Buying a gun from a private FFL holder? READ THIS FIRST!

[treemanx]

Cool, thanks for doing the leg work on that BCP. Theres alot more to this that I thought....

 

[tionico]

OK, so besides one's premises being open to govamint inspection, and no more FTF sales, what other rights does one surrender or have limited when one gets a FFL?

Can one use a separate building on one's property than the residence, say a separate shop building, making THAT the business property, thus exempting the home from inspection and recording of one's private collection?

I know about the records, they have to be kept for 20 years, and surrendered to ATF when the business closes for any reason. Not a big deal, just the ledger book with all recorded transactions (in- and out-bound firearms). Let's see, at $20 the transaction, one would have to do ten to pay for the one time fee, and another five a year to pay the anual.
OK, next question: for a Washington resident, what sorts of hoops does our fair state put a citizen through (premises requirements/restrictions, extra licenses/permits/inspections, taxes, insurance, bonds, firstborn sons, etc, do THEY require? This is something I've been thinking about myself......

 

[Hill]

If you are not intending to operate an ongoing business for profit you are NOT going to be issued a class 01 dealer FFL........Period.

Before a license is issued BATF agents WILL visit your intended place of business to see that you have a business plan, have all required licensing from your local and state agencies, have secure storage of any firearms on premises and any which may be temporarily on premises, that you have satisfied any and all local zoning, fire inspection, parking requirements that may be stipulated by the local business regulators that oversee such stuff at your location. They will question you as to your understanding of all laws that will govern your activities and will want to see that you are completely ready to take all steps in compliance with the complicate regulations that pertain. They'll want to see that you have any and all required signage on display.

If you plan to operate the business from your home all of the above still applies and in addition the business location will need to be a clearly seperate section of your home, preferably a building on your property which is not the building where you and your family reside, but if it is an attached sction it's preferred that it have a seperate entry and not be normally accesible from inside the house. A locking door can satisfy this, but it can come down to the way your visiting agents read their law sometimes whether they sign off on you, and you'll be left to argue your case with their superiors if you can.

You are not going to be able to decide one day that "Gee, wouldn't it be great if I could buy me and my friends all these neat guns at dealer cost - I think I'll get me an FFL!! Whiz Bang and Whoopee" BATF will be too polite to laugh in your face, but you can bet they'll joke about you in their office.

 

[Hill]

BATF is a taxing agency. They collect federal excise taxes. That's their job. Think of them as a different kind of IRS. Do you like the IRS? You'd better, because they'll be poking at your pie too. How about your state franchise tax board, or whatever it's called in your state? Like them? You'll learn to not like them pretty quickly. Then there's the local tax collector. These yokels can be easy to take or they can be major PITA's. Either way, they will want some of your pie too.

By the time your done for a year you'll look at it all and ask yourself "WTF was I thinking - I'd take home more money as a cashier at the local 7-11"

 

[tionico]

What is likely another important piece of fruit to inspect before adding it to this pie is the narrow markup possible on firearms.

Chatting with some of the "official" FFL dealers, it seems the markup which the market will bear on new firearms is somewhere between 8% and 12%. In other words, you PAY $100 for that gun, and can only sell it for about $112. Out of that $112 Washington State happily takes about a buckanahalf because you had retail sales (their miserable B&O tax, on the GROSS SALES VOLUME, not the profit). You've paid inbound shipping, prolly another fifteen bucks.. opps, you are now operating at a negative profit, better hurry up and get a whole lot more customers to fix that.....

Cabelas, Sportsmans Warehouse, and even the small MumnDad outfits areall at about the same margin. Ever notice, even the high volumme online folks that advertise their wares on gunbgoker, auctionarms, their prices on those nice new Brownings and Colts are all within a very narrow band of numbers.
Now, consider what happens when you invest, say, five thousand in inventory this week. Whatever is not sold by this time next year, you pay inventory tax on (not sure, but the precentage is too high), AND you've absorbed the cost of "flooring" that merchandise... at the very least, you've lost whatever interest could have been gained by having it in a CD, MM account, or wherever you keep uneeded cash. Most likely, you've BORROWED that five G to invest in your business.... at which point, considering your interest costs to floor it, and the narrow margin you've been allowed by the market, well, selling guns out of your garage might not be the best idea.

