How does NFA work when it's a DIY conversion?

Theohazard

New member
jabba21 said:
Prof Young said:
What does SOT stand for?
Special occupational tax. It's a tax FFLs pay to deal in or manufacture NFA items.
And to elaborate futher, that's where the term "Class 3" comes from, which is a term that's often misunderstood. A Class 3 SOT is the type of SOT that allows a dealer to sell Title II (NFA) firearms. But a lot of dealers that people refer to as "Class 3" dealers actually don't have a Class 3 SOT, they have a Class 2 instead. A Class 2 SOT is even better than a Class 3 because it allows the dealer to both manufacture and sell Title II firearms.
 

dogtown tom

New member
Theohazard........ A Class 2 SOT is even better than a Class 3 because it allows the dealer to both manufacture and sell Title II firearms.
Nope.
01FFL's....."Dealer"....gets a Class 3 SOT......it allows them to ONLY deal in NFA firearms.
07FFL's...."Manufacturer"......gets a Class 2 SOT....it allows dealing and manufacturing of NFA firearms.

An 01FFL cannot get a Class 2 SOT.
 

Theohazard

New member
dogtown tom said:
Nope.
01FFL's....."Dealer"....gets a Class 3 SOT......it allows them to ONLY deal in NFA firearms.
07FFL's...."Manufacturer"......gets a Class 2 SOT....it allows dealing and manufacturing of NFA firearms.

An 01FFL cannot get a Class 2 SOT.
When did I ever claim that an 01 FFL could get a Class 2 SOT? Nothing I posted was even remotely incorrect.

Having a Class 2 SOT requires a manufacturing FFL, such as an 07 that allows you to be both a manufacturer and dealer. Both dealers I've worked at had an 07 FFL and a Class 2 SOT.

Are you specifically referring to my use of the word "dealer"? I was using that word in a general sense, I wasn't specifically referring to 01 FFLs. But even then, you can be both a manufacturer and a dealer at the same time. Lots of dealers have manufacturing FFLs even though they don't do much in the way of manufacturing. It's not incorrect to refer to those types of dealers as "dealers".

The store I work at deals in guns and NFA items, so many people would call us a dealer. We also have a Class 2 SOT. So tell me again how anything I wrote in post #43 is incorrect?
 
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dogtown tom

New member
Theohazard .....The store I work at deals in guns and NFA items, so many people would call us a dealer. We also have a Class 2 SOT. So tell me again how anything I wrote in post #43 is incorrect?
When you wrote: "....A Class 2 SOT is even better than a Class 3 because it allows the dealer to both manufacture and sell Title II firearms.."
That implies that a "Dealer" has the option of a Class 2 SOT or a Class 3 SOT.......they don't.

It is quite common on this forum and others for neophyte and aspiring dealers to want to now what they can and cannot do as a Federal Firearms Licensee.
Imprecise language muddies the water. Your post did that.
 

Theohazard

New member
dogtown tom said:
When you wrote: "....A Class 2 SOT is even better than a Class 3 because it allows the dealer to both manufacture and sell Title II firearms.."
That implies that a "Dealer" has the option of a Class 2 SOT or a Class 3 SOT.......they don't.

It is quite common on this forum and others for neophyte and aspiring dealers to want to now what they can and cannot do as a Federal Firearms Licensee.
Imprecise language muddies the water. Your post did that.
I didn't write my post specifically for aspiring dealers, I wrote my post for the average gun owner who visits these forums. Should I be expected to delve into every single detail of every single gun law in every post?

I used the term "dealer" as most people here use it; it's the place we go to buy guns. And a dealer can -- and often does -- have a manufacturing FFL.

My post was simplistic, and that was intentional. If you feel the need to elaborate when someone posts about stuff like this, then feel free. But don't come on here and "correct" someone who hasn't posted any incorrect information.
 
But don't come on here and "correct" someone who hasn't posted any incorrect information.
The line between inaccurate and incorrect can be tricky. When it comes to legal issues, it can be dangerous.

Consider the nature of this subforum, and of this particular thread. There's every possibility that posts here could be taken by a third party as valid advice or guidance. As such, it does fall to us to be somewhat exacting and absolutely correct.
 

dogtown tom

New member
Theohazard .....I didn't write my post specifically for aspiring dealers, I wrote my post for the average gun owner who visits these forums.
The "average gun owner" doesn't give a rats hiney whether his dealer has a Class 2 or Class 3 SOT.




