View Full Version : Thinking About Applying For An FFL
I'm thinking about applying for an FFL. HELP!
My 20 year retirement is coming up and I've been kicking around ideas for what my next job/career will be. Over the past few years I've built several ARs for coworkers (and myself) and I really enjoy it. I usually have the person buy the lower and pick it up so that it's registered to them and they give it to me and I build the rifle. This has me thinking about getting my own FFL so that the lowers (and other firearms) could be shipped directly to me and if I charge a transfer fee that goes in my pocket instead of someone else's. Do any of you all do this? I seem to remember a few years ago the BATFE changed some things that either made it harder or flat out denied new FFLs for home-based businesses or something like that. What am I up against here? Is it worth it? I need y'alls thoughts and experiences!
My business partner and I are at the beginning stages of opening a shop.
I’ve talked to my local pd, county sherif, and the ATF. No issues (for us) to have a home ffl.
Five_Point_Five_Six
06-19-20, 11:36
I'm thinking about applying for an FFL. HELP!
My 20 year retirement is coming up and I've been kicking around ideas for what my next job/career will be. Over the past few years I've built several ARs for coworkers (and myself) and I really enjoy it. I usually have the person buy the lower and pick it up so that it's registered to them and they give it to me and I build the rifle. This has me thinking about getting my own FFL so that the lowers (and other firearms) could be shipped directly to me and if I charge a transfer fee that goes in my pocket instead of someone else's. Do any of you all do this? I seem to remember a few years ago the BATFE changed some things that either made it harder or flat out denied new FFLs for home-based businesses or something like that. What am I up against here? Is it worth it? I need y'alls thoughts and experiences!
Do you actually need the business to make money or are you just looking for a retirement hobby business?
Do you actually need the business to make money or are you just looking for a retirement hobby business?
Probably just for some side cash, like transfer fees. Mainly to make it easier for me to build guns and get my own shipped directly to me.
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Whiskey_Bravo
06-19-20, 13:04
It is my understanding that the ATF has or at least did at one time crack down on kitchen table FFLs that are just using it as a hobby but I could be wrong. Maybe someone like Steyr can chime in.
If you get them to do it (Doubtful) that still doesn't make it a legitimate business. Business licences, insurance and tax collection make it difficult survive in a nickle and dime operation. The IRS frowns upon businesses that don't show a profit. Ask me how I know!! BTW, what you are doing now is not legal.
You first need to look into your area & if a conditional use permit can be obtained to run your business out of a residential...ATF was great & very helpful but they aren't going to hand over your Lic until your've met every municipal, county, state, etc requirement you need. Getting the lic was a cinch vs going through the CUP. Not sure what an 07 lic costs only it's way more than an 01 but what you will need for mfg.
I would contact your area ffl & have a visit.
You first need to look into your area & if a conditional use permit can be obtained to run your business out of a residential...ATF was great & very helpful but they aren't going to hand over your Lic until your've met every municipal, county, state, etc requirement you need. Getting the lic was a cinch vs going through the CUP. Not sure what an 07 lic costs only it's way more than an 01 but what you will need for mfg.
I would contact your area ffl & have a visit.
What’s the definition of “manufacturing” a firearm? The “firearm” is the lower. I’m not making any lowers.
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Diamondback
06-19-20, 17:01
What’s the definition of “manufacturing” a firearm? The “firearm” is the lower. I’m not making any lowers.
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IIRC, and I can't quote a source, if you assemble more than a certain number for pay, they consider that "manufacturing." (Don't recall if it was ten career or ten per year; think the source was one or another of the various gunsmith FFLs I know.) This is ATF, you know how they are about making sense... LOL
IIRC, and I can't quote a source, if you assemble more than a certain number for pay, they consider that "manufacturing." This is ATF, you know how they are about making sense... LOL
Oh yeah, I understand that for sure.
At the current time, I’m not making any money for this.
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Diamondback
06-19-20, 17:17
In your position, the safe play as my humble eyes see it would be "have them attempt initial assembly themselves, then bring it to you for correction" or you build up the separate assemblies and sell them separately, then they pop the pins and join them on their own. You might need a Gunsmith FFL for that, though...
Five_Point_Five_Six
06-19-20, 17:24
IIRC, and I can't quote a source, if you assemble more than a certain number for pay, they consider that "manufacturing." (Don't recall if it was ten career or ten per year; think the source was one or another of the various gunsmith FFLs I know.) This is ATF, you know how they are about making sense... LOL
Oh yeah, I understand that for sure.
At the current time, I’m not making any money for this.
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You've been given some bad advice in this thread and I recommend you seek these answers out by a vetted professional in the matter. There are lawyers you can reach out to that deal in this type of thing.