Of course, if you're sharp and can buy privately used guns at bargain prices, then fip them, perhaps your margins will be a lot more workable.

To do this as a part time hobby might work... to prevent death from boredom in retirement. But it looks like for one to depend upon the income possible from such an operation might not be wise.

Best is to thoroughly investigate the NUMBERS, and let THEM do the talking. Of course, if things DO fall apart, as many predict they will, having a large and well-stocked gunroom available for resale might be a good thing. If things REALLY fall apart, perhaps folks like the ATF and the local tax goon squad mightn't have the resources to be poking about, inspecting records, checking inventory, and the like. Most of those guys, if their paychecks would cease arriving, they'd not bother to show for work. Then, who will pay their fuel to get about poking their noses in such things?

Seems a sticky bit, at best.

Now, perhaps if one had contacts offshore, and therefor access to large quantities of AK's, perhaps the importer's class of license might be a worthwhile path to persue. But I rather expect they'd be somewhat harsh on anyone contemplating THAT line of work right about now.

 

[jackofalldaves]

if i am a regular joe,how many firearms may i buy and sell in a years time without any kind of license? theres got to be some limit, and do you have to claim profit?

 

[Gov't Mule]

...

So I drove for 2 1/2 hours last night, to get to his house, to pay for my gun. After finally getting there, the seller has me fill out the background check forms, fingerprints me, and takes my money. But when he tries to call in the background check with OSP, hes told that they dont have his FFL info on file.

...

I'm not in Oregon, but is this standard practice for every firearm transferred in the state?

 

[TonsOfOregonBrass]

I'm not in Oregon, but is this standard practice for every firearm transferred in the state?

Thumb prints yes. all ffl firearm transfers must have thumb prints taken.

As for the number of guns before needing a license. There is no set max or min number of guns, but if you are buying and selling for a profit on a regular basis you technically need to be licensed.

There is some good info, and some miss info in this thread about getting your FFL.

 

[tionico]

Thumb prints yes. all ffl firearm transfers must have thumb prints taken.



I've bougth a number of long guns in Oregon (somehow the "shall not be infringed", and the "not interfere in interstate commerce" bits of the Constitution are twisted to forbid me purchasing handguns across state lines, but, so far at least, long guns are OK... unless you live in that other country directly south of Oregon.

In the process to purchase these, all from FFL dealers, I do not recall ever having any prints taken.

Now, when I applied for my OR CHL, that's another story.. full set, just like I was being registered as an honoured guest at the local Greybar Hotel. But that's another matter. Getting the CHL, they REALLY want the full monty on you. They have to think long and hard before Mother says Yes You May.

but simply buying a firearm?

Now I DO know that Oregon State Police insist on middling the FBI background check.... a stupid waste of public funds, as if THEM making the call will turn up anything the dealer making the call would (as in Washington). But, if OSP have no record of his being an FFL Dealer, it is safe to say he is not one... and thus should have proceeded with the sale as a private seller, still legal.

but FINGERPRINTS? Naaaahhhhhhh I doan t'eeenk so, Paco

 

[Atroxus]

If you are not intending to operate an ongoing business for profit you are NOT going to be issued a class 01 dealer FFL........Period.

Before a license is issued BATF agents WILL visit your intended place of business to see that you have a business plan, have all required licensing from your local and state agencies, have secure storage of any firearms on premises and any which may be temporarily on premises, that you have satisfied any and all local zoning, fire inspection, parking requirements that may be stipulated by the local business regulators that oversee such stuff at your location. They will question you as to your understanding of all laws that will govern your activities and will want to see that you are completely ready to take all steps in compliance with the complicate regulations that pertain. They'll want to see that you have any and all required signage on display.

If you plan to operate the business from your home all of the above still applies and in addition the business location will need to be a clearly seperate section of your home, preferably a building on your property which is not the building where you and your family reside, but if it is an attached sction it's preferred that it have a seperate entry and not be normally accesible from inside the house. A locking door can satisfy this, but it can come down to the way your visiting agents read their law sometimes whether they sign off on you, and you'll be left to argue your case with their superiors if you can.

You are not going to be able to decide one day that "Gee, wouldn't it be great if I could buy me and my friends all these neat guns at dealer cost - I think I'll get me an FFL!! Whiz Bang and Whoopee" BATF will be too polite to laugh in your face, but you can bet they'll joke about you in their office.

