals are mandated there, and permits not issued (or unsigned by a Dealer Agent) in the system are invalid dealer violations.
- Real premises are strictly enforced — no tents or temporary stands, 20 hours a week staffed, and an in-person dealer-inspector certification before licensure, which 'home/curbstone' operations fail.
Official South Dakota resources
- SD DOR — Dealer Vehicle Licenses ↗
- SD DOR — Dealer Requirements & License Plates ↗
- SD Dealer Statutes (SDCL Ch. 32-6B) ↗
South Dakota dealer license FAQ
How much does a dealer license cost in South Dakota?+
Vehicle/Used Car Dealer license fee: $300 initial / $175 renewal; Dealer '77' plates: $101 per set / year; Surety bond premium: Varies; Public liability insurance: $300,000 minimum; Title fee: $10. Plus the $25,000 surety bond (you pay a small annual premium on that, not the full amount).
How big is the dealer bond in South Dakota?+
South Dakota requires a $25,000 surety bond. Set by statute SDCL 32-6B-7 for a Vehicle/Used Car Dealer (also $25,000 for mobile/manufactured homes). Must be issued by a bonding company qualified in South Dakota. Lower tiers apply to other asset types (boats $20,000; trailers over 3,000 lbs $10,000; motorcycle/off-road and snowmobile $5,000).
Do you need a physical lot to get a dealer license in South Dakota?+
You need an enclosed permanent building located in South Dakota — heated, lit, and accessible; a tent, temporary stand, or temporary quarters will not qualify. The dealership must be open at least 20 hours a week between 8 a.m. and 8 p.m., post its hours and phone number at the entrance, carry a permanently affixed exterior sign legible from the road, and have a display area for 5 or more vehicles. A dealer inspector must inspect and certify the location before the license is issued.
How many cars can you sell in South Dakota without a dealer license?+
Selling 5 or more vehicles or boats in a 12-month period requires a license (SDCL 32-6B-5). The travel-trailer threshold is lower — 3 in twelve months. Being licensed as a dealer in another state or holding yourself out as being in the business triggers licensing at any volume.
How long is a South Dakota dealer license valid?+
The paper dealer license is issued for a five-year period, but a renewal application and fee are due every year, filed online in the 605Drive DMV Dealer System. Dealer plates renew at the same time.
Is dealer training or an exam required in South Dakota?+
None. South Dakota has no pre-licensing course or exam — the gating step is instead a mandatory dealer-inspector premises inspection and certification.
How do temporary tags work for South Dakota dealers?+
On each retail sale the dealer issues a temporary 'sold permit' (white), valid no more than 45 days, generated inside the state's 605Drive dealer system and signed by a Dealer Agent to be valid — permits issued outside 605Drive are invalid. Dealer '77' plates go on driven inventory, and blue demonstration/in-transit plates cover demos and transport.
Data verified 2026-07-17. Requirements change — confirm with the South Dakota Department of Revenue, Motor Vehicle Division — Office of Dealer Licensing before filing.
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