Is it worth being an FFL if you really don't intend to have a firearms store?

[IronMonster]

So I am toying with the idea of getting an FFL. I own a brick and mortar business location already which has a small machine shop as part of its operation. In the little Idaho town I am in (about 4000 people) there is one other FFL that has a actual store (a hardware store that really has no inventory)

The thing is other than maybe handing mail order transactions for folks I really don't think there is justification for a gun store here. Others have tried and failed several times. The other thing is I have a buddy that owns a gun shop 15 miles away who treats me pretty good.

One thing it would do for me is make firearms and related purchases legitimate business expenses. Being able to write off ammo would probably more than offset the cost of maintaining the FFL.

I guess I am looking for feedback as to others who are or have been in the same boat and real world experience

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[KeepnitReel]

I would do it before you might not be able too. Already having a place of business to qualify for the FFL is half the battle. I did the same thing for a vehicle wholesale license through my hot rod shop in Cali , never sold a car but it sure was nice not to pay license/taxes on purchases and pay just the usage fee's.

 

[Andy54Hawken]

Is there a niche market that you can fulfill?
And can it be worthwhile for you to do so?

I like the idea of a small gunshop ... But I wonder / worry if they are going the way of the Dodo bird.
Not trying to be a downer here ... sorry if my post comes across that way.
Andy

 

[IronMonster]

Being a realist and a downer are two very different things

There might be a niche but I suspect it would not really be a money maker in any real sense. The only good thing is the overhead is a fixed cost and trying to sell a bit of ammo and a few guns would not significantly change them. It would mostly be a glorified hobby justification "legitimizing" some of my expenses. I would like to manufacture some steel targets and think it would be a community service to have a spot you could buy ammo but most folks are happy to drive the 20 mins to Sportsmans Warehouse to do any real shopping.

 

[Member 3687]

I was a licensed dealer for 7 years doing what you are talking about. I was looking to buy more for myself than anybody else and I was also working out of my shop. Yes a lot of stuff can be a write off like a good safe for the business to keep any customer firearms and books in also an upgraded security system for the shop.

The trick is how you would right write off ammo for the business unless you could show a business need like a YouTube channel testing said ammo in various shop guns for advertisement and to show the quality of your products you can sell. Say you build an AR with a KAK flash can, Aero Lower and Faxon barrel well you can show how in this application each works and in order to do this you need to test said products and video tape it in use. I can see it working to your advantage.

Because you all ready have a business established that you are at you can set your businesses hours for a couple days a week and by appointment the rest of the time so the feds can check out your books if needed.
At the time I enjoyed it as I did not have to wait to deal with a third party to receive stuff like lowers and firearms and in reality I sold more fishing items than guns as I went to my job and put the catalog on the table and said 5 percent over cost and usually got enough in orders to pay for my license in less than a month with a little left over.

My problem is my Job went away and I had to give it up because I was never home or at the shop during set hours so it was not worth it any more that and Bill Clinton wanted to make it harder to be a dealer and wanted to charge 500 a year so it was no longer cost effective for me.

I would look into the cost of insurance because in this sue happy culture so it is a possibility. That could be the only cost that could make it an issue.

Is it worth it, If you feel you can pay for the license, insurance any upgrades to the shop for the license like a safe and you feel you could save money or have enough in writes off to cover any funds you now incur for your purchases then yes, if you would spend less just paying your buddy transfer fees then no.

 

[Flopsweat]

I was a licensed dealer for 7 years doing what you are talking about. I was looking to buy more for myself than anybody else and I was also working out of my shop. Yes a lot of stuff can be a write off like a good safe for the business to keep any customer firearms and books in also an upgraded security system for the shop.

The trick is how you would right write off ammo for the business unless you could show a business need like a YouTube channel testing said ammo in various shop guns for advertisement and to show the quality of your products you can sell. Say you build an AR with a KAK flash can, Aero Lower and Faxon barrel well you can show how in this application each works and in order to do this you need to test said products and video tape it in use. I can see it working to your advantage.

Because you all ready have a business established that you are at you can set your businesses hours for a couple days a week and by appointment the rest of the time so the feds can check out your books if needed.
At the time I enjoyed it as I did not have to wait to deal with a third party to receive stuff like lowers and firearms and in reality I sold more fishing items than guns as I went to my job and put the catalog on the table and said 5 percent over cost and usually got enough in orders to pay for my license in less than a month with a little left over.

My problem is my Job went away and I had to give it up because I was never home or at the shop during set hours so it was not worth it any more that and Bill Clinton wanted to make it harder to be a dealer and wanted to charge 500 a year so it was no longer cost effective for me.

I would look into the cost of insurance because in this sue happy culture so it is a possibility. That could be the only cost that could make it an issue.

Is it worth it, If you feel you can pay for the license, insurance any upgrades to the shop for the license like a safe and you feel you could save money or have enough in writes off to cover any funds you now incur for your purchases then yes, if you would spend less just paying your buddy transfer fees then no.

There you go. Do some extended use tests on various rifles. When was the last time you saw a 5000 round test on an AR? Somebody has to do it.

 

[IronMonster]

I figured if I was making steel targets that would be all the justification I need for business consumption of ammo

 

[clearconscience]

With all the guns and parts you buy, probably.

Your ammo could be a write off.

 

[Member 5605]

Other gun shops probably failed because it was their only income source.

If that's done for fun and not as a primary then go for it.

