Equipment Bill of Sale
State of [State]
County of [County]
The Seller: [Seller’s name], [Who Seller], with a mailing address at [Address], [City], [State] [ZIP Code].
The Buyer: [Buyer’s name], [Who Buyer], with a mailing address at [Address], [City], [State] [ZIP Code].
The equipment. The Seller hereby sells, grants, and conveys to the Buyer all of the Seller’s rights, title, and interest in, to, and under the equipment described herein and all manufacturer warranties, if any, in favor of the Seller in effect for the following equipment (collectively referred to as the "Equipment"):
Type: [Type]; Make: [Make]; Model: [Model]; Serial number: [Serial number]; Price: $[Price].
Additional specifications: [Other features]
Total price of the Equipment: $[Total price].
Sales tax. The sales tax applicable to this sale is [Sales Tax Included Purchase] included in the purchase price of the Equipment. The parties agree that the payment of all other taxes shall be covered by the [Who Should Cover All].
Warranty. This Bill of Sale covers [Many Pieces Equipment Shall] piece(s) of equipment. Warranty terms: [Warranties Does Seller Make]. Transfer timing: [Date Transfer]. The Seller affirms legal ownership of the Equipment and asserts the right and authority to sell and transfer the Equipment. The Equipment is being sold on an as-is condition, where-is basis, and with all faults.
This Bill of Sale shall be effective as to the transfer of the Equipment as of [Effective date].
IN WITNESS WHEREOF, this Bill of Sale is executed in [Place of execution].
The Seller
Name: [Seller’s name]
Date: [Effective date]
The Buyer
Name: [Buyer’s name]
Date: [Effective date]
Party 1
________________
Signature
Date: ________________
Party 2
________________
Signature
Date: ________________
What Is a Equipment Bill of Sale?
An Equipment Bill of Sale in the United States evidences a sale of personal property, confirming the buyer's title once the purchase is complete.
For equipment sales, the UCC provides default rules regarding warranties, risk of loss, and remedies that apply unless the parties expressly modify them in their agreement. Under UCC Section 2-314, a seller who is a merchant with respect to goods of that kind provides an implied warranty of merchantability, meaning the equipment must be fit for the ordinary purposes for which such goods are used. Under UCC Section 2-315, if the seller knows the buyer's particular purpose and the buyer relies on the seller's expertise to select suitable equipment, an implied warranty of fitness for a particular purpose arises.
Equipment financing and leasing adds another layer of legal complexity. Under UCC Article 9, a secured party may hold a security interest in equipment as collateral for a loan. Before purchasing used equipment, a buyer should conduct a UCC-1 filing search with the applicable Secretary of State's office to determine whether any existing security interests or liens encumber the equipment. Purchasing equipment subject to an undisclosed security interest may result in the buyer losing the equipment to the secured creditor.
When Do You Need a Equipment Bill of Sale?
A business is selling used equipment such as machinery, tools, computers, restaurant equipment, or medical devices to another business or individual and needs documentation of the sale for tax, accounting, and legal purposes. A construction company is selling heavy equipment (excavators, loaders, cranes) to another contractor and needs to document the transfer of ownership, equipment condition, and any remaining manufacturer warranties.
A company going through downsizing, relocation, or closure is liquidating its equipment assets and needs bills of sale for each piece of equipment sold. A farmer or rancher is selling agricultural equipment (tractors, combines, implements) and needs documentation for the transaction, including any outstanding liens from equipment financing.
An equipment dealer or auction house is facilitating the sale of used equipment and needs standardized documentation for each transaction. A business is acquiring equipment from another company as part of an asset purchase and needs bills of sale for each category of equipment to support the purchase price allocation required under IRC Section 1060.
A company is donating equipment to a nonprofit organization or educational institution and needs documentation for the charitable contribution deduction under IRC Section 170, including the equipment's fair market value and the donee's acknowledgment.
What to Include in Your Equipment Bill of Sale
The seller's and buyer's full legal names, addresses, and tax identification numbers (EIN for businesses, SSN for individuals) must be stated. For business entities, the authorized representative who has authority to sell the equipment on behalf of the entity should be identified.
The equipment description must be specific and complete, including the type of equipment, manufacturer/make, model number, serial number, year of manufacture, capacity or specifications, current condition, and location of the equipment. For multiple items, a detailed schedule or inventory list should be attached as an exhibit. Photographs of the equipment at the time of sale are valuable supplements.
The purchase price, payment method, and payment terms must be stated. For installment sales, the payment schedule, interest rate (if any), and default provisions should be specified. For trade-ins, the trade-in value and description of the traded equipment should be documented. The sales tax obligations should be addressed, noting whether the buyer claims an exemption under their state's manufacturing, agricultural, or resale exemptions.
Warranty provisions must clearly state whether the equipment is sold as-is (with conspicuous disclaimer language per UCC Section 2-316) or with express warranties. If warranties are provided, the coverage scope, duration, exclusions, and remedy limitations should be specified. Any remaining manufacturer warranty that transfers with the equipment should be identified.
