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Discussion in 'NFA/Class 3 & FFL Discussion' started by Alwayscarrying, Mar 1, 2012.
I want to start doing custom ar builds to make some extra money. Would i need an ffl to do this?
Many of us build our own ARs. If you buy a stripped lower, that is legally a firearm. It has the serial number already on it. Unless you are planning on manufacturing the stripped lower yourself there shouldnt be a problem.
Then again if you plan on buying and selling to make a profit that is another area I am not familiar with.
I recently bought a palmetto and several of my coworkers are jealous and want an AR of their own but dont have the money. Since Ive known the AR platform for quite some time i thought i might help out and build them for a bit cheaper and just get reimbursed plus a little extra for labor and time.
I would suggest that you get an FFL and business license.
Modifications can be construed as "manufacturing"
If you are "engaged in the business" of buying and selling guns, you need a Dealer's FFL. MAKING a firearm for sale- manufacturer's FFL.
"Engaged in the business" means devoting time and attention to it with the intention of making a livelihood. So says the ATF.
If I buy a gun, later decide I like something else and want to sell it- NOT engaged in the business. Even if I make a small profit.
I buy 6 guns, resell 5 of them to my friends in a short time- you are engaging in the business. There is no set number of guns or time. I know of one man charged after selling one gun. Bought it dirt cheap at a gun show, IMMEDIATELY put it up for sale at a higher price. Guy that sold it to him was an ATF agent.
"devoting time and attention to it with the intention of making a livelihood"
C3, couldn't that part cover other people as well? For instance, armorers, instructors, competitive shooters?
This is more a curiosity thing than anything else.
The people you mention arent selling firearms but firearm related products and services. Big difference
Well, C3 said " "Engaged in the business" means devoting time and attention to it with the intention of making a livelihood. So says the ATF."
That line doesn't specifically say sales, that's why I asked.
its referring to sales of actual firearms.
Dang. Thats a lot of info. Id just be be buying stripped receivers and building them from there. So a manufacturers ffl and a business license would pretty much do it?
Maybe insurance as well. With most states you can establish an LLC pretty easy for 50 bucks to a couple hundred (fees vary by state). You will also need a resale cert because you have to charge tax to residents. You are pretty much a gun store/manufacturer out of your house, but setting up your business assets away from your personal assets is a good idea in the event of a lawsuit or bankruptcy.
This is gonna be quite a bit on my wallet on my current pay lol
If I was assembling custom made anything, especially guns, I'd be buying liability insurance regardless of whether I was incorporated or not. Unfortunately, one thing we need to recognize is how anyone can be sued for pretty much anything. Even if the problem was a component failure out of your control, everyone involved gets named in suits. For example, if you were installing, say, Accu-Group trigger packages and there was a catastrophic failure and someone got hurt and sued, the shyster would name Accu-Group, the distributor you bought it from, and you. If your corporation has minimal assets, they would look to name anyone and anything they could to better guarantee the money. The more principals they name, the better the chance of a bigger payoff. That's often how it works. Personal injury cases generally net the law firm on the plaintiff's side 40% of recovered funds regardless of if a court judgment or out of court settlement. Yeah, if incorporated, you basically protect your personal assets in this case, but there's no absolute guarantee of anything, so why take the risk unprotected?
Very very true.
Couldn't you just show them what to buy, and help them build it/instruct them how to do it? That way they learn about the gun, and you are not selling them anything.
This only works if you don't mind not making a profit. If you do want to make a profit doing this, then I'm not sure what kind of FFL (if any) you would need since you would be an instructor, not a manufacturer.
If you actually want to make these and sell them, then you would need an FFL, possibly a business licence, and a TON of liability insurence.
Didnt think about that texas. Great idea.
AND- if you are planning to manufacture in your home, or sell with your home as your licensed presises, before the ATF will issue you a Manufacturer's or a Dealer's FFL, you will need to show them that you meet ZONING requirments to do that in your house.
And yes, Mason- the "It" I was referring to was in the line above that.