I'd consider having this thread deleted since assembling guns for other people is murky waters even if you don't take any money for it.
Five_Point_Five_Six
06-19-20, 17:25
In your position, the safe play as my humble eyes see it would be "have them attempt initial assembly themselves, then bring it to you for correction" or you build up the separate assemblies and sell them separately, then they pop the pins and join them on their own. You might need a Gunsmith FFL for that, though...
Dude, just stop. You're giving terrible info.
It is my understanding that the ATF has or at least did at one time crack down on kitchen table FFLs that are just using it as a hobby but I could be wrong. Maybe someone like Steyr can chime in.
So the phrase that pays is "in business for profit." If that is the plan you are good, if the goal is hobby money that is a disqualifier. There is no established number of guns to satisfy a requirement.
First question is where does officerX plan on establishing his licensed premise. If it's at home you need to see if you can qualify for code and zoning for a firearms business at your home, if you cannot get that you cannot get anything. If you can get that, that is the most important part of being able to get a home based FFL.
But also consider, do you want ATF compliance inspections and ALL transfers to happen in your home?
In your position, the safe play as my humble eyes see it would be "have them attempt initial assembly themselves, then bring it to you for correction" or you build up the separate assemblies and sell them separately, then they pop the pins and join them on their own. You might need a Gunsmith FFL for that, though...
There is no such thing as a gunsmith FFL. Someone who is a gunsmith has the same 01 FFL as a firearms dealer.
The rule of thumb here is you can build anything you want for yourself but if you build anything, even a single firearm, with the intent to resell you are an unlicensed firearms dealer and that is very, very illegal.
I can't even do builds for resale with just a 01 FFL, I would need an 07 manufacturers license. And that includes simply buying an upper and a lower and putting it together. An 01 FFL is not allowed to do that, it is considered manufacturing and probably an attempt to avoid paying excise tax.
Probably just for some side cash, like transfer fees. Mainly to make it easier for me to build guns and get my own shipped directly to me.
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So on the interview, one of the specific questions is are you intending to get a FFL for your personal firearms question and if "yes" then the answer is "no."
You better be prepared to start a "good faith" firearms business with the intent to sell firearms for profit.
Well, sounds like I’m out! Thanks for the advice, guys.
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I'm thinking about applying for an FFL. HELP!
My 20 year retirement is coming up and I've been kicking around ideas for what my next job/career will be. Over the past few years I've built several ARs for coworkers (and myself) and I really enjoy it. I usually have the person buy the lower and pick it up so that it's registered to them and they give it to me and I build the rifle. This has me thinking about getting my own FFL so that the lowers (and other firearms) could be shipped directly to me and if I charge a transfer fee that goes in my pocket instead of someone else's. Do any of you all do this? I seem to remember a few years ago the BATFE changed some things that either made it harder or flat out denied new FFLs for home-based businesses or something like that. What am I up against here? Is it worth it? I need y'alls thoughts and experiences!
Assembling firearms will require an 07 MFG FFL. So the first order of business is to check your local zoning to see if you can have an 07 MFG FFL wherever you plan to open up shop. That is usually the biggest hurdle for most folks.
I suggest you write a business plan about what you want to do. Look at competitors in your area and what they charge offer, this will give you an idea of the viability of your plan.
As a former FFL, NO, just plain and simple NO! Can you do the kitchen table FFL? Yes.
The paperwork which changes frequently, inspections, etc. plus sales tax forms and state compliance, thankfully no county or city since our FFL was rural was not worth it over time.
Put simply, it is cheaper to pay a real storefront FFL for firearms transfers then to try and do it yourself. Unless you want to spend huge amounts of time jumping through the beaurocratic hurdles constantly to save insignificant amounts of money on your purchases, forget it.
If you are only doing small numbers of purchases, you and your customers will likely get better prices off Gunbroker. In times of crisis or general high volumes, distributors will supply their big customers first so, nothing will be left for you.
I made about 10X the profit selling knives versus firearms. I didn't need an FFL for knives. ;)
In times of crisis or general high volumes, distributors will supply their big customers first so, nothing will be left for you.
I made about 10X the profit selling knives versus firearms. I didn't need an FFL for knives. ;)
That is no joke. Trying to get a HK SP5, I have customers who were able to buy them faster from big name distributors and still NONE of my wholesalers has one in inventory.
Also when airsoft was kinda new and finally became affordable for ordinary people, I made more money that year selling high end Tokyo Maru guns than I did selling actual Colt rifles (or any other AR for that matter).
Another year I beat my gun sales selling DVDs online.
Each year I pretty much do a "at cost" group buy on whatever is the desirable suppressor so I can break into the 6 or more / 10 or more "stocking dealer" price so I can order a few for myself and some extras that can actually stand some kind of markup that isn't pointless. For anyone wondering, if a suppressor dealer prices at $800 the typical market price (what a person will actually pay) is usually around $850.
