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A bill of sale may be required when selling a car, depending on the state or country. It provides protection for both the seller and buyer by helping reduce fraud, settling disputes, and ensuring secure payment. While it acts as proof of purchase, it does not establish ownership. Key components typically included in a bill of sale are the transaction date, names and addresses of both parties, a description of the vehicle, and the VIN number. Some states may have additional requirements, such as documenting or submitting the bill of sale.