How to Start a Driving School in Tennessee: A Step-by-Step Guide

Here you’ll learn everything you need to start your Driving School in Tennessee

Compared to many states, Tennessee makes it relatively easy to establish a driving school. You still need to complete forms, and meet requirements, but the state seems to be driving-school friendly.

Tennessee does not require driver’s education for new teen drivers. Your “driver training enterprise”–driving school–may offer behind the wheel and classroom instruction.

How to open your driving school in Tennessee

• Tennessee has an easy process to create a driving school, although you will have to obtain forms from the Department of Safety.
• Your driving school and instructor licenses last for one year, and they expire on December 31.
• Your location is up to you, but you must have a telephone listing for the school.
• You may offer classroom instruction, and it appears you can temporarily rent classroom space.
• You must keep certain records, but do not need to use written contracts—but if you do, Tennessee requires certain terms to be included.
• Tennessee does not prescribe a curriculum, but schools offer 30-hour classroom and 6-hour behind-the-wheel courses.

Driving School Licensing and Requirements

General requirements

To operate a driving school in Tennessee, you will need to be licensed by the state. Licenses are valid for one year and they expire on December 31. You must apply for renewal at least 10 but no more than 60 days before expiration–November 2.

The forms are available at Driver Services offices. In addition to a completed application form, your application packet should include the following:

• You have an established place of business, at least one licensed driving instructor (probably yourself, at first), and a motor vehicle which has been inspected for driver training purposes.
• A certificate of liability insurance for your vehicles.
• The names, addresses, and personal histories of all owners, officers, and managers.
• A schedule of the vehicles you will be using.
• A description of your place of business and statement of hours.

The current regulations for Driver Training Enterprises are straightforward and clear. Driving school instructors and owners should know and comply with them. We will link to forms when they are posted online.

Tennessee requires the following minimum liability insurance coverage:

• $100,000 bodily injury to one person
• $300,000  bodily injury to more than one person
• $5,000 personal injury protection–medical expenses, primarily
• $10,000 property damage

If you have employees, you must carry workers’ compensation insurance covering them–and potentially you–in the event of injury while on the job. You should, of course, consider higher coverages and/or an umbrella policy to cover your operations.

Driving School Owner’s License

Tennessee places few personal requirements on owners of driving schools. The main bar would be conviction for a number of crimes involving fraudulent behavior or moral turpitude.

Owners must be at least 21 years old.

Driving Instructor’s License

While no specific requirements are set for driving school owners, instructors must demonstrate qualification before they receive a license from Tennessee. Submit the application form and fee. Instructors must meet the following qualifications.

• Be at least 21 years old. and have at least a high school diploma (or the equivalent).
• Have a current Tennessee license with a for-hire endorsement
• Don’t have more than 2 moving serious traffic violations in the past 2 years.
• Not have a suspended or revoked license.
• Pass the criminal background check.

Your application package will include the application form, a personal history, and a physical examination report completed by a doctor. You must also already  be hired by a driver training enterprise, and pass the written and driving examinations set by the Department of Safety.

Driver training instructor licenses expire on December 31 of each year, and may be renewed.

Location

You are generally free to establish your business anywhere you see fit–meeting the requirements outlined below. Your premises must be open to inspection, and have a telephone listing.

Your office space must meet local and state building requirements, and it must be accessible to the public during your regular business hours. It must be accessible to persons with disabilities.

Classrooms must be approved by the Department of Safety, and you may rent temporary classroom space for a period of instruction.

Your school license must be conspicuously displayed.

Records must be maintained at your main business office.

Classroom facilities must be in a building suitable for instruction. Compliance with local and state sanitation requirements is expected. The classroom must be equipped with suitable desks, tables, chairs and other items appropriate to the setting.

Your school name cannot be substantially similar to that of another driving school, and you may not use the words “State”, “Government”, “Municipal”, “City”, or “County” in the school name, and you must use your school’s name only in advertising and publicity.

Don’t ever give a student or parent the impression that your instruction guarantees receiving a driver’s license–you may mention your pass rate.

Vehicles

Your vehicles need to have dual controls for the brakes. They must have passed the most recent Tennessee safety and emissions inspections–and those inspections may be the most rigorous in the country. An airbag for the driver is expected.

Signage needs to be on the vehicle, identifying the name of the school and telephone number, as well as the fact that the vehicle contains a “STUDENT DRIVER”. The school name must be in letters at least 2” high and visible on the front doors and rear of the vehicle. “STUDENT DRIVER” must be at least 3” high and visible from the front, rear, and both sides.

Records and Contracts

You will need to keep records of all students and instruction for at least one year after they finish their training with you. The records must reflect the instruction given to each student as follows:

• The school name.
• The name and address of the student, as well as the students license or permit number.
• The dates and types of instruction.
• The instructor’s signature.

Students must be given itemized receipts for all charges.

