A boat bill of sale is the document that records the transfer of a vessel from seller to buyer, and it is the core paper your state will demand before it puts the registration in your name. Get the fields right, get both signatures on it, and — where your state requires — get it notarized. A single wrong digit or missing signature is enough to send the whole application back.
What the Document Has to Contain
The bill of sale needs to describe one specific boat in enough detail that a state agency can match it to that hull and no other. The single most important identifier is the hull identification number. Federal regulation requires every manufacturer to permanently affix a HIN to each boat produced or imported,1eCFR. 33 CFR 181.23 – Hull Identification Numbers Required and the primary HIN sits on the starboard side of the transom, near the top, where it can be read without moving the boat.2eCFR. 33 CFR 181.29 – Hull Identification Number Display Copy it character by character. A transposed digit will either bounce the application or, worse, tie your registration to somebody else’s boat.
After the HIN, the form should carry the year, make, model, and overall length. For anything with an engine, list each motor’s serial number and horsepower. Then the human details: full legal names and mailing addresses of both buyer and seller, the purchase price, and the date of the sale. The price is not filler. It usually determines how much sales or use tax you owe when you register.
Most state agencies that handle boat titling publish a fill-in template on their website. Use your state’s form when one is offered, because it captures the exact fields that state wants to see. Fill it out in permanent ink or type it. Strike-throughs and write-overs give clerks a reason to reject the filing.
Signatures and Notarization
Both buyer and seller must sign. The signatures are what make the transfer legally effective; without both, the document has no force and no state agency will process it.
Notarization is a separate question, and it depends on your state. Several states require a notarized bill of sale before they will title a boat, especially for older vessels without an electronic title record or vessels that were previously registered in another country. Where notarization is optional, it is still worth doing. It adds a layer of fraud protection and heads off later disputes about who signed what. State-set notary fees for a standard acknowledgment generally run between $2 and $25 per signature.
Check for Liens Before You Pay
The most expensive mistake in a private-party boat sale is skipping the lien check. If the seller still owes money on the vessel, the lender’s lien follows the boat no matter what the bill of sale says. You can pay the full asking price and still lose the vessel to the lienholder.
How you check depends on how the boat is registered. For a state-titled vessel, contact the titling agency in the state where it is currently registered and ask for a title search. A clean title will show no liens, or will show prior liens as satisfied. For a federally documented vessel, request an Abstract of Title from the Coast Guard’s National Vessel Documentation Center; the abstract lists all recorded mortgages and encumbrances.3United States Coast Guard. National Vessel Documentation Center If anything shows up, make the seller produce a lien release before you hand over money, or walk.
Sales and Use Tax
Most states tax boat purchases, and the bill of sale is what fixes the taxable amount. Rates and collection methods vary, but the general rule is that you owe tax to the state where the boat will be principally used, not necessarily the state where you signed the papers.
When you buy in one state and register in another, the registration state typically charges a use tax at its own rate and gives you credit for sales tax already paid at the point of purchase. If the purchase state’s rate was lower, you pay the difference. If it was higher, you generally do not get a refund. Some buyers try to avoid use tax by keeping the boat out of their home state for a set period, but most states have rules that close that gap, and the penalties tend to exceed the tax that was owed.
Tax is normally collected when you submit the registration application, so bring the original bill of sale showing the purchase price. If the state suspects the reported price on a private sale is below market, it can assess tax on fair market value instead.
Submitting Everything for State Registration
Federal law requires every undocumented vessel with propulsion machinery to be numbered by the state where it is principally operated.4Office of the Law Revision Counsel. 46 USC 12301 – Numbering Vessels In practice you register with your state’s wildlife, natural resources, or motor vehicle agency, depending on the state.
A typical submission packet includes the signed bill of sale, a completed registration application, proof of sales or use tax payment, and the registration fee. Some states also want the previous owner’s title certificate with the assignment section signed over to you. Many agencies now take scans through a digital portal; others still require original ink signatures by mail.
Registration fees vary widely and are often calculated on vessel length, type of propulsion, or both. Processing runs at least a few weeks in most places. If the agency finds errors, you get sent back to correct and resubmit, which restarts the clock. Verify every field before you send anything.
When You Need the Coast Guard Form Instead
Not every boat gets a state bill of sale. Vessels of at least five net tons owned entirely by U.S. citizens or qualifying entities can be documented through the U.S. Coast Guard rather than carrying state numbers.5Office of the Law Revision Counsel. 46 USC 12103 – General Eligibility Requirements Five net tons is smaller than it sounds; many recreational boats in the 25-foot range qualify. Owners choose documentation for conclusive proof of U.S. nationality for international travel, access to preferred ship mortgages, and unrestricted interstate commerce.6United States Coast Guard. National Vessel Documentation Center Frequently Asked Questions
Transferring a documented vessel takes a specific federal bill of sale, Coast Guard Form CG-1340, not a generic state form. The CG-1340 must show the vessel’s documented name, official number or HIN, the legal names and addresses of all sellers and buyers, the interest being transferred, and the purchase price. It must be notarized, and no alterations are permitted after execution and acknowledgment. A bill of sale that is not filed with the NVDC is considered invalid against anyone except the seller or a person who had actual knowledge of the sale,7United States Coast Guard. Bill of Sale CG-1340 so file it promptly.
Federal documentation does not wipe out state obligations. Documented vessels still comply with the laws of the state where they operate, and many states require them to display state decals even though they carry a federal number.8United States Coast Guard. Documentation and Tonnage of Smaller Commercial Vessels – Tonnage Guide 5
The Trailer Needs Its Own Bill of Sale
A boat trailer is a separate vehicle under the law and needs its own title and registration, independent of the boat. If a private seller is including a trailer, you need a separate bill of sale or a separately assigned title for it. The trailer’s VIN, usually stamped on the frame near the tongue, has to appear on that paperwork.
Trailer registration goes through your state’s motor vehicle department, not the wildlife or boating agency. Fees are modest in most states, though they vary by trailer weight. If the seller cannot produce a trailer title, things get harder: some states will accept a VIN inspection by law enforcement plus a sworn affidavit of ownership, others will not register a trailer without a title at all. Confirm the trailer’s title status before you agree to buy.
What You Receive After Registration
Once the state processes your application, you get back several items that together prove the boat is legal to operate:
- A Certificate of Number, which is your registration card. Federal regulation requires it on board in hard copy or digital form whenever the vessel is in operation, with a narrow exception for vessels under 26 feet leased for noncommercial use for fewer than seven days, where the certificate can stay on shore with the owner.9eCFR. 33 CFR 173.21 – Certificate of Number Required10Federal Register. Digital Certificate of Number for State Numbered Vessels
- A title certificate, if your state titles watercraft, issued either to you or, when there is a lien, directly to the lienholder.
- Validation decals showing that registration is current, applied to the vessel according to state instructions.
Your assigned number then has to be displayed on each side of the forward half of the hull, in plain vertical block characters at least three inches tall, in a color that contrasts with the hull.11eCFR. 33 CFR 173.27 – Number Display Faded, undersized, or badly placed numbers are among the most common citations written during on-water enforcement stops. Apply them correctly the first time and replace them when they start to deteriorate.