Who Needs an Indiana Going Out of Business Sale Bond?

According to Indiana state law (IC 25-18-1), any business conducting a Going Out of Business Sale must obtain both a GOB permit and a surety bond before advertising or selling merchandise under this designation. This applies to:

• Retail stores liquidating inventory

• Businesses permanently closing operations

• Companies selling remaining stock due to bankruptcy

• Any store advertising a "Going Out of Business," "Liquidation," "Final Sale," or similar event

This bond protects consumers by ensuring that the sale is legitimate and follows Indiana’s business closure regulations.

How Does the Indiana Going Out of Business Sale Bond Work?

The GOB bond guarantees that the business conducts its sale fairly and legally. Here’s how it works:

1. You obtain the bond before applying for a Going Out of Business Sale permit.

2. The bond serves as a financial guarantee that you will follow state laws regarding liquidation sales.

3. If a violation occurs, such as false advertising, failing to sell only pre-listed inventory, or extending the sale beyond legal limits, a claim can be filed against the bond.

4. If a claim is paid, the surety company may cover damages up to the bond limit, but you are ultimately responsible for repaying any amounts covered.

Cost of an Indiana Going Out of Business Sale Bond

The bond amount is determined by Indiana’s licensing authority and varies based on the nature and size of your business. The cost to obtain the bond depends on:

• The required bond amount (set by the local government)

• Your business’s financial history and credit score

• The surety company’s underwriting process

Typically, the bond premium ranges from 1% to 5% of the bond amount. Well-qualified applicants pay lower rates, while those with credit challenges may face slightly higher premiums.

How to Obtain an Indiana Going Out of Business Sale Bond

The process is simple and straightforward:

1. Verify the bond amount – Check with your local city or county office for specific bonding requirements.

2. Request a quote – Provide details about your business and sale to get pricing.

3. Submit your application – Complete the required paperwork and supporting documents.

4. Receive your bond – Once approved, you’ll receive the bond to submit with your GOB sale permit application.