Taxes for building an AR rifle

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[ARCHIVED THREAD] - Taxes for building an AR rifle

Posted: 2/6/2006 8:15:10 AM EDT

I can buy a lower receiver from a local shop. I'm buying the entire AR rifle kit less the stripped lower receiver online. The lower has never been built up.

When I asked how much the lowers stripped were going for, I was told the price and then told that the tax had only been paid on the lower receiver.

My question is, what would the tax be to assemble the rest of the rifle with the lower receiver, or is there a tax cost for me to assemble this?

Help!

Posted: 2/6/2006 9:25:27 AM EDT

[#1]

You pay tax on the lower as you are buying it local, you do not pay tax on the kit, as you are purchasing it online.

There is no additional tax paid.

Posted: 2/6/2006 9:57:26 AM EDT

[#2]

Stick.. I think the tax the dealer mentioned isis the FET tax.

This FET is not assessed to individuals who assemble their own firearm from parts for personal use and not for sale, so you don't have to worry about it. The FET (11-12%) is only due on a complete firearm, and is paid by the manufacturer/assembler or builder (so its included in the retail price of the firearm). Even the lower you bought didn't have an FET as it is a component, not a complete firearm, so your dealer doesn't know what he is talking about.

Other than any sales tax you may run into when purchasing your parts, there is no other tax due when you assemble a firearm for yourself.

Posted: 2/6/2006 10:11:18 AM EDT

[#3]

Quoted:
You pay tax on the lower as you are buying it local, you do not pay tax on the kit, as you are purchasing it online.

There is no additional tax paid.

+1

you are building a kit and you are not a manufacture making and selling the ar's

Posted: 2/6/2006 11:23:47 AM EDT

[#4]

I appreciate the responses from everyone!

This helps me a lot!

Posted: 2/6/2006 11:26:57 AM EDT

[#5]

Your dealer may be trying to add taxes to your purchase that he si not required/entitled to collect.

If you build the rifle for personnal use and decide to sell it at some time in the future, you do not have to pay FET on it then either. But if you do this too often, you may be accused of being a manufacturer and not collecting/paying the FET by the BATFE. Kinda like selling to many used cars in a single year. Cross the line on how many and your a dealer.

Posted: 2/6/2006 11:40:57 AM EDT

[#6]

I may have worded my question incorrectly, please read below.

This is what my brother said.

"the lower is the part that's actually considered the 'gun.'
if it's a stripped lower, yes- ya gotta pay manufacturing tax, just to put in trigger and springs.
buy a complete lower- no tax.
the uppers can be switched any way, any configuration you want, as long as it keeps your gun
a legal rifle or pistol- whichever the lower is registered for."

Is this correct? do I have to pay a manufacturing fee if I buy a stripped lower receiver and then buy a kit separate and assemble?

Sorrry if I'm asking the same question twice. You know its all in the wording sometimes!

Posted: 2/6/2006 11:54:49 AM EDT

[#7]

No, you are fine. The only time it would matter is if you were building and selling them, however, you aren't doing that.

FET is NOT applied to a stripped lower, but rather, only to a complete firearm.

FET is the tax you are mentioning.

Posted: 2/6/2006 12:17:41 PM EDT

[#8]

Think I got it now.

Look down to subchapter B - subsection 5852. I think this states what you were saying Stickman and others.

its the section under general provisions and exemptions!

Posted: 2/6/2006 12:18:59 PM EDT

[#9]

Whoops! forgot to put the link to the ATF site.

subchapter B - subsection 5852 on the website below.

http://www.atf.gov/pub/fire-explo_pub/2005/p53004/26usc_chap53.pdf

Posted: 2/6/2006 2:26:23 PM EDT

[#10]

By Texas Law you must pay a Use Tax on personal purchases over the Internet. This is equivelant to the State Sales Tax. If you are not doing this you are a Tax Cheat and you are breaking the law. I speak for Texas residents only. Check out your own state laws.

Posted: 2/6/2006 6:39:43 PM EDT

[#11]

My local fuck face FFL gave me the same line of BS, he said stripped receivers are for replacement only and that it is infact illegal the "build" a rifle and that the only reason they sell them is because "all of these guys say their receiver cracked and they need a new one", I guess that's what he makes his customers say before he"ll order one for them?

