California Bill of Sale Requirements for Acquisitions

A California bill of sale needs to show who sold what to whom, when, and for how much, and for a vehicle or vessel it has to be submitted to the DMV alongside the endorsed title, an odometer disclosure, a smog certificate, use tax, and the transfer fee within 10 days of the sale. The California bill of sale requirements are light on the document itself and heavy on everything that travels with it, especially when a car, truck, motorcycle, or boat changes hands. Get the paperwork wrong and the DMV rejects the transfer; miss the deadline and the penalties compound fast.

What the Document Itself Must Contain

A bill of sale is the buyer’s primary proof of legal ownership, so it has to stand on its own if anyone later questions the transfer. At a minimum it should include:

The full legal names and current physical addresses of both the seller and the buyer.
A detailed description of the property, including serial numbers, model numbers, or any other identifying marks.
The exact date of the transaction and the purchase price. If no money changed hands, the document should say “gift” and state the estimated fair market value.
A statement about the property’s condition at the time of sale, usually an “as-is” disclaimer meaning the buyer accepts all existing faults.

For general personal property such as furniture, equipment, or electronics, any written document meeting those requirements works. California does not mandate a specific form for non-vehicle property. The document simply needs to establish a clear chain of ownership between the two parties.

Vehicle and Vessel Bills of Sale

For a car, truck, motorcycle, or boat, the DMV publishes an official Bill of Sale (REG 135), but any bill of sale that properly identifies the vehicle or vessel is acceptable.¹ On top of the standard buyer and seller information, a vehicle or vessel bill of sale needs the unique identifiers: the Vehicle Identification Number (VIN) for a car or the Hull Identification Number (HIN) for a boat, along with the license plate or registration (CF) number.²

To actually transfer a California-registered vehicle, the buyer has to submit the full package to the DMV:

The Certificate of Title (pink slip), properly endorsed by the seller, with the buyer’s name, address, and driver’s license number filled in on the new registered owner section.
The bill of sale, showing purchase price and date.
An odometer disclosure, entered on the title or on a Vehicle/Vessel Transfer and Reassignment Form (REG 262) if the vehicle is less than 20 model years old.
A valid smog certificate or evidence of exemption.
A lienholder release, if the title shows a lienholder, either on the title itself or via a Lien Satisfied/Legal Owner/Title Holder Release (REG 166).
The transfer fee plus applicable use tax, or evidence of tax exemption.

The base transfer fee is $15.³ A Statement of Facts (REG 256) is not required for a standard private-party purchase; the DMV asks for it in specific situations like gifts, trades, family transfers, estate transfers, and name changes.⁴ Boat buyers also need to submit an Application for Vessel Certificate of Number (BOAT 101) and proof of ownership such as the original California Certificate of Ownership or an out-of-state title.⁵

Odometer Disclosure

Federal law requires an odometer reading for any vehicle less than 20 model years old at the time of transfer.⁶ That threshold moved from 10 to 20 years on January 1, 2021, which means in 2026 every 2007-and-newer vehicle still needs the disclosure. California applies the same 20-model-year rule.⁷

The seller records the mileage on the title or on a REG 262 form, and both parties sign. If the odometer has been replaced or is known to be inaccurate, the seller has to note that. Falsifying an odometer reading is a federal crime, so a seller who resists giving a clear disclosure is a warning sign.

Smog Certificate Before You Sign

Almost every vehicle transfer in California requires a smog check, and the seller is the one responsible for providing the certificate. A car that passed smog two years ago still needs a fresh certification for the ownership transfer, which is where a lot of private deals stall.⁸

A handful of vehicles are exempt from the smog check at transfer:

Gasoline, hybrid, and alternative-fuel vehicles four model years old and newer skip the check but owe a smog transfer fee to the DMV instead.
Gasoline, hybrid, and alternative-fuel vehicles of model year 1975 and older.
Diesel vehicles of model year 1997 and older, or with a gross vehicle weight rating over 14,000 pounds. Newer diesels have no model-year exemption.
Electric vehicles and motorcycles are fully exempt.
Transfers between immediate family members skip the smog check, though every other transfer requirement still applies.

If the seller cannot produce a passing certificate and the vehicle is not exempt, the DMV will reject the title transfer. Confirm smog status before any money changes hands.

Signatures and Notarization

Both parties must sign the bill of sale. For a vehicle or vessel transfer, the seller also endorses the Certificate of Title by signing the release section while the buyer fills in and signs the new owner section.

