Bill of Sale

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A bill of sale is a type of receipt used to transfer the ownership of an item in exchange for money or trade between a buyer and a seller. You will need the bill of sale to purchase or sell valuable items of more than $500 (e.g. vehicles, animals and pets, personal property like furniture or equipment, firearms, etc.). Ensure complete security and legality of your purchase and sale deal across the U.S. with this customizable bill of sale.

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Document Types

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Car

Bill of Sale

A car bill of sale is a legal document confirming a car purchase and sale deal.

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Horse

Bill of Sale

A horse bill of sale proves the horse purchase and sale between a buyer and a seller.

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Livestock

Bill of Sale

This essential agreement proves the legality of the livestock purchase and sale.

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Motorcycle

Bill of Sale

This form entitles an individual to purchase and hold a receipt for a motorcycle.

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Trailer

Bill of Sale

A trailer bill of sale records the sale and purchase of a pull-behind vehicle.

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Template Description

What Is a Bill of Sale?

What Are the Different Types of Bills of Sale?

How To Write a Bill of Sale

How To Use a Bill of Sale

State Law

Template Description

Whenever you sell or even gift something of value, it is always a good practice to have paperwork to cover the transaction. This documentation should include a bill of sale confirming the property transfer from the seller to the buyer.

A bill of sale template comes in handy to ensure that you will have a valid legal document with all required pieces of information included and that no important data are missed. Below we provide a detailed guide to the bill of sale and explain how to draft one to secure your transactions.

What Is a Bill of Sale?

A bill of sale serves as a receipt confirming the property transfer from the seller to the buyer as a result of selling, trading in, or gifting. It identifies the parties to the transaction and the transferred property and outlines the terms of the transfer, including the sales price, warranties (if present), and other details.

A bill of sale is valid as long as it contains all necessary information and is signed by the seller and the buyer if required by state law. Although there is no prescribed format for this document, using a bill of sale template helps to ensure that all applicable legal requirements are addressed.

Insight

You may also know the bill of sale as proof of sale, proof of purchase, proof of payment, or sales receipt. It protects the buyer and seller in the transaction and ensures that both parties have a record of the exchange, helping outline liabilities and warranties.

Parties of the Bill of Sale

Seller –– The person or organization who is selling the item or property (vehicles, animals, furniture, or equipment) to the buyer.
Buyer –– The person who is purchasing the item or property from the seller in exchange for an agreed amount of money or trade.

Key Terms

Party information: Details about both the buyer and the seller, including legal names, mailing addresses, contact information, and other identifiable information. The bill of sale must clearly state which person is the buyer and which is the seller.
Item description: This includes detailed information about the item that is being sold. The precise information needed depends on the property being sold. For example, a vehicle sale must include the car’s make, model, year, and current condition. The location of the property is also important, especially if purchasing from another state.
VIN: The vehicle identification number (VIN) must be included in a bill of sale for a car or other vehicle. The VIN is a seventeen-digit code of letters and numbers that contains information about the vehicle’s identity.
Payment: The payment terms must be included in detail. The document should state the agreed purchase price and if sales tax is included. The agreed payment methods and payment deadlines also need to be included if applicable.
Trade-in: Rather than exchanging property for money, some transactions involve trading one item for another. In these situations, detailed information about the second item needs to be included, along with a statement verifying that both items are of equal value.
Gift: An item can also transfer ownership from the seller to the buyer without exchanging money or trading items if the item is being issued as a gift. A bill of sale is still crucial to act as a legal record of property transfer. However, the document must stipulate that the property is being transferred as a gift, which is essential for tax reasons.
Warranty: The warranty clause describes the terms for replacing the item within a particular timeframe if the buyer detects damages or receives a faulty item. The warranty can be omitted if the items are being sold “as is”—a term used to transfer the item in its current condition if the buyer agrees to accept it.
Signatures: Printed names and signatures of both parties are required to make the bill of sale legally binding. Some bills of sale also require notarization from a third party. The parties must sign the document to finalize the legal transfer of ownership.

What Are the Different Types of Bills of Sale?

When you sell various types of property, you may need different bill of sale templates reflecting the nature and the specifics of the transaction. The bill of sale can come with the warranty or be an "as-is" sales receipt if no warranty is implied. Finally, the bill of sale template can be notarized if required by state law.

