California Release of Liability — Protect Yourself After Selling a Vehicle
Selling a car in California is not complete until you file a release of liability. Without it, you remain legally tied to the vehicle — meaning toll violations, parking tickets, accidents, and even lawsuits can follow you. This guide covers the exact form, deadline, and process for California.
California: File online (recommended)
Form: REG 138 (Notice of Release of Liability) — Deadline: 5 days from date of sale
Step-by-Step: Filing Release of Liability in California
- 1
Complete the bill of sale
Write a dated bill of sale capturing the VIN, sale price, buyer's name and address, odometer reading, and both signatures. Print two copies — one for each party. California does not have an official bill of sale form, so a typed document with both signatures is legally valid.
- 2
Sign the title over to the buyer
On the back of the California Certificate of Title, fill in the buyer's name, address, odometer reading, sale date, and sale price. Sign where indicated as the seller. In some states, both parties must sign before a notary.
- 3
Handle license plates
California plates stay with the VEHICLE. Do not remove plates. The new owner uses them until they re-register.
- 4
File the REG 138 (Notice of Release of Liability)
Online at dmv.ca.gov — fastest and most recommended. Must be submitted within 5 days of the sale.
- 5
Notify your insurance company
Remove the vehicle from your policy effective the sale date. Request written confirmation and file it with your bill of sale copy.
- 6
Monitor for post-sale notices
For the next 30–60 days, watch for toll bills, parking violations, or renewal notices addressed to you for the sold vehicle. Respond with your filing confirmation and bill of sale.
California-Specific Information
5 Mistakes That Leave Sellers Liable
Letting the buyer drive away with your plates
Consequence: Any toll, red-light, or parking violation the buyer incurs gets mailed to you.
Fix: Remove plates before handoff in states where plates stay with the owner (TX, FL, NY, PA, IL, and most others). Check your state's specific rule.
Skipping the release of liability filing
Consequence: You remain on record as the legal owner. Future violations, tows, and accident lawsuits can name you.
Fix: File REG 138 (Notice of Release of Liability) online or by mail within the required window. Most states allow online filing in under 2 minutes.
Not keeping a copy of the bill of sale
Consequence: Without a dated, signed document, you have no proof of the sale date or the buyer's identity.
Fix: Print two copies at the point of sale. Both parties sign both. Each keeps one. Photograph it with your phone.
Forgetting to notify your insurance company
Consequence: You continue paying premiums on a vehicle you no longer own. Worse, if the vehicle is in an accident, your policy may be implicated.
Fix: Call or log in online to your insurer the same day as the sale. Get written confirmation.
Signing the title before receiving payment
Consequence: Once the title is signed and in the buyer's hands, they legally own the vehicle — payment disputes become civil collection issues.
Fix: Sign the title only when cash, certified check, or wire transfer is confirmed cleared.
Plate Rules by State — Quick Reference
One of the most common post-sale mistakes is leaving plates on the vehicle. Rules vary significantly by state.
| State | Plates Stay With | Remove Before Sale? |
|---|---|---|
| California | Vehicle | No — plates transfer with car |
| Texas | Owner | Yes — remove before handoff |
| Florida | Owner | Yes — remove before handoff |
| New York | Owner | Yes — required by law |
| Pennsylvania | Owner | Yes — remove before handoff |
| Illinois | Owner | Yes — remove before handoff |
| Ohio | Owner | Yes — remove before handoff |
| Michigan | Owner | Yes — remove before handoff |
| Washington | Vehicle | No — plates transfer with car |
| Arizona | Vehicle | No — plates transfer with car |
| Georgia | Owner | Yes — remove before sale |
| North Carolina | Owner | Yes — remove before handoff |
| Tennessee | Owner | Yes — remove before handoff |
| Colorado | Owner | Yes — remove before handoff |
Frequently Asked Questions
What is a release of liability in California?
A release of liability is a notification to the California DMV that you have transferred ownership of a vehicle. It formally removes your name from the vehicle's registration record so you are no longer legally responsible for what the new owner does with the car.
What form do I file in California?
In California, the primary document is the REG 138 (Notice of Release of Liability). Online at dmv.ca.gov — fastest and most recommended. Must be submitted within 5 days of the sale.
What if I don't file the release of liability in California?
Failure to file REG 138 leaves the seller financially liable for any parking tickets, toll violations, red-light camera fines, or even accidents caused by the new owner. California DMV will NOT automatically transfer liability — the seller must file.
Do I keep my license plates in California?
California plates stay with the VEHICLE. Do not remove plates. The new owner uses them until they re-register.
How long does the buyer have to transfer the title?
5 days from date of sale. If the buyer misses this deadline, they face the late transfer penalties — not you — provided you properly signed and delivered the title and filed any required seller notification.
What if I receive a ticket for the car after I sold it?
Present your filed release of liability confirmation number plus your dated, signed bill of sale to the issuing authority. In most states, this is sufficient to dismiss the violation. If the authority refuses, contact the California DMV directly with both documents.
Generate a California Bill of Sale
Start with a professional, state-specific bill of sale before you file your release of liability.
Create California Bill of Sale