Lien and encumbrance representations are essential. The seller should warrant that the equipment is free of all security interests, liens, and encumbrances, or must disclose any existing liens. The buyer should independently verify by conducting a UCC-1 filing search with the Secretary of State. The bill of sale should require the seller to provide UCC-3 termination statements for any existing filings.
Both parties must sign and date the document. The seller should provide the buyer with any operating manuals, maintenance records, inspection reports, warranty documents, and keys or access codes. For equipment subject to regulatory requirements (elevators, pressure vessels, medical devices), compliance certificates and inspection histories should be transferred.
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Reference this free template in an article, syllabus, or research note:
Forms Legal. (2026). Equipment Bill of Sale (United States) [Legal document template]. Forms Legal. https://forms-legal.com/usa/personal/bills-of-sale/bill-of-sale-equipment
"Equipment Bill of Sale (United States)." Forms Legal, 2026, https://forms-legal.com/usa/personal/bills-of-sale/bill-of-sale-equipment.
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title = {Equipment Bill of Sale (United States)},
year = {2026},
howpublished = {\url{https://forms-legal.com/usa/personal/bills-of-sale/bill-of-sale-equipment}},
note = {Free legal document template. Based on Uniform Commercial Code (UCC §2)}
}Also available for these jurisdictions:
Frequently Asked Questions
An equipment bill of sale is legally binding once the seller and buyer sign it with accurate information about the equipment and the sale. The document records the transfer of ownership of machinery, tools, or business equipment and serves as the buyer's primary proof of ownership, since most equipment is not titled like vehicles. A complete equipment bill of sale identifies each item by make, model, year, serial number, and condition, states the purchase price, and includes the sale date and signatures. Under Article 2 of the Uniform Commercial Code, the sale of equipment is governed by sales law, including rules on warranties and the passing of risk. For financed equipment, the buyer should confirm there is no existing UCC lien. Because the bill of sale records price, condition, and serial numbers, it protects both parties if the sale of the equipment is later disputed and supports insurance and depreciation records.
Checking for a lien before buying equipment protects the buyer from acquiring machinery that secures someone else's loan, which a lender could repossess. Most equipment financing is secured by a lien filed under Article 9 of the Uniform Commercial Code, and these UCC-1 financing statements are recorded with the secretary of state in the seller's state. The buyer can search the state's UCC database, usually online, by the seller's exact legal name to see whether any active lien covers the equipment. Confirming the serial numbers and the seller's identity helps match any filing to the specific items. If a lien exists, the buyer should require the seller to obtain a payoff and a lien release, or have the lender release the collateral, before paying. Recording the cleared status on the equipment bill of sale and keeping the release protects the buyer's ownership.
Buying equipment 'as-is' means the buyer accepts the machinery in its current condition with no warranty from the seller about its working order, reliability, or hidden defects. Under Article 2 of the Uniform Commercial Code, conspicuous 'as-is' language disclaims the implied warranties of merchantability and fitness for a particular purpose, and courts readily enforce such disclaimers between businesses. The equipment bill of sale should state the as-is term clearly so the buyer's acceptance of the risk is documented. Because equipment can have wear, worn parts, or imminent failures that are costly to repair, the buyer should inspect and, where possible, test the machinery before purchase. An as-is clause does not protect a seller who conceals a known defect or misrepresents the equipment's hours, history, or condition, since fraud claims survive the disclaimer. Reviewing maintenance records helps the buyer assess the equipment's true condition.
An equipment bill of sale should include the full names and addresses of the buyer and seller, a detailed description of each item, the purchase price, the date of sale, and both signatures. The description should list the make, model, year, serial number, and condition of each piece of equipment so the items can be identified precisely for ownership, insurance, and tax purposes. The document should state whether the sale is as-is or includes any warranty, and should confirm that the equipment is free of liens or identify any that will be released. Recording included accessories, attachments, or software, and noting the method of payment, helps prevent disputes. Because equipment is often a depreciable business asset, the bill of sale supports the buyer's basis and depreciation schedule. Accuracy in serial numbers and price is important, since the document is the main ownership record for untitled equipment.
Whether sales or use tax applies when buying equipment from a private seller depends on the state and the nature of the transaction. Many states impose use tax on equipment purchases even from private parties, calculated on the price shown in the bill of sale, while some exempt occasional or casual sales between non-dealers. Equipment used directly in manufacturing or farming may qualify for an exemption with the proper certificate, and resale purchases by a registered business can be exempt. The buyer typically self-reports and pays use tax to the state revenue agency when no sales tax was collected at the time of purchase. Because exemptions for manufacturing, agriculture, and resale can significantly reduce the tax, and because rules vary widely by state, the buyer should confirm the applicable tax treatment and any required exemption certificate with the state revenue agency before or shortly after completing the purchase.
This template is provided for informational purposes only and does not constitute legal advice. Laws vary by jurisdiction and change over time. Consult a qualified attorney for advice specific to your situation.Full disclaimer
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