 

[mjbskwim]

As of right now we have one legitimate gun store in town. This has been a town of 3k average for ever. Our county is growing a little. One guy bought a shop 2 years ago and is now trying to sell. Then there is the cabinet maker that has a store also. But that his side job
Then there's Murdochs,a ranch store that sells guns.
I guessing IM that you are 20-30 minutes from Twin?
We are 2 hours from anywhere and these folks buy guns from out of town all the time. Most have kids in IF,Boise,Twin,or they go shopping in Missoula and stop at the many boxs stores up there.
The guy that is selling out had a maximum of 10 pistols at any time and maybe 20 long guns. No selection so no buyers.
I was thinking of buying the store but there isn't the inventory to justify the price.
So the point is will you store make a few bucks and have inventory or is this just for your self? Seems folks over here don't mind waiting or traveling to buy guns
But you have a money making business so you don't necessarily need to show profits with the gun shop for the tax man
Might as well try it out if it don't break the bank in license fees.

 

[HB of CJ]

Different point of view. Do not do it. The individual rights and privileges you enjoy right now might be lost forever in the maze and benign belligerency of the Federal, State and Local government mindset. Also consider all the licensing, inspections, duties and responsibilities of small business ownership. Consider the time required to maintain it all. For the potential benefits and brain tickling it is not worth it.

If you still consider doing it, try to completely separate the business physical location from your other personal property such as you home. Separate it all. All. You would be horrified to learn all the legal and other ways big brother has to destroy your Constitutional Rights. Mostly speaking it would not be your private small business. It would belong to Big Brother. Personal experiences. PEM if ya wanna. It's that bad.

Respectfully. Just me.

 

[eldbillbo]

Other gun shops probably failed because it was their only income source.

If that's done for fun and not as a primary then go for it.

That about sums it up.

 

[mjbskwim]

A guy back home sold his shop and gave up his ffl. I asked why and he said he didn't want the ATF to have the right to search his home. His claim was that if your home address is the address for your FFL,they have the right to search your home.
I can not verify that this is true,but something to think about.
I guess they could search your metal business and find some shavings?

 

[wired]

I did it for years. You can make a tidy little profit doing tranfers in Oregon and Washington and you dont need to keep ANYTHING in stock. Just order for others or let others order stuff for themselves. You'll make enough to buy a few guns a year and maybe even enough to pay for a Class 3 license.

As far as the ATF searching your home if you have a home business FFL the ATF doesnt search your house unless there is probable cause in which case they would be searching it anyway. It one of the truisms in life that if you have nothing to worry about you have nothing to worry about.

 

[Caveman Jim]

If the ATF finds anything not on the "Up n UP", I'm pretty sure they will visit your home residence....

Good luck with your decision IM.

 

[jbett98]

I would set it up as a separate LLC company just to firewall your personal finances.

 

[Member 3687]

When I had my license I never had issues with being inspected and 5 of the 7 years was in Washington State and the last two was in Idaho.

My shop was my business and separate from my house and for a short time I had an actual store front in Spokane without issue as well. You do need to keep personal firearms separate from store firearms. This is a gray area where I have seen some folks get into trouble because of the lack of paper trail.

But this was from a time that you could buy personal guns without a background check and 4473 in Washington so if said firearm was in your shop and not on the books how could you prove it was your personal firearm also when you sold said personal firearm it is a gray area as to if you need to run it through your business or not.

Being in Idaho it is the same issue if you buy a gun from someone for your personal use do you need to run it through your business or not. Gray area but to cover you're a$$ it is better to do so and have a paper trail as a legitimate transfer.

ATF has come into the sporting goods shop I worked at and did an inspection several times. As long as our paperwork and our inventory audit was good they left happy. We all carried firearms and where never questioned about them as being a part of the shop or personal I think they just assumed they where personal.

Keep it legit and all will be well try to play games and the will come down hard.

 

[Silver Hand]

Three words Liability.
Silver Hand

 

[Silver Hand]

When I had my license I never had issues with being inspected and 5 of the 7 years was in Washington State and the last two was in Idaho.

My shop was my business and separate from my house and for a short time I had an actual store front in Spokane without issue as well. You do need to keep personal firearms separate from store firearms. This is a gray area where I have seen some folks get into trouble because of the lack of paper trail.

But this was from a time that you could buy personal guns without a background check and 4473 in Washington so if said firearm was in your shop and not on the books how could you prove it was your personal firearm also when you sold said personal firearm it is a gray area as to if you need to run it through your business or not.

Being in Idaho it is the same issue if you buy a gun from someone for your personal use do you need to run it through your business or not. Gray area but to cover you're a$$ it is better to do so and have a paper trail as a legitimate transfer.

ATF has come into the sporting goods shop I worked at and did an inspection several times. As long as our paperwork and our inventory audit was good they left happy. We all carried firearms and where never questioned about them as being a part of the shop or personal I think they just assumed they where personal.

Keep it legit and all will be well try to play games and the will come down hard.

Put every gun in the house on the books and after doing so put your keepers in the safe with or without the others you may have for sale. If you are popped for an inspection a gun is a gun and it better be in the log personal or purchase, just list yourself as the owner and answer the remaining questions to the best of your ability. Like the one, where it was purchased and when. I had personal weapons and registered with approximate dates they were close to correct, when I was a dealer and never had a hitch with AFT.
Silver Hand

 

[notazombie]

Disclaimer; I have no firsthand FFL experience.

If you are primarily looking for write offs, couldn't you forego the FFL and just do the target manufacturing thing? Gotta do product testing, right? Can't do that without guns and ammo. Just seems to me that an FFL invites a lot more scrutiny as well as complication/hassle and cost. Keep your free-state lifestyle free.