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How to Start a Towing Business in Tennessee

Roadside assistance and vehicle towing for consumers, police rotations, and motor clubs. Here's the Tennessee-specific path — structure, licensing for towing work, taxes, insurance, and landing your first customers.

Tennessee LLC fee
~$300
Formation time
immediate online
Startup range
$25,000–$100,000+
Bond required
typically no

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  1. towing license in Tennessee: do you need one?

    Towing is heavily regulated — state carrier authority, USDOT number, specific insurance types, and often local permits and rate caps for non-consensual tows. In Tennessee, the state board or agency that handles towing licensing is linked below — check it, and your city or county business-license office, before you advertise or take a job. If Tennessee doesn't license towing work at the state level, a local business license (and often liability insurance) is still expected.

    Tennessee professional & occupational licensing ↗

  2. What it costs to start a towing business in Tennessee

    Plan for $25,000–$100,000+ (truck is the big cost) to get operational. On top of that: about $300 to form a Tennessee LLC, then an annual report is due (~$300), a free EIN from the IRS, and general liability insurance — a few hundred dollars a year for most solo operators.

  3. What a towing business needs before day one

    Roadside assistance and vehicle towing for consumers, police rotations, and motor clubs. The parts that actually matter for towing: State tow operator/carrier authority + USDOT, Commercial auto + on-hook + garage-keepers insurance, Tow truck, Motor club and PD rotation contracts, Storage lot.

    Already know enough? Get your Tennessee towing numbers now.See my plan ↑

  4. Form the business in Tennessee

    You can operate as a sole proprietor with no filing, or form an LLC for liability protection — for hands-on towing work most owners choose the LLC. The Tennessee LLC filing fee is about $300 and formation takes immediate online. Then get a free EIN, open a business bank account, and register for Tennessee sales tax if you'll sell taxable goods or services.

    The full Tennessee LLC walkthrough — fees, forms, and steps ↗

  5. What to charge for towing in Tennessee

    Hook fee ($75–$150) plus per-mile ($3–$7), storage per day ($35–$75), plus after-hours, winch-out, and heavy-duty surcharges. Motor-club and PD-rotation rates are set by contract and lower per call. Check what the established towing businesses in your city actually charge before you set your rates — pricing to undercut them is the fastest way to work the first year at a loss.

  6. Getting your first towing customers in Tennessee

    Motor-club vendor applications, police rotation lists, and repair-shop partnerships. Motor-club contracts (AAA, Agero) and police rotation lists provide steady dispatch volume once you qualify. 24/7 and weather-driven — snow, ice, and heat waves cause call surges. Motor-club vendor spots (AAA, Agero) and police rotation lists provide the steady baseline; repair-shop partnerships add private-pay work.

  7. The mistake most first-year towing owners make

    Buying the truck before securing dispatch volume. A tow truck payment with no motor-club contract or rotation-list spot is a fast way to lose money — line up the accounts, then buy the iron.

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Frequently asked

How do I start a towing business in Tennessee?

Confirm the licenses for towing work in Tennessee, pick a structure (sole proprietor or LLC), get a free EIN, register for Tennessee taxes if you'll collect sales tax, open a business bank account, get general liability insurance, then set up your Google Business Profile and line up your first jobs.

Do I need a license for a towing business in Tennessee?

Towing is heavily regulated — state carrier authority, USDOT number, specific insurance types, and often local permits and rate caps for non-consensual tows. Check the Tennessee licensing agency and your local city or county before you advertise.

How much does it cost to start a towing business in Tennessee?

Plan for $25,000–$100,000+ (truck is the big cost), plus about $300 to form a Tennessee LLC. An EIN is free and general liability insurance runs a few hundred dollars a year for most solo operators.

What should I charge for towing in Tennessee?

Hook fee ($75–$150) plus per-mile ($3–$7), storage per day ($35–$75), plus after-hours, winch-out, and heavy-duty surcharges. Motor-club and PD-rotation rates are set by contract and lower per call.

How much do towing businesses make in Tennessee?

It depends on your rates and how booked you stay. See the towing income and pricing breakdown for typical owner take-home and what to charge.

How much does a towing business license cost in Tennessee?

It depends on exactly which towing license or permit applies — a state professional license commonly runs $50–$300 plus any exam or renewal fee, and a local city/county business license is often another $25–$100. That's separate from the ~$300 Tennessee LLC filing fee if you form one. Check the Tennessee licensing agency above, or use the License Finder tool, for the exact fee for towing work.

How much does towing business insurance cost in Tennessee?

General liability insurance for a solo towing operator typically runs $300–$800 a year, more if you carry commercial auto coverage or a higher liability limit. Clients, landlords, and some license boards require proof of coverage before you can start towing work in Tennessee.

Where do the first towing customers come from?

Motor-club vendor applications, police rotation lists, and repair-shop partnerships.

Official sources

Fees and timelines are commonly-cited figures last reviewed September 2026 and can change — always confirm on the official site. This is educational information, not legal or tax advice.

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AI-generated guidance is for educational purposes only and is not legal, tax, or investment advice. Disclosures · Trust center