I quickly said "It is NOT illegal to build a rifle, it says so on the ATF website!", to wit he quickly replied "Actually...................it is, because you are the manufacturer, wich you need a license for and you owe to tax on it then!". I never even mentioned 80% receivers and ya know what, I walked right out of the dick heads shop. FUCK HIM! He seemed like the kind of "nervous Nelly" that would call the feds for nothing

Posted: 2/7/2006 4:26:51 AM EDT

[#12]

Quoted:
By Texas Law you must pay a Use Tax on personal purchases over the Internet. This is equivelant to the State Sales Tax. If you are not doing this you are a Tax Cheat and you are breaking the law. I speak for Texas residents only. Check out your own state laws.

Can you point us to a reference on that?

ETA - Found it.

www.window.state.tx.us/taxinfo/sales/faq_use.html#use3

3. Do I owe tax on goods purchased via mail-order catalogs or Internet merchandise?
Yes. A seller who uses catalogs or the Internet to sell goods is treated the same as any other seller of taxable items. If you purchase merchandise through a catalog or the Internet from a seller located in Texas, you owe Texas sales tax on the purchase. If you purchase merchandise through a catalog or the Internet from a seller located outside of Texas and use the taxable item in Texas, then you owe Texas use tax on the purchase. An out-of-state mail-order company or an Internet company may hold a Texas Sales and Use tax permit and collect Texas tax. If the out-of-state seller does not have a Texas permit or does not collect Texas use tax, the use tax is due and payable by the purchaser.

4. How do I report a use tax liability?
If you have a sales tax permit and bought goods or services that are subject to use tax, you must report your purchase on your Texas sales tax return on line 3, "taxable purchases."

If you do not hold a Texas sales and use tax permit and you bought items on which the seller did not collect Texas sales or use tax, you must report your purchases on form 01-156, Texas Occasional Use Tax.

If you paid another state's sales or use tax on the merchandise, you can take a credit for the amount of sales tax paid to the other state.

Posted: 2/7/2006 5:57:47 AM EDT

[#13]

Quoted:
Quoted:
By Texas Law you must pay a Use Tax on personal purchases over the Internet. This is equivelant to the State Sales Tax. If you are not doing this you are a Tax Cheat and you are breaking the law. I speak for Texas residents only. Check out your own state laws.

Can you point us to a reference on that?

ETA - Found it.

www.window.state.tx.us/taxinfo/sales/faq_use.html#use3

3. If you purchase merchandise through a catalog or the Internet from a seller located outside of Texas and use the taxable item in Texas, then you owe Texas use tax on the purchase.

Yeah, this tax gets paid ALL THE TIME by us Texans!!

Posted: 2/7/2006 6:04:59 AM EDT

[#14]

I was going to say, how the hell would the state of TX know. Thats a lot of sales to track.

Posted: 2/7/2006 6:07:20 AM EDT

[#15]

Quoted:
Quoted:
Quoted:
By Texas Law you must pay a Use Tax on personal purchases over the Internet. This is equivelant to the State Sales Tax. If you are not doing this you are a Tax Cheat and you are breaking the law. I speak for Texas residents only. Check out your own state laws.

Can you point us to a reference on that?

ETA - Found it.

www.window.state.tx.us/taxinfo/sales/faq_use.html#use3

3. If you purchase merchandise through a catalog or the Internet from a seller located outside of Texas and use the taxable item in Texas, then you owe Texas use tax on the purchase.

Yeah, this tax gets paid ALL THE TIME by us Texans!!

This is just to prove the point while you are bitching about dealers you are breaking the law yourself. I guess it is like speeding, as long as you don't get caught it's fine. When you are caught, shut up and pay the fine.

Posted: 2/7/2006 3:43:58 PM EDT

[#16]

When the poster isn't from Texas, what does Texas sales tax have to do with anything?

Posted: 2/7/2006 3:51:57 PM EDT

[#17]

Quoted:
When the poster isn't from Texas, what does Texas sales tax have to do with anything?

Most states have the same law. Many posting here are from Texas.

Posted: 2/7/2006 4:07:16 PM EDT

[#18]

[ARCHIVED THREAD] - Taxes for building an AR rifle

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