Depending on the property sold, there can be the following types of bill of sale:

Bill of sale for animals, for example, horses, livestock or dogs, cats, and others. Compared to generic proof of purchase, a bill of sale for an animal shall include information about the animal's gender, date of birth, breed, and other details specific to the animal.
Bill of sale for guns. Firearms are a specific category, so a sales receipt for guns should include such details as a serial number, caliber, and its make and model.
Bill of sale for equipment, for example, musical instruments, sports gear, electronics, and other appliances.
Bill of sale for furniture, antiques, dining room sets, and similar property.
Bill of sale for motor vehicles, including passenger cars, trucks, trailers, motorcycles, and tractors. Typically, the bill of sale is most often associated with the sales of motor vehicles because it is required for title transfer at the DMV in many states.
Bill of sale for a boat or other watercraft, including boat trailers.
Bill of sale for an aircraft or helicopter. Selling and operating an aircraft are heavily regulated, and having an aircraft bill of sale is mandatory for registering your airplane.

Insight

When the notary witnesses a proof of sale, that proof of sale will be easier for the new owner to register with state authorities and protect both parties’ rights and interests. Any standard bill of sale should comply with recent state laws across the country.

How To Write a Bill of Sale

The seller is always responsible for drafting the bill of sale, whereas the purchaser needs to read over the document and sign after agreeing to the terms of the contract. The following is a step-by-step guide for how to create a bill of sale for both parties.

For the Seller

Start by downloading a printable bill of sale template.
A sample for the proof of sale is a good start which can save time on drafting it from scratch and ensure that you have a valid legal document with all necessary details. You can download a bill of sale template from Lawrina in PDF and make necessary changes, if needed, to account for the specific type of property you are selling.
Request buyer's information and negotiate the terms of sale.
You will need to know the buyer’s name, their mailing address, and contact information, which you should request before drafting the proof of purchase. At this stage, you shall negotiate and agree upon the terms of sale, such as the sales price, warranty (if any), payment terms if the buyer does not pay the total price at once, payment deadlines, payment method, and other terms relevant to your transaction.
Draft the bill of sale.
When you have the bill of sale template, all necessary information from the buyer, and complete details of the property you are selling, you can quickly fill in the template with the required data. You will need to double-check the spelling of the buyer's name to match their government-issued ID and other important details applicable to your bill of sale, such as VIN/serial number and further essential information.
Put a date and sign the bill of sale.
The seller must sign the bill of sale in all cases. In some states, the buyer is also required to sign the document to have an enforceable bill of sale. If you are unsure about the requirements in your state, you should have the buyer's signature added to the bill of sale to be on the safe side.
Have the bill of sale witnessed by a notary.
Several states, including Louisiana, Maryland, Montana, Nebraska, West Virginia, and Wyoming, require a notarization of the bill of sale for vehicles for it to be legally binding. You may also choose to have the sales receipt notarized for additional legal protection, even if it is not specifically required.
Print the necessary number of copies of the bill of sale.
You will need at least one copy of the bill of sale, which you must provide to the buyer. In case of purchasing a vehicle, the buyer may need to submit the original bill of sale to the DMV, so you need three copies: for yourself, the buyer, and the third parties. Alternatively, you may have only one copy of the original bill of sale and make the necessary number of photocopies for your records.

For the Buyer

Discuss the terms of the transaction.
You need to negotiate the terms of the transaction with the seller before the latter drafts the bill of sale. You need to agree on the sales price, date of the transaction, the payment method, payment deadline or schedule, warranties (if any), and other details.
Provide your name and contact information.
The bill of sale should include information about the seller's and buyer's names, mailing addresses, and their contact information. You must provide your information to the seller to have it on the bill of sale.
Check the document before it is signed.
You will need to check the bill of sale, including the spelling of your name and the seller's name, the details of the property transferred, and other information before the seller signs the document.
Sign and date the bill of sale, if required.
You may need to sign the sales receipt on your behalf if your state law requires it or if the seller makes it a condition of the sale. You will also need a notary to witness the signature(s) in some states.
Keep a copy of the bill of sale.
The seller should always provide you with the original copy of the bill of sale as proof of your purchase. If you buy a vehicle, you may be required to submit this copy to the DMV when transferring the title. Therefore, it is always good to have another original copy of the bill of sale or at least a photocopy for your records.