Should I be expected to delve into every single detail of every single gun law in every post?
When you "elaborate" on someone else's post you shouldn't muddy the water.;)



I used the term "dealer" as most people here use it; it's the place we go to buy guns. And a dealer can -- and often does -- have a manufacturing FFL.
Often? 01/02's outnumber 07's by almost 7:1
 

Theohazard

New member
dogtown said:
The "average gun owner" doesn't give a rats hiney whether his dealer has a Class 2 or Class 3 SOT.
The intent of my post was simply to explain where the often-misused term "Class 3" came from. You often hear people say things like "he has a Class 3".

dogtown tom said:
When you "elaborate" on someone else's post you shouldn't muddy the water.
I really don't see how I "muddied the water". To me, going on and on about the difference between manufacturer/dealer FFLs and dealer-only FFLs and how they relate to the different SOTs would have muddied the water more. I simply wanted to point out that the term "Class 3" is often misused and many dealers are actually Class 2 SOTs. (And yes, those dealers need a manufacturing FFL to get a Class 2 SOT.)

dogtown tom said:
Often? 01/02's outnumber 07's by almost 7:1
Seriously? You just always need to be right, don't you? Yes, "often", as in "happening frequently". Did I say they were a majority or even a plurality? No, I didn't.

Dogtown Tom, I -- and many other people here -- value your expertise and knowledge regarding issues like this one. Feel free to clarify and expound if you think I over-simplified something, but your rude and condescending way of correcting people gets old after a while.
 

Nlight1

New member
When you wrote: "....A Class 2 SOT is even better than a Class 3 because it allows the dealer to both manufacture and sell Title II firearms.."

That implies that a "Dealer" has the option of a Class 2 SOT or a Class 3 SOT.......they don't.


I understood it the same way.

Thanks for clearing that up.
 

Theohazard

New member
Nlight1 said:
dogtown tom said:
When you wrote: "....A Class 2 SOT is even better than a Class 3 because it allows the dealer to both manufacture and sell Title II firearms.."

That implies that a "Dealer" has the option of a Class 2 SOT or a Class 3 SOT.......they don't.

I understood it the same way.

Thanks for clearing that up.
Actually, a dealer (as in "a shop that deals in firearms") does have the option of a Class 2 SOT or a Class 3 SOT: They can set up a dealer-only FFL and get a Class 3 SOT, or they can set up a dealer/manufacturer FFL and get a Class 2 SOT. And next time I'll be sure to get into those details and avoid all this.
 

James K

Member In Memoriam
Here is a summary, but please understand that it does not and cannot cover every nook and cranny of the federal firearms laws.

Federal Firearms Licenses (FFL’s) are licenses issued by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (part of the DOJ). With some exceptions, an FFL is required in order to manufacture, import or deal in firearms in the U.S. There are 9 kinds of FFL, generally referred to as “Types”, and three kinds of Special Occupational Tax to allow the holder of an FFL to import, deal in or manufacture Title II firearms (see below). A license to import or manufacture firearms includes the authority to deal in that type of firearms; that allows importers and manufacturers to deal directly with the public where otherwise permitted.

There are two basic kinds of firearms, differentiated by the Titles (sections) of the Gun Control Act which covers them. Ordinary rifles, shotguns and handguns are covered under Title I, and commonly called “Title I firearms”. Other firearms, such as machineguns, short barreled rifles and short barreled shotguns are covered under Title II and commonly called Title II firearms or “National Firearms Act” (NFA) firearms from the older name of the law. That category includes some items legally designated as “firearms” for the purpose of the law; those items include silencers (suppressors), some types of disguised firearms, and devices intended to change the nature of a firearm, such as a converter to make a machinegun from a semi-automatic rifle.

The Special Occupational Tax (SOT) is a category of tax required for importing, dealing in, or manufacturing, firearms that are controlled under Title II of the Gun Control Act. The three kinds of SOT are referred to using the term “Class”. That the SOT has been paid is indicated by a tax stamp (a literal paper stamp) which is attached to the FFL, so an SOT can only be paid by someone who already has an appropriate FFL. Here are the lists:

Federal Firearms License:

Type 1 – Dealer in Title I firearms.
Type 2 – Dealer in Title I firearms doing business as a pawnbroker.
Type 3 – Licensed collector of Curios and Relics (but not a dealer).
Type 6 – Licensed maker of ammunition and reloading components other than Armor Piercing ammunition.
Type 7 – Manufacturer of Title I firearms, ammunition and ammunition components, but not Title II firearms, Destructive Devices, or Armor Piercing ammunition.
Type 8 – Importer Title I firearms and ammunition.
Type 9 – Dealer in Title I firearms, including Destructive Devices but no other Title II items.
Type 10 – Manufacturer of Title I firearms, ammunition and ammunition components, including Destructive Devices, but no other Title II items and not Armor Piercing Ammunition.
Type 11 – Importer of Title I firearms, ammunition and Destructive Devices, but no other Title II items.

Special Occupational Tax:

Class 1 SOT - Importer of Title II (NFA) firearms.
Class 2 SOT – Manufacturer of Title II firearms.
Class 3 SOT – Dealer in Title II firearms.

To obtain a Class 1 SOT stamp, the applicant must have a Type 8 or 11 FFL.
To obtain a Class 2 SOT stamp, the applicant must have a Type 7 or 10 FFL.
To obtain a Class 3 SOT stamp, the applicant must have a Type 1, 2, 7, 8, 9, 10, or 11 FFL.

Jim
 
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