You must inform the Department of Safety of each person allowed to enter into contracts for your school. You do not need to use written contracts (although we recommend them), but if you do, the Department must receive a copy of your contract form.

Students must receive a copy of the contract; you are to retain the original. Contracts must contain the following:

• The name and address of the enterprise
• A statement that “[t]his constitutes the entire agreement between the enterprise and the student and no verbal statements or promises will be recognized”.
• A statement of the fee for each lesson and/or series of lessons.
• An indication that the state regulations are available for the student–you might want to include a copy in their materials.
• A statement in which you indicate you can’t guarantee eligibility for a license.

The Driving School Curriculum in Tennessee

Driver education is not required for new teen drivers in Tennessee. That said, many schools offer a 30-hour classroom and 6-hour behind the wheel course.

The state written driving test is based on the Comprehensive Driver License Manual. You should base your curriculum on that Manual, as well as examples you can find from around the country.

Commercial Driver’s License Instruction

You’ll need to work with the Tennessee Higher Education Commission to be licensed as a CDL school.

You will need to contact the Commission to obtain the forms needed to get going.

Starting a Small Business in Tennessee

Your driving school is not just subject to the requirements for driver’s education in Tennessee. You also need to establish your Driving School as a small business, and have to consider a number of factors. The form of business you take up, as well as the procedures, are appropriate topics of conversation with your lawyer and accountant. The considerations we offer here are not legal advice, but should provide you with things to think about as you set up your business.

Business Registration

All businesses need to register in Tennessee, especially the business name—the “doing business as” certificate. Banks may not be willing to set up your account until you have that DBA form. We’ll include where to register in the business structures below.

You will also need to obtain a Federal Employer Identification Number. Banks may need it for your business accounts, and you may be wanting to employ people. To obtain an EIN, go to the IRS website and complete the application form you find linked there.

Business name

Before you get going, you’ll want to check to see if the business name you want is in fact available in Tennessee. You can search the Tennessee database, as well as visit the office of the county recorder.

Once you know your business name is available, you can reserve it with the Secretary of State’s office.

Sole Proprietorship

Owning your own business is the easiest one to set up, but also may open you to liability concerns. As a sole proprietor, your business is simply part of your life. You keep a separate set of books, and complete a Schedule C for your 1040 form every April.

Sole proprietorships can expose the proprietor for full liability, even with insurance. That may mean that if you are sued, you may lose your home and property, as well as your personal bank accounts and other assets. This risk may not be worth the ease and independence.

In Tennessee, the big step you have to take is to register your Assumed Business Name with the county or town clerk in which you have a place of business. You’ll also need to get a business license in the city or county.

Corporations and LLCs

You may set up a full corporation (“Inc.”) as your business structure. Corporations limit your liability for loss to your investment in it, as a general rule (although banks may require you to be obligated personally if you take out a loan to get your business going). This form of business keeps your personal assets safe.

As an owner of a corporation, you’ll have to set up your driving school consistently with the rules for corporations in Tennessee. You’ll also have to decide whether to be an S Corporation or a C Corporation. Generally, the S Corporation form is set up for small businesses. It allows income and taxes to pass through to the owners. You will want to discuss these forms with your attorney and accountant.

You may be able to set your driving school up as an LLC in Tennessee. The LLC form provides the same limited liability as a Corporation, but do not have to comply with the corporate formalities most states require, including items like bylaws, required stockholder meetings, and minutes (although minutes of meetings are probably a good idea).

You’ll have to discuss the advantages and disadvantages for the LLC with your attorney and accountant.

Both Corporations and LLCs file with the Secretary of State. In addition to name reservation, you’ll need to submit the forms through the same gateway at the Secretary of State’s website.

Now What Do I Do?

Once you’ve complied with all the legal requirements to be both a driving school and a small business in Tennessee, you need to get students.

Getting students requires marketing—largely on the internet. You will need the following systems set up to obtain students:

• A website—focused on the types of students you want to attract, and aimed at your locality.
• The website should also include a blog, which allows you write about a variety topics and engage in Search Engine Optimization—which will drive traffic to your site.
• A Facebook page, linked to your website, to become noticed and drive traffic.
• Getting testimonials from successful students.

Marketing is something you will have to devote time to. DrivingSchool.Marketing can help you get the best bang for your marketing buck.

Conclusion

Tennessee makes it easy to get your driving school going. Create a great curriculum–and website–and you’ll be busy very quickly.

Disclaimer: This page is part of DrivingSchool.Marketing’s series of state and provincial pages designed to help entrepreneurs like you start driving schools. States change their regulations, or the web pages they host their forms. While we believe these rules are accurate as of the date of publication, we cannot guarantee full accuracy. Please let us know if you spot any problems.

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Josh Meah

Josh is the CEO of DrivingSchool.Marketing. His goal is to be the marketing and business development partner of driving schools around the world, helping them become thriving businesses while also expanding general awareness for the importance of traffic safety standards and education.

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