How To Use a Bill of Sale

Common Use Cases

A bill of sale is a legal document used for purchase and sale deals and title transfers. It proves that the purchase and sale operation occurred on a specific date in a particular location and helps to prevent disputes between the parties.

If you want to transfer ownership of the item to another person, you will need a well-prepared bill of sale to register the new title. The signed bill of sale may be required to apply for a title at your local department of motor vehicles (DMV) or probate office. This ownership transfer procedure is required in several US states but is recommended in all jurisdictions.

After you sign a proof of purchase, you may need to pay a sales tax if it applies to your purchase and sale deal. For example, when the subject of the bill of sale is a car, the buyer must pay sales tax based on the state or county where the deal occurs or where the new owner registers the car. A seller can include the tax in the car price or split the fees.

Warning

If you skip creating and signing a simple bill of sale, you can face serious consequences. If you and the other party have reached a disagreement over the item, you will not be able to defend your rights and interests without a legally valid sales receipt. In court, you will not be able to prove your sale transaction.

When Not To Use the Bill of Sale

Although the bill of sale is useful for transferring ownership of property between two people, there are times when buyers and sellers can proceed with a transaction without a bill of sale. Below are some general examples of when a bill of sale is not required:

When the item costs less than $50;
When purchasing real estate—rather than a bill of sale, these transactions need a real estate sale and purchase agreement;
When selling services for a fee rather than property—these transactions need a service agreement instead of a bill of sale.

State Law

Not all states require a bill of sale to certify ownership. According to state law, a bill of sale is only needed in specific jurisdictions. Below are the states where you should submit your bill of sale to obtain your ownership certification.

Warning

A bill of sale is a document that records that a sales transaction occurred between two parties. It does not prove ownership but a title transfer. To transfer the vehicle title and complete the paperwork, the DMV in your state may require you to bring a completed bill of sale.

Below are the states where you should submit your bill of sale to obtain your ownership certification.

State Law

Alabama

Bill of Sale is required for owner certification.

State Law

Alaska

Bill of Sale is NOT required for owner certification.

State Law

Arizona

Bill of Sale is NOT required for owner certification.

State Law

Arkansas

Bill of Sale is required for owner certification in specific cases.

State Law

California

Bill of Sale is NOT required for owner certification.

State Law

Colorado

Bill of Sale is required for owner certification.

State Law

Connecticut

Bill of Sale is required for owner certification.

State Law

Delaware

Bill of Sale is NOT required for owner certification.

State Law

Florida

Bill of Sale is NOT required for owner certification.

State Law

Georgia

Bill of Sale is NOT required for owner certification.

State Law

Hawaii

Bill of Sale is required for owner certification.

State Law

Idaho

Bill of Sale is required for owner certification.

State Law

Illinois

Bill of Sale is NOT required for owner certification.

State Law

Indiana

Bill of Sale is NOT required for owner certification.

State Law

Iowa

Bill of Sale is NOT required for owner certification.

State Law

Kansas

Bill of Sale is NOT required for owner certification.

State Law

Kentucky

Bill of Sale is NOT required for owner certification.

State Law

Louisiana

Bill of Sale is NOT required for owner certification.

State Law

Maine

Bill of Sale is required for owner certification in specific cases.

State Law

Maryland

Bill of Sale is NOT required for owner certification.

State Law

Massachusetts

Bill of Sale is NOT required for owner certification.

State Law

Michigan

Bill of Sale is NOT required for owner certification.

State Law

Minnesota

Bill of Sale is NOT required for owner certification.

State Law

Mississippi

Bill of Sale is NOT required for owner certification.

State Law

Missouri

Bill of Sale is NOT required for owner certification.

State Law

Montana

Bill of Sale is NOT required for owner certification.

State Law

Nebraska

Bill of Sale is required for owner certification in specific cases.

State Law

Nevada

Bill of Sale is NOT required for owner certification.

State Law

New Hampshire

Bill of Sale is NOT required for owner certification.

State Law

New Jersey

Bill of Sale is NOT required for owner certification.

