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What is a Bill of Sale?

A bill of sale is a legal document that states that one person has taken legal possession of another person's vehicle in exchange for money. Whenever you buy, sell or trade in a car, both parties will have to sign the bill of sale in order for the purchase or trade to be complete.


What Kind Of Information Is Included In The Bill Of Sale?

The bill of sale will list the make and model of the vehicle, how much was paid for it, and the VIN number of the vehicle. It may also contain the odometer reading and other information about the vehicle itself.


Can I Get Information About A Bill Of Sale?

Yes. Under the Freedom of Information Act and similar laws, the bill of sale becomes a matter of public record as soon as the new owner registers the vehicle. The information on it should be available through a vehicle history search.


Why Does A Bill Of Sale Matter?

If you have a bill of sale, the person you bought the car from can't take your money and then have you charged with vehicle theft. Beyond that, you can't register your vehicle until you have a signed bill of sale. The bill of sale will also be used for tax purposes if there is a sales tax law in your state.


What Do I Need To Do In Order To Make A Bill Of Sale Legal?

That depends on your state. In general, however ,for a bill of sale to be legal it needs to have the following information on it:


  • The seller's name
  • The buyer's name
  • Signatures from both parties
  • The VIN number
  • The make of the vehicle
  • The model of the vehicle
  • The year of the vehicle
  • The color of the vehicle
  • In some states, the bill of sale needs to be notarized.


Can I Just List The Price Of The Car As A "Gift" To Avoid Sales Taxes On The Vehicle?

You might be able to, but this would generally be a bad idea. For one thing, many states tax you on the current value of the vehicle, not on the amount you paid for it. You will have to write the Kelley Blue Book vehicle value on the bill of sale anyway. For another, the state will investigate you for vehicle fraud if they think you are faking the sale price. It's not worth five years in jail to avoid taxes when buying or selling a vehicle.


Will The Information In The Bill Of Sale Affect How Much It Costs Me To Register The Used Vehicle I Bought?

That depends on the state. In some states, you pay a flat fee to register your vehicle no matter how much it is worth. In other states the registration costs are based on the fair market value. And in others, it is based on what you paid for it. You can learn more about how it will affect the registration costs in your state by checking with your local DMV.


Are There Templates Available For Me To Create A Legal Bill Of Sale For The Used Car I'm Trying To Sell?

Yes. You can use our service to download and print out free bill of sale templates for your vehicle. Once you have them downloaded, make sure both you and the buyer fill out all of the information correctly and that you both sign the document so it will be considered legal and accepted by the DMV when the buyer wants to register the vehicle.


What Should I Do If The Seller Won't Sign Or Accept The Bill Of Sale?

Yes. You can use our service to download and print out free bill of sale templates for your vehicle. Once you have them downloaded, make sure both you and the buyer fill out all of the information correctly and that you both sign the document so it will be considered legal and accepted by the DMV when the buyer wants to register the vehicle.


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