The Illinois bill of sale is a document drafted between the seller and the buyer, serving as proof of ownership transfer of a certain item. The main reasons people are using the bill of sale are:
Reasons to Use Illinois Bill of Sale
It is often required for item registration (with motor vehicles, boats, and trailers).
It can serve as proof of the purchase price for tax reasons.
The seller can use it to limit its liability for the item after the purchase.
It can be used as proof of ownership if the item doesn’t have a title certificate.
The parties can enter additional details that cannot fit in the title certificate.
Illinois Bill of Sale Parties
The buyer and the seller are the main parties to the bill of sale.
Seller
The seller, or transferor, is the party that transfers their personal property to the buyer in exchange for the purchase price.
Buyer
The buyer, or transferee, is the party that obtains the item from the seller and pays the purchase price in return.
Buyer And Seller Disclosure
The seller should disclose if the item has any damage or flaws in the bill of sale.
In addition, the seller can protect themselves by providing the “as is” condition. This way, the buyer agrees to buy the item with all its damages and flaws present at the moment of purchase. This prevents the buyer from raising any claims after the purchase. The “as is” condition will not be valid for the hidden or lied about damages.
Finally, the sellers of motor vehicles should include the odometer disclosure in every motor vehicle bill of sale. This is required on the federal level by the Truth in Mileage Act, so it should be included in every bill of sale, regardless of the state.
Illinois Bill of Sale Description of Goods
This section contains all the relevant information about the transferred item. The description of goods looks different depending on the type of item that is transferred. However, all of them should include:
Mandatory Information
Make and model
Production year and color
Description of any damages or flaws
Identification number
Description of any supplemental items that are attached to the item
Odometer reading (for motor vehicles)
In general, the rule of thumb is to include all the information about the item that can make it distinguishable from other items of its kind.
Illinois Bill of Sale Purchase
The purchase price outlines the compensation due to the seller for transferring ownership of the item. Below are the three most commonly used compensation methods.
#1. Payment
With this method, the buyer gives the seller a certain amount of money in exchange for the item. The payment can be made in cash, using checks, credit or debit cards, or via bank transfer.
#2. Trade
With the trade, the buyer gives an item to the seller in exchange for the seller’s item. It is often the case that the buyer transfers an additional amount of money to cover the difference in price between the two items.
This is often used in motor vehicle purchases, where the buyer gives their old vehicle in exchange for the new one.
#3. Gift
With the gift, there is no compensation owed to the seller. Family members often use this method to transfer ownership of their personal property.
Illinois Bill of Sale for Motor Vehicles (Cars) Requirements
The Illinois Secretary of State is a government body responsible for vehicle registration. Although it is not required, you should also submit the bill of sale when registering your vehicle.
Out-of-State Vehicles
If you purchased a vehicle from another state, you should get a title and registration in Illinois. You can submit the bill of sale to register your vehicle if you got it from a state that doesn’t issue a vehicle title.
Abandoned or Junk Vehicles
If the vehicle is damaged to the extent that the repair is more expensive than the value of the vehicle, the owner can apply for a salvage or junk title. Junk vehicles can be transferred further using the junk title or the general bill of sale.
Vehicles Sold by Dealers
A dealer should apply for the title and registration on your behalf at the local Secretary of State office. In the meantime, you can use the bill of sale as proof of ownership.
Vehicles Sold by Private Parties
Private parties can use the title to transfer the motor vehicle’s ownership. If they wish to insert any details that are not specified in the title, they can use the bill of sale.
Illinois Bill of Sale for Boats (Vessel) Requirements
If you buy a boat in Illinois, you must register it with the Department of Natural Resources.
The bill of sale should include the following:
Mandatory Information
Names, addresses, and ID numbers of the buyer and the seller
Make, model, and production year of the boat/vessel
Hull identification number (HIN)
Boat/vessel length
Odometer reading (in hours)
Details about any additional equipment that comes with the boat/vessel
Illinois Bill of Sale for Firearms Requirements
You are not required to register a firearm in Illinois.
However, you should always sign the bill of sale when transferring handgun ownership. This way, the buyer will have proof of ownership, and the seller will limit their liability after the firearm leaves their possession.
Illinois Bill of Sale for Horses Requirements
The horse bill of sale for Illinois should include the following:
Mandatory Information
Details about the buyer and the seller
Name, breed, gender, and age of the horse
Registration number
Description of the horse and its condition
Details about any additional accessories or equipment sold with the horse
Illinois Bill of Sale for Trailers (RVs) Requirements
Trailers and RVs in Illinois must be registered like any other motor vehicle. The bill of sale is not required to be submitted for registration. However, it can be attached to the certificate of title if it provides additional details about the transfer.
Illinois Bill of Sale Other Requirements
The bill of sale can be drafted in any language both parties can understand. However, if you draft the bill of sale in any language other than English, you should submit the official translation when registering the item.
Each party to the bill of sale should keep at least one copy for their records.
Illinois Bill of Sale Taxes
If you have purchased a car in Illinois, you should submit the sales tax application to the Illinois Department of Revenue. The tax is calculated based on the vehicle’s purchase price and production year.
If these details are not provided in the vehicle title, you can use the bill of sale as proof of the purchase price and production year. Otherwise, the tax authorities will determine the fair market value of your vehicle to calculate the sales tax.
Illinois Bill of Sale FAQ
Yes, the handwritten bill of sale is a legitimate and binding legal document in Illinois.
The bill of sale must be signed by the buyer and the seller. In some special cases, one or more witnesses should also sign the bill of sale to confirm the authenticity of the document.
You can find a bill of sale form at the governmental agency in charge of the item's registration.
However, if you need a customizable bill of sale used in Illinois, you can simply download one of the bill of sale templates available on our website.
It benefits both the seller and the buyer in the way that it outlines the main details of the transfer.
For example, if any damage is later discovered on the item, the buyer can raise a claim against the seller if it’s not properly disclosed in the bill of sale. On the contrary, it protects the seller from any claims for the disclosed damages.