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WHAT IS A PRIVILEGE LICENSE?
A privilege license is a license requirement of every person, firm,company 
or corporation engaged in any business, vocation, occupation or profession 
described in Title 40, Chapter 12, Code of Alabama 1975.

WHEN IS THE LICENSE DUE?
The annual license covers the period of October 1 through September 30. The
license will be delinquent on November 1.

WHERE DO I BUY THE LICENSE?
The State and County license(s) is issued by the county Probate Judge or 
License Commissioner in the county where the business is located. Unless 
otherwise provided, a license is required in every county where the business
is conducted. 

DO I NEED A CITY LICENSE?
The Alabama Department of Revenue does not administer municipal licenses. 
You should check with every city office where you are conducting business 
to verify what licenses are required prior to transacting business.

WHAT LICENSES AND PERMITS ARE NECESSARY AND WHAT ARE THE FEES?
City and County officials will determine what local licenses and permits 
are necessary. A variety of business privilege licenses are administered 
by the Alabama Department of Revenue which affect proprietorships, 
partnerships, and corporations as well as certain professions. Fees vary 
dependent upon the type of license required, and, in some cases, upon the 
population of the area where the business is located or upon the volume 
of business. It is important to be aware that one business may require 
several different types of business privilege licenses depending upon 
the services offered or products sold by the business.

HOW DO I BECOME AN AUTOMOBILE DEALER?
Alabama law has a regulatory license requirement prior to the issuance 
of an automobile dealers privilege license. An application form must be 
completed and accompanied by a $25,000 surety bond for new car dealers 
and a $10,000 surety bond for used car dealers, wholesalers, rebuilders 
and/or reconditioners. Proof of issuance of your regulatory license to 
the county will enable you to purchase an automobile dealers license. 
The cost of the privilege license is based upon the city population.

HOW MUCH DOES A REGULATORY LICENSE COST? 
The automobile regulatory license has four (4) categories for 
licensing: 1) new auto dealer OR used auto dealer, 2) wholesaler, 
3) rebuilder and/or 4) reconditioner. Each category costs $10 per year.
There is a $5 fee for each additional location of business.

WHAT IS THE DIFFERENCE BETWEEN A RETAIL AUTO DEALER AND WHOLESALE 
AUTO DEALER? 
A retail dealer can sell to the public and is required to collect 
applicable sales tax. Accordingly, a sales tax number is required 
in the legal name of the business prior to the issuance of the 
regulatory license. A wholesale auto dealer sells autos to other 
auto dealers only and is not required to have a sales tax number. 

WHAT IS THE DIFFERENCE BETWEEN A REBUILDER AND A RECONDITIONER? 
A rebuilder engages in the business of making extensive repairs, replacements
 or combination of different motor vehicles to the extent that the finished 
motor vehicle must be assigned a new identification number. A reconditioner 
engages in the business of refurnishing and repairing damaged motor vehicle 
parts to the vehicle for resale under the same identification number.

HOW MANY CARS CAN BE SOLD AT RETAIL PRIOR TO THE REQUIREMENT OF AN AUTOMOBILE 
DEALERS LICENSE? 
The law states that any person, firm or corporation negotiating the sale of 
five (5) or more motor vehicles at retail during a calendar year shall be 
defined as a Used Motor Vehicle Dealer and will be required to comply with 
applicable statutes.

HOW DO I BECOME A DISMANTLER? 
A regulatory license which requires a $10,000 surety bond is required of a 
dismantler prior to the issuance of an automobile dealers privilege license. 
The total cost of this regulatory license is $226. For list of other licenses
and exemptions click here.

WHERE DO I OBTAIN REGULATORY LICENSE INFORMATION? 
Regulatory license information and applications can be obtained by calling 
(334) 353-7827 or writing the Alabama Department of Revenue, Sales, Use & 
Business Tax Division, Severance & License Section, P. O. Box 327550, 
Montgomery, Alabama 36132-7550. The physical location of the office is 3103 
Gordon Persons Building, 50 Ripley Street, Montgomery, Alabama. The regulatory 
licenses are issued by this office.
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