NFA stuff is the only thing worse than Title 1 firearms. Everybody wants SBRs. suppressors and MGs but nobody wants to pay what they cost. Transferable machine guns are actually the worst since there is no dealer price, I pay what everyone else pays and it's irritating to buy something for $8,000 and then have trouble selling it for $8,100.
The only real market is used guns and then you have to be "that guy" who will offer people crackhead prices for their guns. And after about a year of offering people 50% of what their gun would likely sell for on gunbroker, you get a rep as a "ripoff" gun guy so there really is no winning.
You can explain dollars and sense to people all day long but if you have a gun for $500 and somebody else has exactly the same thing for $480 everyone will be buying from somebody else.
Greg Kulbick
06-19-20, 23:33
Like has been said before, its gotta be a real business and when they come look at your books, they want to see stuff going in and out.
Be certain you want a FFL before you take the first step. If you ask ATF for a FFL packet, you will be assigned a FFL file number. I made an inquiry about securing a FFL license in 1993 and decided against it when I learned the city government where I lived established some draconian regulations.
I received an ATF trace request for a handgun several years later, because the wrong FFL number was entered on the transfer documentation. A FFL number was on the request, which did not match the inquiry FFL number assigned to me by ATF. I went through a lot of grief before the issue was resolved.
Don't contact ATF until you are dead certain you want a FFL.
Be certain you want a FFL before you take the first step. If you ask ATF for a FFL packet, you will be assigned a FFL file number. I made an inquiry about securing a FFL license in 1993 and decided against it when I learned the city government where I lived established some draconian regulations.
I received an ATF trace request for a handgun several years later, because the wrong FFL number was entered on the transfer documentation. A FFL number was on the request, which did not match the inquiry FFL number assigned to me by ATF. I went through a lot of grief before the issue was resolved.
Don't contact ATF until you are dead certain you want a FFL.
If you request a Form 7 Application for a FFL you won't be assigned anything.
If you submit a Form 7 Application for a FFL you will probably be assigned a pending FFL number.
If you request a Form 7 Application for a FFL you won't be assigned anything.
If you submit a Form 7 Application for a FFL you will probably be assigned a pending FFL number.
All I did was request a packet to apply for a FFL. I did not submit any paperwork from the packet and did not take any steps to obtain a FFL.
Several years later I received a ATF Trace Request for a handgun I did not order and knew nothing about. I went back and forth with ATF, then finally was able to make contact with a regulatory agent in my state about the trace request. I proved that our house had not yet been built and on the date ATF claimed a handgun was shipped to me the address was a vacant lot.
Once this issue was cleared up, the ATF agent told me a number was assigned to anyone who requested a packet to apply for a FFL and that was the reason a trace request was generated from their office in West Virginia. The whole ordeal occurred during Bill Clinton's term.
You can download the packet anonymously from atf, or obtain it from one of those services.
As for your 1993 experience, it sounds fishy. You did not even need fingerprints or photos or anything back then. Maybe some one got an fflI. Your name.
You can download the packet anonymously from atf, or obtain it from one of those services.
As for your 1993 experience, it sounds fishy. You did not even need fingerprints or photos or anything back then. Maybe some one got an fflI. Your name.
No. The FFL number was incorrect on the trace form. I found a local gun shop that had a FFL number that was close to the number that was assigned to my name. The number on the FFL posted on their wall was almost identical, with the exception of one character. The shop was known to be fast and loose with their paperwork and had been visited by ATF numerous times over the years. I avoided the shop, due to their reputation and had only been there a handful of times. I can't remember being in the shop without seeing at least one gang member.
No. The FFL number was incorrect on the trace form. I found a local gun shop that had a FFL number that was close to the number that was assigned to my name. The number on the FFL posted on their wall was almost identical, with the exception of one character.
They do not and never have assigned an FFL number for requesting an application, as the numbers are coded based on where the shop is located and what type you apply for. None of this info is available when you ask for an application. So either someone got an ffl in your name, or an error was made by atf.
Either way this 27 year old story has nothing to with today, since you can obtain an application anonymously.
They do not and never have assigned an FFL number for requesting an application, as the numbers are coded based on where the shop is located and what type you apply for. None of this info is available when you ask for an application. So either someone got an ffl in your name, or an error was made by atf.
Either way this 27 year old story has nothing to with today, since you can obtain an application anonymously.
Yep, otherwise I'd have a dozen FFL numbers as I have requested Form 7 applications for a lot of people.And this was in the late 90s. Also Shotgun News was full of "Become a FFL" packages complete with Form 7s and instructions on how to fill them out.
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