What a bill of sale does and when you need one in Colorado

A bill of sale is a written record that you sold a car to someone else, or that someone sold it to you. In Colorado, a bill of sale is not required by law to transfer ownership of a vehicle — the title document itself is what the state uses to track who owns what. But a bill of sale protects both the buyer and seller by creating a paper trail of the transaction: who paid what, when, and under what condition the car was in.

You should use a bill of sale whenever you buy or sell a car privately (not through a dealer). It documents the sale price, which matters for tax purposes and for proving you paid fair market value. It also protects the seller: if the buyer gets into an accident the day after purchase and the seller is still listed on the title, a bill of sale proves the seller no longer owned the vehicle. For the buyer, it proves they paid for the car and have a right to register it.

Colorado does not have a single state-mandated bill of sale form, which means you can write one yourself, use a template, or buy a pre-printed form from an office supply store. The Colorado Department of Revenue does not distribute an official form, but the document you create must include certain information to be useful.

Key Takeaways

  • Colorado law does not require a bill of sale, but creating one protects both buyer and seller by documenting the sale price, date, and vehicle condition.
  • A bill of sale must include the vehicle identification number (VIN), sale price, date of sale, names and signatures of both buyer and seller, and the odometer reading.
  • You can write a bill of sale yourself, use a free template, or purchase a pre-printed form — Colorado has no official state form.
  • Both the buyer and seller should keep a signed copy of the bill of sale, and the buyer will need it when registering the vehicle with the Colorado Division of Motor Vehicles.
  • A bill of sale does not transfer the title itself; the buyer must still submit the signed title document to the DMV to become the legal owner.

What information must go on a Colorado bill of sale

The bill of sale should include the vehicle identification number (VIN), which appears on the title and on the dashboard of the car. Include the year, make, model, and color so there is no confusion about which vehicle the sale covers. Write down the odometer reading at the time of sale — this is a legal requirement in Colorado and helps prevent odometer fraud.

Record the sale price in words and numbers. Write the date of the sale. Include the full name, address, and signature of the seller, and the full name, address, and signature of the buyer. If either party is a business or organization rather than an individual, use the legal business name and have an authorized representative sign.

You can also note the condition of the vehicle (for example, "sold as-is" or "with warranty from seller"), any defects the buyer is aware of, and whether any liens or loans are still attached to the vehicle. If there is an outstanding loan, the seller should disclose it, because the buyer will need to know the lender must be paid off before the title can be transferred.

How to write or obtain a bill of sale form

The simplest approach is to write one yourself. Open a document on your computer or use pen and paper. At the top, write "Bill of Sale" or "Vehicle Bill of Sale." Then add each piece of information listed above in a clear order. Both parties sign and date the document. Make at least two copies — one for the seller and one for the buyer.

If you prefer a template, search online for "Colorado bill of sale template" or "vehicle bill of sale template." Many free templates are available from legal document websites and are designed to meet Colorado requirements. read the template, fill in the blanks, print it, and have both parties sign.

You can also buy a pre-printed bill of sale form at an office supply store, a car parts retailer, or online. These forms typically cost between two and five dollars and are already formatted with blanks for all required information. The advantage is that a printed form looks official and is harder to dispute later.

How the bill of sale connects to the title transfer process

The bill of sale documents the sale, but it does not transfer ownership. To transfer ownership in Colorado, the buyer must take the signed title document to the Colorado Division of Motor Vehicles (DMV) along with the bill of sale, proof of insurance, and the registration fee. The DMV will issue a new title in the buyer's name.

The seller should sign the back of the title document where it says "Seller's Signature" or similar language. The buyer then submits that signed title to the DMV. The bill of sale serves as supporting documentation that proves the transaction was legitimate and shows what price was paid.

If the seller is still listed on the title after the sale, the seller remains legally responsible for the vehicle until the buyer completes the title transfer. This is why a bill of sale is important for the seller — it proves the seller no longer owned the car on a specific date, even if paperwork delays mean the title has not yet been updated.

When to sign the bill of sale and what happens next

Both the buyer and seller should sign the bill of sale at the time of sale, ideally in person. This is when the buyer hands over payment and the seller hands over the keys and title. Signing at the same time prevents disputes about whether the sale actually happened or what the terms were.

After signing, the buyer should keep the bill of sale in a safe place along with the signed title. The buyer will need both documents when registering the vehicle with the Colorado DMV. The seller should also keep a copy for their records, in case questions arise later about when the sale occurred or what condition the vehicle was in.

The buyer has a limited time to register the vehicle in Colorado — typically 30 days from the date of purchase. If the buyer does not register within that window, the vehicle cannot be legally driven on public roads. The bill of sale, along with the title, is what the DMV needs to process the registration.

Special situations: loans, liens, and out-of-state buyers

If the car has an outstanding loan, the lender's name and address should appear on the title as a lienholder. The seller cannot transfer a clear title until the loan is paid off. The bill of sale should note whether a lien exists. In some cases, the buyer and seller agree that the buyer will pay off the loan directly, or the seller will use the sale proceeds to pay it off before the title is transferred. This arrangement should be documented in the bill of sale or in a separate agreement.

If the buyer lives out of state, the bill of sale is still valid and useful. The buyer will need to register the vehicle in their home state, and most states accept a Colorado bill of sale as proof of purchase. The buyer should keep the bill of sale and the Colorado title together.

If you are selling a vehicle to a dealer or a business that buys used cars, the dealer will usually provide their own bill of sale form or handle the paperwork themselves. You should still ask for a copy of whatever document they use, so you have proof the sale occurred.

Frequently Asked Questions

Do I have to notarize a bill of sale in Colorado?

No, notarization is not required by Colorado law. A bill of sale is valid as long as both parties sign it and it includes the required information. However, some people choose to have it notarized for extra protection, especially in high-value sales. A notary public can verify the identities of the buyer and seller and add an official seal.

What if I lost the bill of sale after I bought the car?

If you have the title in your name, you own the car and can drive and register it. The bill of sale is a record of the transaction, but it is not required to prove ownership — the title is. If you need proof of what you paid for the car (for insurance or tax purposes), you can contact the seller and ask for a copy, or you may be able to reconstruct the information from bank records or payment receipts.

Can I sell a car without a bill of sale in Colorado?

Yes, Colorado does not legally require a bill of sale. However, it is strongly recommended. Without one, there is no written record of the sale, the price, or the date. This creates risk for both buyer and seller — the seller has no proof they no longer own the vehicle, and the buyer has no proof of purchase if a dispute arises later.

What if the buyer does not register the car after I sell it?

If the buyer does not transfer the title to their name, you remain the registered owner. This means you could be held liable for parking tickets, traffic violations, or accidents involving the vehicle. A bill of sale proves you sold it on a specific date, but it does not remove your name from the title. You should follow up with the buyer to make sure they complete the registration, or contact the Colorado DMV to report the sale if the buyer does not act within a reasonable time.

Is a bill of sale the same as a title?

No. A title is the legal document issued by the state that proves ownership. A bill of sale is a record of the transaction between buyer and seller. The title is what you submit to the DMV to transfer ownership. The bill of sale supports that transfer by documenting that the sale happened and what the terms were.