A bill of sale documents the purchase of a piece of property and its transfer from a seller to a buyer. It’s often used in vehicle sale transactions and may be required by your state.
Learn more about what’s included in a bill of sale, whether you need one to sell your car, and how to write one.
- A bill of sale for a car documents the purchase of a vehicle and typically includes the date, purchase price, vehicle details, and involved parties.
- Some states require a bill of sale for vehicle sales while others don’t.
- A bill of sale can help to prove the price paid for the vehicle to the state for sales tax purposes. It can also protect the seller against liability after the transfer of property.
- Regardless of state requirements, a bill of sale is a good protective step for buyers and sellers.
What Is a Bill of Sale?
A bill of sale is a document that provides proof of a sale and the transfer of property from one party to another. It can be used when selling a variety of items but is most commonly used for vehicle sale transactions.
The bill of sale will identify the parties involved in the transaction, the property being transferred, and the date and price of the transaction. As a result, both parties will have proof of the sale. It can be important to show a release of liability on the part of the seller.
For example, say a car was sold from one private party to another. However, the buyer did not properly register the vehicle and used the car to commit a crime. With a bill of sale, the seller could prove they were no longer in possession of the vehicle.
Who Needs a Bill of Sale for a Car?
It’s wise to create a bill of sale for all private vehicle sale transactions so there is a record showing both parties agreed on the terms. However, in some states, it’s required. Several states also require you to use a specific form and/or have the bill of sale notarized.
Here’s a detailed look at the bill of sale requirements by state.
|State||Requires Bill of Sale for Private Party Vehicle Purchase with Title||Requires a Notarized Bill of Sale||Requires Specific Bill of Sale Form||State Provides Form|
|Illinois||No (But may be required on a case by case basis)||No||No||Not found|
|Kansas||No (unless the title doesn't have space for the purchase price)||No||Yes||Yes|
|Louisiana||No (unless a title has not been issued in the state for the vehicle before)||Yes||No||Yes|
|Maryland||Yes||Yes (under some conditions)||Yes||Yes|
|Mississippi||No (unless the title doesn't have space for the purchase price)||No||No||Not found|
|Missouri||Yes (Or a Notice of Sale)||No||Yes||Yes|
|Nebraska||Yes (or the DoR Form 6)||Not specified||No||Yes|
|New Hampshire||No (except for title exempt vehicles)||No||No||Not found|
|New Jersey||Yes||No||No||Not found|
|New Mexico||No (Unless Assignment of Title is not on the back of the Title)||No||Yes||Yes|
|North Carolina||No||No||No||Not found|
|Oregon||No (But you can sign either the title or a bill of sale)||No||No||Yes|
|Rhode Island||Yes||No||No||Not found|
|South Carolina||No (Unless the purchase price and odometer reading are not on the title)||No||No||Not found|
|West Virginia||Yes (If the sale price is less than 50% of the NADA Clean Book loan value)||Yes||Yes||Yes|
How To Write a Bill of Sale for a Car
While many states provide bill of sale forms, your state may also allow you to write one yourself. However, it will need specific information that often includes:
- Date the vehicle was sold
- Selling price of the vehicle
- Vehicle’s make, year, model, odometer reading, and vehicle identification number (VIN)
- Name, address, and signature of the buyer
- Name, address, and signature of the seller
Be sure to check your state’s laws to find out if a bill of sale is required, if it can be written, and what must be included.
Frequently Asked Questions (FAQs)
How do you fill out a title when selling a car?
Filling out the title when selling your car will vary slightly from state to state. It typically requires completing a few fields like the selling date, selling price, odometer reading, seller’s and buyer’s names. Signatures are often required to release seller interest in the vehicle, transfer ownership to the buyer, and certify that all the information provided was true and correct.
Who pays sales tax when you’re selling a car privately?
When you sell a car privately, the buyer will pay any applicable sales tax to the state’s driving authority when they register and title the vehicle. States often give buyers a set period to register the vehicle and pay the tax.