Free Alabama Car Bill of Sale
Alabama does not publish an official bill-of-sale form, and needs a bill of sale only in some situations — for a vehicle not covered by its title law, or as proof of the price for the casual sales tax unless the buyer accepts the state's standard value. The critical paperwork is the title application (Form MVT 5-1E), which the buyer completes through the county license plate issuing official to obtain a new title. Sellers must physically remove their license plates before handing over the keys, because Alabama plates stay with the seller, not the vehicle.
Free PDF includes a light diagonal watermark. Go Pro to remove it. Already subscribed? Sign in.
Alabama Car Bill of Sale — What You Need to Know
Sales Tax Details
Alabama levies a 2% state sales tax on vehicle purchases. County and city automotive rates are added on top and vary — for example, the Department of Revenue lists 0.75% for Jefferson County and 2% for the City of Birmingham — so the combined rate can be well above 4% depending on where the buyer lives.
Exemption: Whether a family gift is exempt from the casual sales tax, and what proof is needed, is set by the Alabama Department of Revenue — ask the county licensing official before relying on it.
Inspection Requirements
Alabama has no statewide safety or emissions inspection requirement for privately sold vehicles.
Alabama Car Sale — Step-by-Step Checklist
- Write a bill of sale capturing: full legal names and addresses of buyer and seller, VIN (17 characters), year, make, model, odometer reading, sale price, and sale date.
- Sign the back of the existing Alabama certificate of title in the designated seller signature block — do not use correction fluid or cross out errors.
- Remove your license plates from the vehicle before transfer; plates belong to the seller in Alabama and must not be left on the car.
- Provide the buyer with the signed title, the bill of sale, and any lien-release documentation if a lienholder was listed on the title.
- Buyer takes the signed title to the county license plate office within 20 calendar days of the sale date, where the title application (Form MVT 5-1E) is completed.
- Buyer pays the applicable 2% state sales tax plus any county/municipal add-on at the county license plate office when applying for the new title.
- Seller keeps a record of the sale date and buyer (the signed bill of sale) to protect against post-sale liability for tickets or damage.
- Both parties keep a copy of the signed bill of sale for at least seven years for tax and liability records.
Common Pitfalls
- Leaving the plates on the car: Alabama plates are registered to the owner, not the vehicle. A seller who lets the buyer drive away with the plates can be held responsible for tolls, red-light camera violations, and worse.
- Missing the 20-day registration deadline: Alabama charges a penalty when a newly acquired vehicle is not registered within 20 calendar days. The clock starts on the date of acquisition, not the date the buyer gets around to visiting the office.
- Skipping the odometer disclosure on the bill of sale: federal law (49 U.S.C. § 32705) requires a written odometer statement for vehicles of model year 2011 or newer. Omitting it can expose the seller to federal odometer-fraud liability.
- Assuming notarization is required: Alabama does not require a bill of sale to be notarized for a standard private car sale, but both parties should still sign in person and retain originals.
- Paying off a lien but forgetting the lien-release letter: if the title shows a lienholder, the seller must obtain and present a lien-release letter from the lender before the county license plate office will issue a clean title to the buyer.
Pro Tip
Pro tip: complete the paperwork the same day as the handover. Alabama's 20-day window for title transfer sounds generous, but county license plate offices in smaller counties may have limited hours, and delays compound quickly. Sellers should photograph the signed title and the vehicle's odometer reading before handing over the keys — a timestamped photo protects against any later dispute about the car's condition or mileage at the time of sale.