getting a dealers license

[burnham]

I've thought about buying and selling some bikes for a while, I would like to be able to do it without getting fucked on the sales taxes. Anyone here go about becoming a dealer? I'm wondering what sort of hoops I would have to jump through, and what sort of costs are involved. I might buy and sell a few bikes a year if it worked out, not looking to get rich or quit my job.

[aldend123]

I looked in to it a few years ago, and the biggest issue that stood out for me was the $25k bond.

(1) The person shall obtain a bond, or equivalent proof of financial responsibility as described in paragraph (5), and continue in effect a surety bond or other equivalent proof of financial responsibility satisfactory to the municipal licensing authority in the amount of $25,000 executed by a surety company authorized by the insurance department to transact business in the commonwealth. The bond or its equivalent shall be for the benefit of a person who purchases a vehicle from a Class 2 licensee, and who suffers loss on account of:- (Scenarios follow, see full text)

http://www.massrmv.com/rmv/dealer/Ch..._Licensing.htm

And while I don't have a source handy, I'm pretty sure you had to have a dedicated place of business to register to. You couldn't register the business to your home, and call that a dealership. Something tells me there are ways around this though.

[pasta-rocket]

I am a dealer out of my house but i used the garage as my square footage for the buiss. It took me about 6 months getting town approval, paperwork complete and state approval. the insurance bond is about 187.00 per year for a 25k bond.

[jwm2k3]

Getting a dealer license in MA is next to impossible.

Having said that, MOST bike re-sellers are just buying bikes and leaving the titles open on the back....and reassigning to next owner. No license, no taxes, no reported income.

[Tunertype]

Getting a dealer license in MA is next to impossible.

Having said that, MOST bike re-sellers are just buying bikes and leaving the titles open on the back....and reassigning to next owner. No license, no taxes, no reported income.

You mean tax evasion. It's always a good idea.

It's not that hard, but you do need to be an actual dealer not trying to get it for the plates or access to auctions. Technically using dealer plates for personal use is also illegal even if you are a dealer. The requirements are pretty simple, you need an approved place of business and to have sold enough vehicles to qualify.

http://www.massrmv.com/rmv/dealer/Ch....htm#section58

[e30addict]

You mean tax evasion. It's always a good idea.

Nevermind the minor detail of selling something you don't technically own. Things COULD get ugly pretty quick if you take this route. Lot of liability with this route. "Is your house worth it?" is the question I asked myself when I thought about flipping stuff this way.

[Tunertype]

Also if you do it the other honest way you don't have to pay sales tax, but you do have to pay capital gains on any profit. So trade 6% on the purchase price for 30% on the profit. You can run smaller margins and still make money, but on bigger margin deals you lose out.

[burnham]

Thanks guys. Looks like it may be more of a pain in the ass than I am up for.

[DynoTune]

we have a dealer license... the insurance is about $2500/year... yes, its all a pain in the butt... buy my shop that is currently for sale and you get the dealer license

[whynot]

...and the town building inspector may drop in now and then, and the fire department inspector, too, then there's a probably a town permit required to store gasoline and oil ... and getting a sales tax number and filing sales tax reports, and ...

[THE STUFF 187]

I have done it both ways & dealing with the town in a pain in the ass. For a few bikes just buy bikes & leave back of title open. You will sell from previous owner to the guy you are selling to. This way you avoid all the town & bond stuff & taxes.