Firearm manufacture

[Guest GregRN]

I have a question about firearm manufacture that I'm sure someone can answer. After reading the thread about the BATF, I'm unsure.

If I were to build an AR-15 or a 1911 from parts, am I required to keep it forever? Can these ever be sold, or will I be in legal trouble for manufacture? I was under the impression that there is one piece of each firearm (AR lower, 1911 frame) that is numbered, and therefore, the "firearm". Unless I mill, or stamp, the one part, how can I be manufacturing firearms? It would be assembly at that point. Is the sale of assembled parts illegal?

I know we have some on here that make a living doing this very thing. Enlighten me, please.

[saintsfanbrian]

IANAL - The receiver is the firearm. It is a serialized item and requires the NICS check to purchase. After you purchase that and put other parts on it you have "built" a working firearm. If you were to do this en masse I would imagine that you would need a license. If you are talking about taking an AR that you bought built and played with a while and selling it to an individual - you should be okay.

[The Rabbi]

Yes, that's correct.

I was told by ATF that I could not sell both an upper and a lower AR to the same person or else I'd be considered a manufacturer (instead of a dealer). the issue is that every firearm produced has an 11% excise tax. This is why building your own AR is more cost effective--you avoid this tax.

[Guest Jason F.]

The rules restricting you from selling a firearm you made are related to you machining the receiver on your own and not purchasing a completed receiver from a licensed FFL dealer. There are a number of sources for frames/receivers in the from of raw forgings all the way to 80% complete units. These are not serialized firearms until they are 80% complete or more and therefore do not require a FFL transfer. You are required by law to complete the machine work yourself. You can not legally pay someone else to do any of the work for you. These laws allow for an individual such as a gunsmith or hobbyist to build a custom firearm for personal use only. You can see a bit of that here http://www.tngunowners.com/forums/showthread.php?t=4550

As already mentioned above if you are buying a completed lower for an AR or a 1911 frame from a dealer you can complete the firearm from parts and sell it at any point as long as you follow the same laws as you would selling any store bought firearm.

[Guest GregRN]

Thanks for the replies. I understand now, more than ever, that our gun laws are as stupid as the individuals who penned them. How much sense does it make?

Or is it "How much cents does it make?"

[Guest ETS_Inc]

Ah, the lovely, uncomplicated of manufacturing a firearm. LOL, yeah, uncomplicated, right.

Let me preface this by warning you that if you call BATFE 20 times, and speak to 20 different employees, you will get 25 different answers. It doesn't matter what the subject is, that's darn-near SOP.

You can build your own firearm, from scratch, and do not have to assign a serial number to it. Building an AR from scratch is best done using what is known as an 80% reciever. That means that not all of the holes have been drilled out, there is no rollmarking on it, and it hasn't been anodized. You drill the holes and anodize it yourself. Then, you install the lower parts kit and slap on an upper. Viola, you've built a rifle.

The catch is, since no Federal Excise Tax has been paid on it, the rifle doesn't have an assigned serial number, and it's never been recorded with BATFE, you can never sell it. If you wish to sell it, you must pay the 11% FET. Of course, if there are no markings on it, and you were to sell it to someone smart enough to tell people that he built it, who the heck would really know the difference?

Or, you can use a stripped lower reciever that you purchase from an FFL. The stripped lower is technically a firearm, according to BATFE, as it is the serial numbered part of the complete firearm. However, stripped lowers are sold as replacement parts, and since they aren't previously built into complete firearms, the FET has not been paid on the lower. Again, since no FET has been paid on it, you're not really supposed to sell it once you build it. But, again, BATFE isn't going to come busting down your door if you built a lower into a rifle and decided to sell it awhile later. They have bigger fish to fry. Now, if you were buying a bunch of lowers and rifle kits at a time and assembling them before selling them to friends, you're probably just a few guns away from a visit from the ladies and gentlemen from Washington.

If you are an FFL, you can sell a lower and an upper to the same person, at the same time. However, you can't assemble it for them, as that would constitute manufacturing. If they brought a stripped lower, with parts kit, stock, and upper to you that were bought elsewhere, you can assemble it for them, as this is simply gunsmithing. If you sold the stuff to them, they take it home and realize that they are not mechanically inclined, and then bring it back a day or two later, asking you to put it together, you can, as that is gunsmithing. It all boils down to intent. If you intentionally sell them a weapon you assemble prior to the sale, or as condition of the sale, you are manufacturing. If you sell them all the necessary parts, and then assemble it after the sale (without it being a condition of sale), you are doing gunsmith work.

The Federal Excise Tax is one of the biggest reasons it is cheaper to build your own rifle than it is to buy the same rifle already assembled. Think about it this way:

You can buy all the separate components for say $600. Since they are sold as separate components, not a complete gun, there's no FET paid on them.

If you buy the complete rifle, the components would be worth $600, the manufacturers assembly labor would be say $50. That makes the total $650. FET is 11% of the sale value. The manufacturer sets MSRP, and pays the Federal government 11% of that. The remaining amount has to cover the retailer's profit, cost of components, and assembly labor. That's why it costs $800 to buy a rifle you can build yourself for $600. Of that $800, $88 goes to the FET, $650 goes to the manufacturer, and $62 goes to the retailer.