The short answer
As far as we know, most states have no license that is specific to estate sale companies. What applies instead is ordinary business registration: a registered business, a tax identification number, whatever seller's permit the state uses to collect sales tax on goods, and in some cities a local business license. Where a company sells by auction rather than at tagged prices, many states license auctioneers, and that license usually belongs to the person calling the bids. A few kinds of property, firearms and vehicles above all, carry their own rules whatever the state.
Insurance is a different question. Almost nowhere requires an estate sale company to carry it, and almost every company that lasts does, because the business consists of inviting the public into a stranger's house and handling that stranger's possessions. General liability is the floor. Cover for property in your care, workers' compensation once you have staff, and commercial auto for the van are the next three, in roughly that order.
Rules vary by state, by county and by city, they change, and this is general guidance rather than legal advice. Before you rely on anything here, look at your own state's page, for example Texas or South Carolina, which says what we know and links to the state's business register, and then spend an hour with an attorney and an insurance agent in your own state. Both will cost less than the first claim.
Business registration: the part that is actually required
Whatever the state, a company that takes money on someone else's behalf should exist as a business before it does so. In general terms that means the following, and an accountant in your state will tell you which of them applies to you and in what order.
- A registered entity. Many operators form a limited liability company or a corporation so that a claim arising from a sale is a claim against the business rather than against their own home. Some start as sole proprietors with a registered trade name. The choice has tax consequences, which is why it is a question for a professional and not for a guide.
- A federal employer identification number, which you will need to open a business bank account and to hire anyone.
- A seller's permit or sales tax registration, where the state requires one to collect tax on goods sold. Whether an estate sale is taxable, who owes the tax, and whether an occasional sale of a household's own goods is treated differently from a company's regular trade all depend on the state. Do not guess. The answer belongs in your contract and in your checkout from the first sale.
- A local business license, in the cities and counties that require one for any business operating in their limits. Some also require a permit for a sale held at a residence or for signs on public property; our guide to permits, signs and local rules covers how to check a city in ten minutes.
None of this is a credential. Registration proves that a business exists and pays its taxes, not that it knows what a piece of furniture is worth or that it will pay a family on time. That distinction matters later in this guide, because it is the difference between what you may honestly claim and what you may not.
Auctions, firearms and vehicles: the special cases
Three activities that look like part of an ordinary estate sale are regulated on their own, and a company that drifts into them without checking can find itself outside the law without meaning to be.
Selling by auction. Many states license auctioneers and some license auction companies as well, with an exam, a bond and continuing education. If you call live bids, or run online auctions with a soft close in a state that treats those the same way, the rule may apply to you. A tagged-price sale is generally not an auction. The state pages say where an auctioneer license was confirmed to us and where we are not sure, and our guide to adding online auctions to an estate sale business covers the rest.
Firearms. Dealing in firearms is regulated federally, and many states add rules of their own about transfers and private sales. Most estate sale companies do not sell guns at all, and refer the family to a licensed dealer instead. That is the safe default; the guide to selling firearms from an estate explains why and what the lawful routes look like.
Vehicles. Many states limit how many vehicles a person or business may sell in a year before a dealer license is needed, and a title has to be transferred correctly from an estate. A company that sells the occasional car on the family's behalf should know its state's threshold and how the title transfer works; see selling a car from an estate.
In every one of these cases the honest sentence is the same: rules vary by state, we cannot state yours, and an attorney can.
Insurance: what is wise, in order
Very little insurance is required of an estate sale company by law. Nearly all of it is wise, and a family that has read any guide to hiring a company will ask about it. The table below is the usual list, in the order most operators buy it. Premiums depend on your state, your turnover and your claims history, and an agent who has written policies for the trade before is worth finding.
| Cover | What it does | Who needs it |
|---|---|---|
| General liability | Pays when a shopper is hurt on the premises or someone's property is damaged during a sale you are running | Every company, before the first sale |
| Property in your care (often called care, custody and control, or bailee cover) | Pays when a client's belongings are damaged, lost or stolen while you are handling them; general liability commonly excludes exactly this | Every company; ask specifically whether your policy has it |
| Workers' compensation | Pays for a staff member's injury on the job; many states require it once you have employees, and the threshold varies | Any company with staff; ask about contractors too |
| Commercial auto | Covers the van and anyone driving it for the business; a personal policy may not | Any company that moves goods |
| Fidelity or theft bond | Pays a client if an employee steals from the estate | Wise once you have a crew; some clients ask for it |
| Umbrella | Extends the limits of the policies above | Larger companies and those handling high-value estates |
Two points to press your agent on. The exclusion for property in your care is the one that surprises companies: a policy that pays for a shopper's broken ankle may pay nothing for the client's sideboard your crew dropped. And a low limit is a policy that runs out mid-claim; ask what the next tier costs, because the difference is usually smaller than you expect.
Read your own certificate before a family does
A certificate of insurance lists the policies, their limits, their dates and the insurer. Families are being told, in guides like ours, to ask for it and to call the insurer named on it. Know what yours says, keep a current copy in the folder you bring to every walk-through, and set a reminder for the renewal date, because a lapsed certificate handed to a client is worse than none.
