Bill of Sale for a Car in Colorado: What It Is and How It Works
When you buy or sell a private vehicle in Colorado, a bill of sale is one of the most important documents in the transaction. It creates a written record of what was sold, who sold it, how much it went for, and when the deal happened. Understanding what goes into one — and why it matters — can protect both parties long after the keys change hands.
What a Bill of Sale Actually Does
A bill of sale is a written agreement between a seller and a buyer that documents the transfer of a vehicle from one private party to another. It is not the same as a title. The title proves legal ownership; the bill of sale proves the terms under which ownership was transferred.
In Colorado, a bill of sale serves several practical purposes:
- It establishes the sale price, which the Colorado DMV may use to calculate sales tax owed at registration
- It gives the buyer evidence of purchase if title transfer is delayed
- It protects the seller if the buyer incurs tickets, fees, or liability after the sale
- It can help resolve disputes about the condition of the vehicle at the time of sale
Colorado does not require a bill of sale for every private vehicle transaction, but having one is strongly advisable. Without it, either party may have difficulty proving what was agreed to.
What Colorado's Bill of Sale Should Include
Colorado has a specific form — DR 2173 — that the DMV provides as an official bill of sale for motor vehicles. Using this form isn't always mandatory, but it covers all the fields the state expects to see and reduces the risk of missing something important.
Whether you use the state form or draft your own, a Colorado vehicle bill of sale should include:
| Field | Why It Matters |
|---|---|
| Full legal names of buyer and seller | Establishes who was involved |
| Current addresses of both parties | Supports identity and jurisdiction |
| Date of sale | Establishes when ownership transferred |
| Vehicle Identification Number (VIN) | Ties the document to a specific vehicle |
| Year, make, and model | Confirms what was sold |
| Odometer reading at time of sale | Required for title transfer in most cases |
| Sale price | Used by the DMV to assess sales/use tax |
| Signatures of both parties | Makes the document legally binding |
An "as-is" notation is common in private sales and signals that the buyer accepts the vehicle in its current condition. This doesn't eliminate fraud claims if the seller knowingly misrepresented the vehicle, but it does limit the seller's exposure to after-the-fact complaints about normal wear or undisclosed issues.
How the Bill of Sale Connects to Title Transfer
In Colorado, the buyer must transfer the title into their name within 60 days of purchase — though you should verify current deadlines directly with the Colorado DMV, as timelines and fees can change. The bill of sale supports that process by documenting the sale price for state sales tax or use tax purposes.
Colorado charges sales tax on private vehicle purchases based on the county and municipality where the buyer registers the vehicle. The bill of sale is often the primary document used to verify what the buyer actually paid — which is why recording the accurate sale price matters. Some counties may assess tax on the vehicle's fair market value if the stated sale price appears unusually low.
The title itself must be properly signed over by the seller, with the odometer disclosure completed. The bill of sale works alongside the title — it does not replace it. 🚗
Who Keeps a Copy
Both parties should retain a signed copy of the bill of sale. The seller especially benefits from keeping one on file.
Why the seller needs it: In Colorado, a seller should notify the DMV after a sale using the appropriate form or online process. Until the buyer registers the vehicle in their name, the previous owner may still appear connected to it. If the buyer drives the car unregistered — or worse, causes an accident or accumulates violations — having a dated bill of sale with the buyer's name and address can help the seller establish that they no longer owned the vehicle at the time.
Why the buyer needs it: The buyer may need the bill of sale to register the vehicle, to show as proof of purchase if the title is delayed, or as evidence in any dispute with the seller over the vehicle's condition or agreed price. ✅
Variables That Shape How This Works in Practice
Not every Colorado vehicle transaction is the same. Several factors affect how the bill of sale fits into the larger process:
- Vehicle type: Cars, trucks, motorcycles, trailers, and off-highway vehicles may involve different forms or processes
- Vehicle age: Older vehicles may be exempt from certain odometer disclosure requirements
- Sale price vs. market value: A very low sale price — such as a gift between family members — may be handled differently for tax purposes
- County of registration: Sales tax rates vary across Colorado counties and municipalities
- Whether a dealer is involved: Licensed dealers handle paperwork differently than private parties; the DR 2173 is primarily relevant in private-party sales
- Liens on the vehicle: If the seller still owes money on the car, the lienholder is part of the title transfer process
A straightforward private sale between two individuals with a clean title looks very different from a sale involving a lien release, an out-of-state title, or a vehicle gifted between relatives. ��
The Part Only You Can Fill In
The general framework is consistent across Colorado, but the details that determine your actual process — what forms you need, what tax you'll owe, what your county requires at the time of registration — depend on your specific vehicle, your county, the current state of the title, and the circumstances of the sale. Those details sit outside what any general guide can answer for you.