Could your indended business be just processing FFL transfers for a fee? For example not actually buying/selling any firearms. Just charging like $20 per transaction to do the transfers for people.

To get dealer costs for weapons wouldn't manufacturers require bulk purchases, and/or contracts to buy x number of guns per month/year to get those prices? Or is the FFL all that they require?

 

[tionico]

Atroxus, I don't know what BATF would think about operating solely as a transfer dealer.. but trust me, handling all that paperwork, hassle, inspections, filings, etc, would NOT be worth it for the twenny bux each..... Please, you dealers who DO this as a courtesy/favour/service, don't stop..... we APPRECIATE your hard work and hassle. But to do this exclusively, and for $20, is NOT a viable business plan.

Some manufacturers deal directly with dealers, some through distributors. Some distributors deal in several makes. Then, there are always used weapons.. I know of a few FFL dealers who also trade in used.... online, face to face, auctions, buying estates and collections and breaking them up, that sort of thing. There is also a trade in older military weapons, many of which are C&R class arms.
I suspect part of why BATF are so harsh and niggly is they are not keen on having every Tom, Dick, and Harry trading in arms..... they prefer only those who are conducting a serious business, and can demonstrate they will conduct themselves professionally. Don't anyone tell THEM this, but I am actually amazed they will even approve anyone to work such a business out of the same property where they live. I was in the automotive trades for years, falling back to a sort of backyard shadetree operation. Most of my best vendors refused to continue trading with me.. they will NOT supply a business run out of the same property where the owner lives. California thinking, most made this change after a buyout by some other outfit based in California. A friend in the pro bicycle business has found the same thing. So, we should be very glad BATF have not taken this stance, and continue to allow small operators to work from their residence property. Perhaps they remember that John Moses Browning began his gunsmithing career out of the barn on the homestead..... some traditions die hard.... which is a good thing.

It does make sense they want the "gunroom" separate from the actual dwelling space, too. Makes things a bit safer for both the guns on hand, and for the residents. Someone wants GUNS, theyll stop at nothing... thus the folks may well be at risk. Or, conversely, someone housebreaking just may find they've hit the jackpot when they go into that spare bedroom and find piles of firearms and ammunition lying about.....

Except for their near-SS style intimidation and discretionary power, they are actually doing a decent job... although if I were president, one of the federal agencies I'd do away with is the BATF & E.... likely leaving some folk to deal with the E section. I mean, Class B Fireworks aren't exactly the sort of thing should be piled into the spare bedroom in one's home. Nor should any yahoo handle them at will. But the rest? WHY does a Federal agency need to oversee tobacco and alcohol, let alone arms....... goes back to Prohibition... booze and guns ran together. If you want to control the one, the other is involved. But we repealed that barmy ammendment, didn't we? Proof once more that once a government agency is created, it always grows. Never shrinks, and oh my, NEVER disappears.

 

[Atroxus]

Atroxus, I don't know what BATF would think about operating solely as a transfer dealer.. but trust me, handling all that paperwork, hassle, inspections, filings, etc, would NOT be worth it for the twenny bux each..... Please, you dealers who DO this as a courtesy/favour/service, don't stop..... we APPRECIATE your hard work and hassle. But to do this exclusively, and for $20, is NOT a viable business plan.

The $20 was just a number I saw elsewhere in the thread and re-used. I was just more curious about the legality of getting an FFL for a transfer only business. I would think that to really be worth it as a legitimate profit turning business you would have to do an extremely large number of transfers even if you were charging $40 dollars or more per transfer. However if it was legal and your only goal was to break even on the FFL licensing fees and maybe make some pocket change in order to not have to pay FFL fees for yourself and your friends/family it could work. The key being if it would be legal of course. Then again I am not sure many people would be flocking to get their FFL transfers done out of someone's house when they could be done at a reputable business with a store front.

 

[mpmax]

Getting back to the original issue....Sounds like the FFL hadn't set up an account with OSP for the background check. They do this over the phone on a credit card. Private Citizens can use the service too for the same fee. If Mr. Personality (FFL) hadn't been guilty of "contempt of cop", he may have been able to accomplish the task.