Author : Anna O'Shaughnessy.
Published : Sun, Sep 9 2018 :11 AM.
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A bill of sale is a document that verifies your purchase, and therefore your ownership of, a valuable asset such as a car, a TV or other large item. Not only does the bill of sale prove you legally own the item, it may be used to determine how much sales tax you pay. It also releases the seller from liability and protects both buyer and seller from any disputes that may arise over the item in the future. Rules for bills of sale vary from state to state. For example, Michigan does not require a bill of sale when buying or selling a car.
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Seller and Buyer: It is common to include contact information for both seller and buyer, such as address and phone number, along with a driver’s license number. Buyers may want to check a seller’s driver’s license or picture ID before handing over funds and signing the bill of sale to ensure they are buying from the person listed on the receipt.
Payment: In addition to the price of the item for sale, document the form of payment and whether the final total includes sales tax. If you are trading items rather than selling them for cash, describe the transaction on the bill of sale with details about each of the items being exchanged.
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Using a Bill of Sale is recommended even when selling or trading items with friends or family members because of the documents power to show proof of ownership. For example, if a parent gifts or sells their vehicle to their child, the child will need a Bill of Sale to prove their ownership of the car so they can get it registered and insured.
Item Description: This may be simple or detailed, depending on the item for sale and state requirements. For example, when selling a vehicle, you usually need to include the vehicle identification number (VIN) and odometer reading. If you are selling a horse, you’ll need information about registration and breeding.