So I have been looking into applying for a 01 FFL to do strictly transfers out of my residence. I have already started the process of creating a LLC. I understand that you can not use the 01 FFL for the sole purpose of enhancing your own personal collection, but my question is roughly how many transfers would I have to conduct every month or year so the ATF would see it as a legitimate business? Also I would like to get my 03 SOT so I could get a hold of post 86 mg's. My other question is do you have to conduct a certain amount of class 3 transfers so the license is not revoked? In other words, it is it okay to have a 03 SOT for the purpose of having post 86 mg's?


Thanks

So I have been looking into applying for a 01 FFL to do strictly transfers out of my residence. I have already started the process of creating a LLC so it would be a legitimate business.
You can be legit as a sole proprietor also.



I understand that you can not use the 01 FFL for the sole purpose of enhancing your own personal collection, but my question is roughly how many transfers would I have to conduct every month or year so the ATF would see it as a legitimate business?
at least one every 3 yrs i have NEver SEEN a number SET to this.


Also I would like to get my 03 SOT so I could get a hold of post 86 mg's. My other question is do you have to conduct a certain amount of class 3 transfers so the license is not revoked?
no again 500bucks a year and try to sell should be fine.


In other words, it is it okay to have a 03 SOT once you have a 01 FFL for the purpose of having post 86 mg's?

you can NOT have  the 3 sot lic WITH OUT the FFL 1st...

I was informed that creating a LLC is necessary for any home FFL other than a 03

For the last part I was just asking if its okay to have a 03 SOT just to acquire a few post 86 mg's. I understand you have to have the 01 FFL first and a LEO letter...

Whoever told you that is a complete and total idiot and should be punched in the throat and never consulted about firearm matters again.
there is no Federal law or ATF regulation that dictates ANY type of business structure. ATF doesn't give a rats ass.
<----01FFL/SOT who is a sole proprietor

   
Why are you asking "if its okay"?
It's "okay" because that's the only way you'll be able to receive NFA transfer tax free. SOT is Special Occupational Tax and paid yearly.

Are you asking if paying the SOT once will allow you to buy a few posties and then keep them? If so......NO. You'll have to sell/transfer those post '86 machine guns as soon as you fail to renew your FFL or fail to pay your SOT the next year.

Post '86 machine guns can only be acquired by an 01FFL/SOT who provides ATF with a law enforcement demonstration letter. this means you'll have to find a local CLEO who wants you to demonstrate a particular machine gun.

I understand that any post 86 mg's will have to be sold when I do not renew the SOT. But what I am unsure about is if it is okay to get a 03 SOT for the sole purpose to acquire just a few post 86 machine guns. I would not plan on selling/transferring NFA items like suppressors to individuals. I would get it just so i could posses a few post 86 mg.

I think that everyone reading your posts understands the true reason you want an FLL, and it's not for operating a business.  How long will it take the ATF to figure this out?  Who knows?  It could be during the application process, it could take several years, or you may get away with it until you die and your family is left with your mess to clean up.

I'm not trying to be rude, but what part of my previous replies do you not understand?

1. An 01FFL (Dealer in Firearms) is a Federal Firearms License for those who are engaged in the business of dealing in firearms.
2. Paying the Special Occupational Tax allows a licensee to engage in the business of dealing in NFA firearms.
3. ATF Form 7 (Application for Federal Firearms License) Question 18. Do You Intend To Make a Profit from Your Business?......if no do not submit application.
4. Question 19.  Do You Intend to Use Your License Only to Acquire Personal Firearms?.....if yes do not submit application.
5. Using your SOT solely to acquire NFA firearms for "personal use" may likely be construed as tax evasion as you do not actually intend to be in the business of dealing in firearms. It's tax evasion because you did not pay the ATF tax stamp on each NFA transfer.
6. You say your intent is to get the SOT just so you could possess a few post 86 machine guns..........which means you have no intent to actually deal in such firearms. While there is no requirement to actually "demonstrate" or actually sell/transfer such firearms, an LE demonstration letter is required to transfer post 86 NFA firearms to you. It isn't much of a stretch for ATF to suspect you lied when you submitted the LE letter. ie your statement above that you do not plan to sell/transfer NFA items.

If you think this scheme will work ask yourself one question..........is it worth it?
If ATF discovers you lied on your FFL app, that you lied on your LE demo letter, that you are unlawfully possessing a post '86 machine gun, that you evaded Federal tax.......they'll likely charge you with a felony and more likely several felony charges. You will spend tens of thousands of $$$$ on attorney fees. If convicted you will be required to dispose of all your firearms and never be able to buy or possess a firearm again.