California does not require the bill of sale to be notarized or witnessed.¹ For a high-value transaction, notarizing it is still worthwhile. A notary independently verifies the identities of the signers and the date of execution, and a notarized document carries more weight in court than bare signatures do.

The 10-Day Deadline and Penalty Ladder

Any change in vehicle ownership must be reported to the DMV within 10 days of the sale, and the title has to be updated.⁴ Missing the window triggers escalating penalties. For a vehicle already registered in California, the ladder runs:⁹

1 to 10 days late: 10% of the vehicle license fee and weight fee, plus a $10 registration late fee and $10 CHP late fee.
11 to 30 days late: 20% of those fees, plus $15 each for the registration and CHP late fees.
31 days to one year: 60% of those fees, plus $30 each.
One to two years: 80% of those fees, plus $50 each.
Over two years: 160% of those fees, plus $100 each.

Because the penalties are percentages of the vehicle license fee, the dollar impact depends on the car. On a newer vehicle with a high license fee, a few weeks of delay can cost hundreds of dollars.

Use Tax on Private-Party Purchases

Buy a vehicle, vessel, or aircraft from a private party and the seller does not collect sales tax. You owe use tax instead, paid directly to the DMV when you transfer the title. The rate equals the combined state and local sales tax rate at the address where you register the vehicle.¹⁰

California’s base sales tax rate is 7.25%, and most areas add local district taxes on top. The tax applies to the full purchase price, including cash, assumed loans, and the fair market value of anything traded as part of the deal. Writing a lower price on the bill of sale to shrink the tax bill is fraud, and both the DMV and CDTFA flag suspiciously low reported prices.

Gifts and Family Transfers

Transferring a vehicle or other personal property as a gift still requires a bill of sale. For a vehicle, write “gift” as the purchase price on the title and provide the vehicle’s estimated fair market value on a Statement of Facts (REG 256).¹¹ Transfers between immediate family members may qualify for a use tax exemption, though the transfer fee and other DMV fees still apply, and the smog check is waived while every other transfer document is not.⁸ For a non-vehicle gift, the bill of sale should state clearly that no money changed hands and describe the property in enough detail to prevent future disputes.

Check for Liens Before You Pay

A bill of sale does not wipe out an existing lien. If the seller still owes money on a vehicle and a lender holds the title, that lender’s interest survives the sale. Before paying, check the Certificate of Title for a listed lienholder. If one appears, the seller needs to either pay the loan off first or arrange a simultaneous payoff at closing.

For extra protection, buyers can pull a vehicle history report through the National Motor Vehicle Title Information System (NMVTIS), a federal database that flags title brands like salvage or flood damage, outstanding liens, and theft records.¹² For non-vehicle personal property like business equipment, UCC filings through the California Secretary of State show whether a security interest has been recorded.

The Seller’s 5-Day Release of Liability

Sellers have their own deadline. Within five calendar days of the sale, the former owner must submit a Notice of Transfer and Release of Liability (REG 138) to the DMV, either by mail or online.¹³

Until the DMV records reflect the new owner, the seller remains the registered owner on file, and parking tickets, toll violations, and accident liability can land on the seller if the buyer stalls on registering. A seller who delivers both the vehicle and a properly endorsed title and files the REG 138 on time is shielded from civil and criminal liability for the new owner’s use of the vehicle.²

1
California Department of Motor Vehicles. 1.020 Bill of Sale (VC 1652)
2
California Department of Motor Vehicles. Notice of Transfer and Release of Liability
3
California Department of Motor Vehicles. Registration Fees
4
California Department of Motor Vehicles. Title Transfers and Changes
5
California Department of Motor Vehicles. Boat and Vessel Registration
6
eCFR. 49 CFR Part 580 – Odometer Disclosure Requirements
7
California Department of Motor Vehicles. Vehicle Industry Registration Procedures Manual – Disclosure Requirements
8
California Bureau of Automotive Repair. Smog Check: When You Need One and Whats Required
9
California Department of Motor Vehicles. Penalties
10
California Department of Tax and Fee Administration. Tax Guide for Purchasers of Vehicles
11
California Department of Motor Vehicles. 11.015 Basic Transfer Requirements (VC 5603, 5751, and 5753)
12
U.S. Department of Justice (Office of Justice Programs). VehicleHistory
13
California Department of Motor Vehicles. Vehicle Industry Registration Procedures Manual – Notice of Transfer and Release of Liability