A bill of sale is a document that proves the transfer of ownership. This document can be used to record a variety of transactions, the most typical of which include automobiles such as cars, motorcycles, and boats. However, a bill of sale can be used to sell personal objects such as clothing, furniture, or even pets.
Typically, the seller is responsible for creating the bill of sale, which should include all of the transaction’s facts. But what exactly should a bill of sale include?
In this guide, we’ll break down what a bill of sale is, provide examples, and walk you through six simple steps to create one. Whether you’re a seller or a buyer, knowing how to craft a bill of sale is a skill that can protect both parties involved.
What is a Bill of Sale?
A bill of sale is a document that transfers ownership of an item from one person to another. That sounds fancy, but it’s very similar to a receipt: it’s a piece of paper that validates the sale.
A bill of sale is widely used to sell transportation equipment including autos, motorbikes, and boats. However, you can use a bill of sale to transfer ownership of any major item, whether it’s a piece of industry equipment your company no longer requires or some old furniture you won’t keep as part of your workplace redesign.
When you sell something like that, your bill of sale will include basic information like:
- Seller name and contact information
- Buyer name and contact information
- Description of the item(s) you’re selling
- Price of the item(s) you’re selling
- Date the sale was made
- Space for the buyer and seller to sign
While the name “bill of sale” sounds formal and rigid, it’s pretty straightforward: it’s simply a short document that serves as proof that the ownership of an item has moved to someone else.
READ ALSO: How to Write a Poem About Yourself in these 7 Step-by-Step Guide
What Does a Bill of Sale Look Like?
What your bill of sale will look like is determined by the specifics of what you’re selling, which directly determines the information you need to provide.
When selling a vehicle, provide relevant information such as make, model, year, VIN number, and odometer reading. However, if you’re selling a piece of equipment, you may need the model, year, and serial number.
Here’s how a bill of sale can look:
Bill of Sale
Seller’s Name: Francis Nico
Seller’s Address: No.12 Electric City Ave., Mile 2
Seller’s Contact Information: michael@dundermifflin.com, 303-867-5309
Buyer’s Name: Chi Amaka
Buyer’s Address: No.24 Inland Road, Diobu
Buyer’s Contact Information: dwight@dundermifflin.com, 303-123-4567
On this 19th day of January 2024, the Seller grants the sale and transfers ownership of the following goods:
- 2004 Mercedes Maybach, 196,592 miles
This good is exchanged for $22,000 USD paid in full with a cash payment.
Seller’s Signature: ____________________________________________ Date: ______________________
Buyer’s Signature:____________________________________________ Date: ______________________
Pretty simple, right? In general, your simple bill of sale should be no more than one page long, unless there is a lot of detail about the specific things you’ve sold.
You may want to see Where to Get the Best Freelance Blogging Jobs With No Experience: 15 Places
Is A Bill of Sale The Same As a Receipt?
A bill of sale and a sales receipt share many characteristics. In reality, a receipt is classified as a form of bill of sale.
The fundamental distinction between the two is that a bill of sale contains more extensive information about the item being sold, but a receipt may only include a few words to identify the item.
Why Should You Use A Bill of Sale?
When you sell a significant thing, you want to get your money and go on. So, is it worthwhile to make the effort to draft this document?
Here are a few reasons why you must draft a bill of sale when selling any of your items:
- Providing evidence: When you sell something, you want documentation that ownership has been transferred, and the buyer wants proof that they are the new owner. The bill of sale gives everyone peace of mind knowing that their sale or purchase is in writing.
- Staying compliant: In certain states and situations, a bill of sale may be necessary. Some states require a bill of sale to prove ownership and complete the sale of a car. In certain circumstances, creating the bill of sale guarantees that you follow any local requirements (and helps you avoid future fines, issues, or penalties).
- Aligning expectations: Both the buyer and seller will need to review and sign the bill of sale. When doing so, they’ll look over the details of the item and confirm their understanding of exactly what’s being sold as well as the item’s condition or inclusions. This can help prevent any disputes from coming up later.
Keep reading to find out how to write a bill of sale.
SEE ALSO: How To Write An Abstract for a Lab Report | Step-by-Step Guide & Examples
How To Write A Bill of Sale
When selling a major item, a firm handshake and a nod of the head are insufficient to cement the deal; a bill of sale adds clarity and formality to the transaction.