State Law

New Mexico

Bill of Sale is NOT required for owner certification.

State Law

New York

Bill of Sale is required for owner certification.

State Law

North Carolina

Bill of Sale is NOT required for owner certification.

State Law

North Dakota

Bill of Sale is NOT required for owner certification.

State Law

Ohio

Bill of Sale is required for owner certification.

State Law

Oklahoma

Bill of Sale is NOT required for owner certification.

State Law

Oregon

Bill of Sale is required for owner certification.

State Law

Pennsylvania

Bill of Sale is NOT required for owner certification.

State Law

Rhode Island

Bill of Sale is required for owner certification.

State Law

South Carolina

Bill of Sale is NOT required for owner certification.

State Law

South Dakota

The state-specific Bill of Sale is required for owner certification.

State Law

Tennessee

Bill of Sale is NOT required for owner certification.

State Law

Texas

Bill of Sale is NOT required for owner certification.

State Law

Utah

Bill of Sale is NOT required for owner certification.

State Law

Vermont

Bill of Sale is required for owner certification in specific cases.

State Law

Virginia

Bill of Sale is NOT required for owner certification.

State Law

Washington

Bill of Sale is required for owner certification.

State Law

West Virginia

Bill of Sale is required for owner certification.

State Law

Wisconsin

Bill of Sale is NOT required for owner certification.

State Law

Wyoming

Bill of Sale is required for owner certification.

Nevertheless, it is still recommended to have a bill of sale even if not required by state law. These legal documents can help buyers track sale information and help relieve sellers of liability over the property. They also serve as proof of ownership in case either party tries to deny the transaction, and they define the purchase condition in case of any claims on the warranty.

Insight

Notarization is the process of getting an impartial witness to sign the bill of sale, confirming the identification of both parties. Most states do not require a notary to witness the signing of a bill of sale. Moreover, by law, a notary public must witness both parties signing the document in Louisiana, Nebraska, Maryland, New Hampshire, West Virginia, and Montana. Notaries are optional in other states.

As with the requirement for a bill of sale, it is still advisable to have the agreement notarized, even if it isn’t required by state law. Notarization acts as an extra layer of verification and makes the document more permissible in a court of law in case of any disputes.

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Frequently Asked Questions

Is a bill of sale legally binding?

A bill of sale is a legally binding document, and it is essential to comply with your state’s requirements which can vary by state.

For instance, in many states, only the buyer must sign the Bill of Sale, while other states need both parties to sign the document, and some even require that the Bill of Sale be notarized. However, it is essential to note that without the buyer’s signature, the Bill of Sale may not be enforceable.

Does a bill of sale need to be notarized?

A bill of sale is a document drafted by the seller that can be used to sell any property category. Most states do not need a notary to witness the bill of sale is signed.

Furthermore, according to law, a notary public must witness both parties signing the agreement in Louisiana, Nebraska, Maryland, New Hampshire, West Virginia, and Montana. Notaries are optional in other states. It is essential to check your state requirements when entering into a bill of sale.

Who signs a bill of sale?

Some states require only the buyer to sign the document, while others require both the buyer and the seller to sign the bill of sale. Possession of the signed bill of sale and payment of the title transfer fee may be required to apply for a title at the state's DMV.

Other states call for the form to be notarized. You would need to look at the State requirements. However, it should be noted that without the buyer's signature, the Bill of Sale may not be an enforceable contract.

Do I need a bill of sale to give the property as a gift?

Having a bill of sale when gifting property is a good practice, even if your state law does not require one. Most importantly, the bill of sale establishes the date when you made the gift to the recipient, which protects you in case the latter gets into an accident involving your property.

Do I need a bill of sale when selling my car?

While not all states require the bill of sale, some jurisdictions specifically demand a signed or even notarized bill of sale to proceed with the title transfer in the DMV. Even if your state doesn't require a bill of sales for a vehicle, it is still a good practice to have one establish the date of handing over the car to the buyer to shield yourself from any accident liabilities.

What is the difference between a sales agreement and a bill of sale?

The main difference between a contract of sale and a bill of sale lies in their purpose. The goal of the sales agreement is to establish the terms of the transaction before it takes place. The purpose of the bill of sale is to confirm that the transaction took place and that the seller delivered the property to the buyer.