Having written documentation that verifies the change of legal ownership is always a smart idea. A written record that details the transfer of personal property is also known as a bill of sale. In Texas, a bill of sale is not legally required; however, creating or obtaining one is a valuable way to verify a sale, especially when selling expensive personal property such commercial equipment or precious metals. A bill of sale is also helpful when selling a vehicle as proof that a person is no longer liable for costs of ownership.
When to Use a Bill of Sale
A bill of sale is useful for transferring items such as equipment, inventory, furniture, machinery, or intellectual property. It is important to document the major terms of a personal property transaction.
Information to Include
Including the following information is a good practice when drafting a bill of sale:
- - the contact information for buyer and seller;
- - identifying information about the item, a car’s VIN number and its make, model, and year, for example;
- - the history of ownership if possible;
- - the purchase date and amount;
- - signatures of the buyer and seller.
Below is a sample of effective language for a bill of sale:
"It is the desire of Assignor[s] hereby to assign, transfer and convey to Assignee[s] all fixtures, fittings, appliances, apparatus, equipment, machinery, contract rights, claims, trade names, escrow or reserve accounts, if any, bonds, warranties and guaranties, and other items of personal property, both tangible and intangible (excluding cash), owned by Assignor[s], if any."
Drafting a bill of sale for valuable items, especially as part of another transaction such as a business acquisition or real estate transfer is complex. Working with an attorney means that the bill of sale will be accurate and that you will receive sound legal advice should anything go wrong with the sale.
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