Bonding, and what the word actually means
"Bonded" is the word companies print most and understand least. A surety bond is a guarantee, bought from a bonding company, that a client will be paid up to the bond amount if you fail to do what you contracted to do or if your staff steal from them. It is not insurance for you; it is a promise to the client, and the bonding company will come to you to recover what it paid. Some states require a bond as part of an auctioneer license. Almost none require it of a tagged-price estate sale company.
That makes it optional, and it makes it a claim you must be able to back. If you say you are bonded, a family is entitled to ask for the bond number and the surety, and to call. If you are not bonded, do not print the word. A fidelity policy is not a bond, an LLC is not a bond, and "bonded" on a business card that means nothing is exactly the kind of claim that ends a relationship the moment an attorney for the estate asks about it.
Presenting it to families honestly
Here is the position a company is really in. Nobody checks estate sale companies. There is no national register, most states have nothing to register in, and the families hiring you have no practical way to confirm anything except by asking you for documents and making a phone call. That means every claim you make about yourself is your word, and it is being made to a person who may have buried a parent last week and is deciding whether to let strangers into the house.
On this site, for that reason, what a company says about its insurance, its licensing and its years in business is published on its profile attributed to the company, in the company's own words, and the family is told the site does not check it. Families are then told what to ask: for the certificate of insurance, for the auctioneer license number where one applies, and for the state's business register entry, which they can look up themselves. Our guides to what to ask about a company's insurance and questions to ask an estate sale company are what the family on the other side of the table has read, and the best way to prepare for the conversation is to read them yourself.
Presenting yourself honestly is simple, and it separates you from the company down the road whose website says things it cannot show.
- Say what is true, specifically. "We carry general liability and cover for property in our care with such-and-such insurer, and here is the certificate" is a sentence a family can check in one call. A two-word badge is not.
- Hand over the documents before you are asked. The certificate, the business registration, the auctioneer license if you hold one, in the folder, at the walk-through. A company that produces them unprompted has nothing to hide and looks it.
- Never imply that anyone has approved you. Listing on a directory, membership of an association, a good review site score: none of these is a check, and none should be described as one.
- Do not claim a license that does not exist. If your state has no estate sale license, "licensed" means your business license, and you should say so. Families are starting to look this up.
- Put it in the contract. A clause stating the insurance you carry, with the insurer and the limits, turns a claim into a term you are bound by, and it is what a careful family's attorney will look for. The guide to what to put in your contract shows where it goes.
A false claim is a different kind of problem than no claim
A company that carries no insurance and says so is a company a family can choose or refuse with open eyes. A company that says it is insured and is not has told a bereaved family something untrue to get into their house, and if a shopper is hurt or a ring goes missing, that is the fact an attorney will lead with. There is no version of this trade in which the badge is worth that.
Keeping it current
Licenses and policies expire, and the failure mode is silent: the certificate in the folder is a year old and nobody noticed. Put the renewal dates for every registration, permit, license and policy in one calendar with a reminder a month ahead. When you add a staff member, ask your agent whether workers' compensation now applies. When you add online auctions, ask whether your state's auctioneer rule does. When you buy a second van, add it to the policy that week. And update your profile here and everywhere else you have described yourself whenever any of it changes, because a claim that was true when you wrote it and is not true now is not a claim you can defend.
What to do next
Look up your state's page, check its business register for your own entry, and book an hour with an insurance agent to go through the table above. Then read how to start an estate sale business if you are at the beginning, or liability and safety at an estate sale if you are already running them, because the cheapest claim is the one that never happens. When your documents are in order, list your company free, state your insurance in your own words on your profile, and be ready to hand over the certificate when a family who has described an estate asks for it.
Frequently asked questions
Do estate sale companies need to be licensed?
In most states, as far as we know, there is no license specific to estate sale companies; ordinary business registration applies, and some cities require a local business license. Companies that sell by auction may need an auctioneer license, and firearms and vehicles carry rules of their own. Rules vary by state, so check your state's page and ask an attorney; this is not legal advice.
What insurance does an estate sale business need?
General liability first, then cover for clients' property in your care, which general liability often excludes. Workers' compensation once you have staff, commercial auto for the van, and a fidelity bond or umbrella as the company grows. Almost none of it is legally required; nearly all of it is what a careful family will ask about.
What does it mean for an estate sale company to be bonded?
A surety bond is a guarantee, bought from a bonding company, that a client will be paid up to the bond amount if the company fails to perform or its staff steal. It is a promise to the client, not insurance for the company. Few states require it of a tagged-price estate sale company, so if you print the word, be able to give a family the bond number and the surety.
Does an estate sale company need a sales tax permit?
It depends on the state. Some require any business selling goods to register and collect sales tax; others treat sales of a household's own used goods differently. Ask an accountant in your state before your first sale and build the answer into your contract and your checkout, because it is not a question to settle at settlement.
How can a family check whether an estate sale company is really insured?
By asking the company for its certificate of insurance and calling the insurer named on it to confirm the policy is in force. A business registration can be looked up in the state's business register, and an auctioneer license with the state board. Nothing else, including a listing on a website or a badge on a card, is a check, and companies should expect families to do this.