What is a Bill of Sale?
A Bill of Sale is a document that legally records the ownership of an asset from one person or entity to another in exchange for a sum of money. This document is used while carrying out a wide variety of transactions. Some examples include the sale of cars, motorcycles, and air-craft. In the United States, most states require a Bill of Sale as proof of purchase when a vehicle is bought or sold. A Bill of Sale can also be referred to as the Sales Receipt, Proof of Sale, or a Sales Slip. This document is typically drafted by the seller and it contains the details of the transaction taking place.
Bill of Sale Template
The team at SBA.com® has created a sample Bill of Sale document that can be easily modified to fit your needs. We recommend that you follow a consistent format when making a sale, especially when there are multiple transactions over time.
A Bill of Sale is intended to protect both the seller and buyer of an asset and it can be used should a future disagreement arise. It is recommended that both parties preserve a copy of the fully executed document. This serves as proof of payment and purchase. This document typically carries more weight than any ordinary sale receipt as it has a signature from both the parties involved in a sale.
How can a Bill of Sale be used?
This document can be used to transfer ownership of goods already owned by an entity or physical goods produced by a business. A Bill of Sale can be used by a business for procurements where full payment has been made during the time of acquisition. Both parties involved in the deal typically accept to sell or buy the product in the condition it is “as-is”. The term “as-is” is crucial as it conveys the form in which the product was sold and offers the asset with no guarantees or warranties. It is evidence to prove that the purchaser had no issues with the product condition at the time of purchase. The term “as-is” can give the seller protection from refund requests from the buyer.
Can a Bill of Sale be used as an acknowledgment for services rendered?
A bill of sale is generally used for the purchase and sale of physical goods. For services, it is good practice to use documents like an Independent Contractor Agreement or a Service Agreement. It is recommended that you use a Bill of Sale for all physical good purchases and sales. This is because this document serves as proof of ownership. For instance, if you have machinery in your factory that you are selling to somebody, then you can use a Bill of Sale to prove the ownership and sale of the asset. Using a Bill of Sale could potentially help you defend your rights if the need arises in the future.