Illinois Vehicle Bill of Sale: What It Is & When You Need One
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Whenever you are buying or selling a car in a private sale, using a vehicle bill of sale in Illinois is advisable to ensure a smooth, lawful transaction. While Illinois doesn't explicitly require a vehicle bill of sale for auto sales, having one can protect the financial and legal interests of buyers and sellers.
Learn key details about and steps for creating an Illinois motor vehicle bill of sale, as well as how they're beneficial when titling and registering a newly purchased vehicle in your name.
What Is a Vehicle Bill of Sale and Why Is It Important in Illinois?
A vehicle bill of sale form outlines the transaction terms between buyer and seller, acting as a form of receipt. It serves as evidence of the vehicle's purchase price and general condition at the time of the sale.
Buyers don't need the bill of sale to register a vehicle in their name. However, it may help the Illinois Secretary of State Vehicle Services Department (VSD) calculate the use tax due on the transaction. That's because the bill includes the vehicle's sales price, which won't be on the title itself.
Sellers may use the bill of sale to protect themselves from legal challenges that arise from the transaction.
When Is a Vehicle Bill of Sale Required in Illinois?
A vehicle bill of sale isn't a legal requirement in Illinois, but the VSD may request it as proof of the car's purchase price. It records a vehicle's transfer of ownership, acting as a secondary form of evidence in an Illinois title transfer.
It's good practice to utilize a vehicle bill of sale as a buyer or seller. The Illinois Secretary of State recommends it in private sale transactions involving used vehicles. Not having the document may open the door to future disagreements between buyers or sellers. It can also delay the titling and Illinois car registration process.
Key Details To Include in an Illinois Vehicle Bill of Sale
Generally, an Illinois motor vehicle bill of sale contains the following elements:
- Buyer and Seller Details: Names, addresses, and phone numbers of both parties
- Vehicle Description: Vehicle Identification Number (VIN), make and model, year, and color
- Title Number: Seller's vehicle title number
- Purchase Price: Amount paid for the vehicle
- Terms and Conditions: Legal acknowledgments that apply to the vehicle's sale
The buyer and seller sign and date the bill of sale. Each party retains a copy for their records.
Steps for Drafting a Vehicle Bill of Sale in Illinois
Unfortunately, Illinois doesn't provide government-approved Illinois car purchase forms. You can draft a bill of sale yourself, but it's worth getting an attorney to look it over to make sure you haven't missed any critical points.
1. Consider Using a Template
Several websites, including Dropbox and Rocket Lawyer, offer Illinois vehicle bill of sale templates. You can use the templates to customize your document.
2. List Seller and Buyer Information
Start by noting the buyer and seller's name, address, and phone number. Include any other important identifying details, such as driver's license or identification number.
3. Share Vehicle Information and Sales Price
Document the car's sales price, VIN, make and model, and manufacture year. You can also list its mileage. Verify the information matches the details on the original title.
4. Give Terms and Conditions
Terms and conditions outline the vehicle's condition and whether the sale is "as is" or comes with a guarantee or warranty. Include these statements for clarification in case of a future legal dispute.
How the Bill of Sale Relates to Title Transfers and Registration
Buyers seeking to title and register a vehicle in their name will need a few documents to complete the process, including:
- The vehicle's original title
- Illinois application for title
- Proof of Illinois car insurance
- Relevant tax form (usually the RUT-50 for in-state private party vehicle sales)
- Registration fees
While the vehicle bill of sale isn't part of the registration requirements, it is a supporting document for tax forms. Private buyers pay sales or use tax when they register their vehicles. Without a bill of sale, Illinois determines the tax owed using the car's estimated fair market value.
Do You Need to Have the Bill of Sale Notarized in Illinois?
Illinois vehicle bill of sale requirements don't obligate you to notarize the document. However, a notarized bill of sale carries greater legal weight. It's harder for either party to dispute its terms if a notary witnessed it. Also, notaries verify each party's identity prior to signing, which may reduce the risk of a fraudulent transaction.
The Importance of Keeping Copies of the Bill of Sale
Treat a vehicle bill of sale like other vital documents. Keep it in a secure place, such as a fireproof box or safe. You may also want to scan it electronically and save an encrypted version on your laptop or personal computer (PC).
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