The TL/DR version.........FFL/SOT is for engaging in the business. As you do not intend to do so, stick with fully transferrable NFA firearms.

You are not understanding what im asking.... Can someone get a SOT JUST to acquire 1 or 2 post 86 mg. Im not asking about a 01 FFL or obtaining suppressors/sbr under a form 3 to avoid tax. Thats all very clear to me..

1. I intend to make a profit with the 01 FFL by doing transfers. Im am not getting a 01 to enhance my own collection.
2. If I want to own suppressors or sbr's I would file the appropriate paperwork as an individual and pay the tax, so that I can be on the safe side. A individual can not file a form 4 or 1 on a post 86 mg so how could this be tax evasion? The only part that would interest me in getting a SOT is to obtain 1 or 2 post 86 mg. I have no interest in enhancing my suppressor or sbr collection with my SOT.
4. If i was able to find an agency that would write a demo letter, and I actually held a demo for them, how would this be a lie? I think it would be a very far stretch to claim that its a lie if a demonstration was actually held. And if the agency happened to be interested in purchasing that type of firearm, then great. But its not something im betting on. The ATF would have no grounds to conduct any kind of legal action. And it certainly would not be unlawful possession of a machine gun if the ATF approved the transfer. When I said I do not intend to sell/transfer NFA firearms, I mean for civilian sale. Such as selling a suppressor to someone.

If I am actively engaged in the business of transferring firearms under my 01 FFL, what would be the issue in acquiring the SOT just to obtain 1 or 2 post 86 mg? It would not be tax evasion for my case because I would file a form 1 or 4 for anything personal and pay the tax stamp.

Honestly I do understand your point, but im trying to be realistic about it and what the ATF would consider unlawful. A 01 FFL to enhance a collection? Yes that is clear and I don't dispute that. But a SOT for the main purpose of acquiring 1 or 2 post 86 mg? Idk, it seems like a grey area and im trying to find a clear answer.

How do you know what the true reason is? You are not me, so don't claim that you know. I DO want to obtain my 01 FFL SO that I can operate a legitimate business of transferring firearms to individuals. I DO intend to make a profit with my FFL, which makes your response invalid and irrelevant. What I am asking is about becoming a SOT just to obtain 1 or 2 post 86 mg.

As I posted in the closed thread, No.

You might want to read ATF Ruling 76-22:

The Bureau has had occasion to consider the status of a person who represented himself as a dealer; registered and paid the special (occupational) tax, imposed under 26 U.S.C. 5801, as a “dealer” in firearms as defined in section 5845(a) of the National Firearms Act (Chapter 53, Title 26, U.S.C.), made application for and was duly issued a license as a “dealer” under Title I of the Gun Control Act of 1968 (Chapter 44, Title 18, U.S.C.); and it was subsequently established that the person procured the special tax stamp and the license to facilitate the purchase of firearms for his personal collection.

Held, the mere possession of a license and a special (occupational) tax stamp as a dealer in firearms does not qualify a person to receive firearms transfer-tax-free. Any person holding a license and a special tax stamp as a dealer in firearms and not actually engaged within the United States in the business of selling NFA firearms may not lawfully receive NFA firearms without the transfer tax having been paid by the transferor. Where it is, therefore, determined that the proposed transferee on a Form 3, Application for Tax-exempt Transfer of Firearm and Registration to Special (Occupational) Taxpayer, is not actually engaged in the business of dealing in NFA firearms, such application will be denied. In addition, if such person receives NFA firearms without the transfer tax having been paid, such firearms may be subject to seizure for forfeiture as having been unlawfully transferred without payment of the transfer tax.

Rev. Rul. 58-432, 1958-2 C.B. 875 (Internal Revenue), is superseded.

And there it is.  If you have no intent to sell firearms, you cannot have an FFL and therefore cannot be an SOT.  /thread

OP said he DOES intend to sell/transfer Title I firearms.
For some reason he doesn't want to sell/transfer Title II toys.

Well that's just silly.

Yup

The ruling is more specific than that.  As noted, the OP wants to sell Title I firearms, but not Title II firearms.  The ruling (specifically, what I bolded above) says that the FFL/SOT does not, by itself, qualify you to receive NFA firearms tax-free; you must be engaged in the business of selling NFA firearms.  I guess it leaves open the question of whether OP could legally receive a post-86 dealer sample on a Form 4 with the SOT, but it seems pretty obvious what ATF's position is going to be on that too.

This, there's tons more markup in Title II stuff.