Who requires it
Tennessee Motor Vehicle Commission
Auto dealer · Tennessee
Tennessee Motor Vehicle Dealer Bond
Tennessee motor vehicle dealers must keep a surety bond of at least $50,000 on file with the Motor Vehicle Commission while licensed. Form IN-1316 is the Commission’s Motor Vehicle Dealer Bond; statute rejects a letter of credit as a substitute for that bond.
Common bond amount
$50,000
Statutory minimum under § 55-17-111(g); Form IN-1316. Letter of credit is not accepted in place of this bond.
How you file
File Form IN-1316 with the Motor Vehicle Commission
Renewal
Show a qualifying bond at each license or renewal; continue with an updated bond as needed
Who requires it
Applicants and renewing licensees for motor vehicle dealer credentials under T.C.A. § 55-17-111(g), including dealers whose principal business is selling motor vehicles as defined in § 55-17-102(17). Automobile auctions have a parallel $50,000 surety bond requirement under § 55-17-111(d) on Commission forms. Recreational vehicle dealer licensing is handled through the same Commission program family—confirm the exact form and citation in your CORE packet. Salesperson licenses are separate and are not covered by this dealer bond guide.
How much is required
T.C.A. § 55-17-111(g) establishes a fixed floor of at least $50,000. Form IN-1316 is written for that fifty-thousand-dollar amount and names the Commission, the State, and other persons who suffer covered losses under the statute.
How to get and file it
Have a Tennessee-authorized surety company complete Form IN-1316 for the exact dealer name and physical address on the license application, attach power of attorney, and obtain the dealer’s signature (both partners when the applicant is a partnership). Deliver the original with the dealer application through CORE as the Commission directs. Do not substitute a letter of credit for this dealer bond. The bond supports the dealer license term shown on the form and may continue with an updated bond or continuation certificate for later periods. Renewals must again show a qualifying surety bond in force. Keep the bond alive for the entire active license period; gaps can stop licensing. Claims on the bond generally must be brought within two years.
Cost note
$50,000 is the required bond amount, not the premium you pay. See bond amount vs premium. Bond amount vs premium →
Requirement checklist
- Required amount
- At least $50,000 surety bond
- Form
- MVC Form IN-1316 — Motor Vehicle Dealer Bond
- Name / address match
- Exact licensed entity name and physical address on the application
- Not accepted
- Letter of credit as a substitute for the dealer bond under § 55-17-111(g)
Official sources
Frequently asked questions
Can I use a letter of credit instead of the dealer bond?
No for motor vehicle dealers under § 55-17-111(g). Statute says a letter of credit is not satisfactory evidence of the required surety bond.
Do automobile auctions use the same amount?
Auctions also face a $50,000 surety bond on Commission forms under § 55-17-111(d). Use the auction packet’s form rather than assuming every IN-1316 field fits an auction license.
Is this bond in the contractor Board’s home improvement program?
No. Dealer bonding runs through the Motor Vehicle Commission under title 55. Contractor and home improvement bonds run through the Board for Licensing Contractors under title 62.
Related Tennessee bond guides
Home Improvement Contractor Bond
$10,000
In counties that adopted Tennessee’s home improvement law, remodelers working between $3,000 and $24,999 must show $10,000 of financial responsibility to the Board for Licensing Contractors. A surety bond is the usual path; cash, property, or an irrevocable letter of credit can also satisfy the rule.
Collection Service Bond
$15,000–$25,000
Tennessee collection service agencies licensed by the Collection Service Board must keep a surety payable to the State sized by certified employee count—$15,000, $20,000, or $25,000—or assign a certificate of deposit in the same amount.
Surety basics (not repeated here)
Universal surety concepts explained once—linked here instead of repeated on every state or bond page.
Continue with a Tennessee application
Tennessee will be preselected. Choose your bond type in the application—we confirm the correct product against your agency form before anything is issued.
Last verified 2026-08-10. This guide is based on verified educational content and official sources.
Agents Ready to Help
Share your agency checklist or bond form and we will confirm the agency, amount, and filing steps before issuing.
Talk to the pro →