Whether you want to start with a template or go completely DIY, here are six steps to help you learn how to write a bill of sale.
1. Identify the item(s) you’re selling
Many of the details in your bill of sale will be determined by what you’re selling. When selling a vehicle, you’ll need to offer different details than when selling many unneeded PCs.
That is why you should begin by establishing what you need the bill of sale for.
Are you wondering if you may include several items on a single bill of sale? It’s possible; to simply list the goods and their accompanying expenses on separate lines.
However, if your commodities have multiple payment methods, payment durations, or even information such as loans or liens, it’s probably best to separate them into distinct bills of sale to prevent misunderstanding.
READ ALSO: How to Write Good Character Reference for Court: Rules, Tips & Template
2. Check your state requirements
The “rules” governing your bill of sale might get hazy — and many of these criteria are determined by both your area and the individual item you’re selling.
Some internet research can help you obtain the information you require. Use the following keywords when searching for any regulations or instructions:
[your location] [item you’re selling] bill of sale
So, for example, you may enter “Wisconsin vehicle bill of sale” into your search box. That should bring up the information you need. Just make sure it comes from a reliable and legitimate source, such as your state’s website.
READ ALSO: How To Write A Song Title in an Essay: 7 Rules to Remember
3. List the buyer’s and seller’s information
The bill of sale is an agreement between you and the buyer, so you need to clearly state who you are. At a minimum, include:
- Your full names
- Your addresses
- Your contact information
You might also want to include driver’s license numbers or some other way of verifying identity, but it’s not an absolute necessity.
4. Clearly describe the item (in detail!)
What makes a bill of sale different from a receipt is the level of detail you use to describe the item that’s being sold. While receipts might use a single line and a couple of words to indicate an item, your bill of sale should provide plenty of information.
For example, if you’re selling a car, you’ll include the year, make, model, VIN, and mileage. Or if you’re selling a piece of equipment, you’ll include the make, year, and serial number.
While you don’t need this to be hundreds of words, make sure to provide enough detail. It certainly can’t hurt.
5. Outline payment details
When you’re making a sale, the thing you care most about is the money. Your bill of sale should spell all of that out. Here are the questions your document should clearly answer:
- How much does the item sell for?
- Is it paid in installments or in full?
- What is the payment method (cash, cheque, credit card, etc.)?
That is critical information to have on file, especially if the buyer must adhere to a specific payment schedule for installments.
WritersGig has a large pool of creative writers who have mastered the art of transforming your ideas into stories that excite readers. Check out the 7 Best Websites To Hire Freelancers For Shortstory Writing In Africa
6. Include space for signatures
The bill of sale must be signed and dated by both you and your buyer to be considered “official.” Include a section at the bottom of the page where you may sign and finalize the agreement.
These are the fundamental procedures for creating a bill of sale. However, depending on your specific scenario, you may need to include other information, such as warranty information or loan or lien details. Nonetheless, creating your bill of sale should be simple and quick.
Who Writes a Bill of Sale?
The bill of sale could be written by the seller. In some areas, when a car is sold, the dealership gives the bill of sale. However, in the case of a private sale, both the buyer and the seller may be required to prepare and sign a bill of sale document. A seller may hire a contract lawyer to create a bill of sale.
Some states also utilize a state-approved form for bill of sale paperwork. Others allow individuals to create their own bill of sale documents without using a template.
FAQs On How to Write Up a Bill of Sale
A bill of sale is a document that transfers ownership of an item from one person to another. That sounds fancy, but it’s very similar to a receipt: it’s a piece of paper that validates the sale.
The bill of sale could be written by the seller. In some areas, when a car is sold, the dealership gives the bill of sale.
A bill of sale and a sales receipt have a lot of similarities. In fact, a receipt is considered a type of bill of sale.
References
- wrike.com – Simple Bill of Sale: Explanation and Examples
- contractscounsel.com – How To Write a Bill of Sale: 8 Steps to Follow
We Also Recommend
- How To Write an Effective Theme Statement: Rules, Tips & Template
- How To Write a Retirement Letter With Steps and an Example: Rules, Tips & Questions
- How to Write a Devotional Book or Message in Less Words: Outline for Youth, Church
- How to Write in First Person Point of View (POV): Dos and Don’ts, Tips and Examples
