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A Federal Firearms License- What can it do for you?

September 13, 2013

 

by Andrew Mattox

When Obama first won the 2008 Presidential election, many gun owners wondered what might come of the current gun legislation. When Obama was re-elected in 2012, most gun owners became certain that change was sure to happen on the front lines of gun rights. Firearms have been appearing in the media consistently now; whether the discussion is about banning them, having them, or how they’ve been used; and Obama has been trying to move forward restricting gun ownership. Despite efforts to make universal background checks a requirement and ban “assault weapons” have failed, Obama did move forward on an executive order to make background checks required for any trust or corporation purchasing NFA (National Firearms Act) items such as silencers, machine guns, and short barrel rifles. As of yet, nothing is set in stone as far as policy changes, but in due time those changes will take place.

The NRA has been working tirelessly to keep the federal government from overstepping their bounds, and their efforts have yielded amazing success thus far. Despite all that, it may be time to consider- if you can’t beat ‘em, join ‘em. At first, it may seem counterintuitive. Why would you want to get closer to the federal government when they’re only working to restrict the rights of the citizens of this country? There’s a few reasons why.

A federal firearms license (FFL) is the license granted by the federal government which allows individuals, partnerships, or corporations to buy, sell, make, transfer, and/or import (depending on the license) firearms. Obtaining this license essentially puts you in a position of power. You are considered an extension of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) once you become a licensee. There is no national database of firearms (except for National Firearms Act firearms), so when the ATF needs information regarding a particular serial number of a firearm that was used in a crime, they follow the paper trail created by the regulations set in place by the Gun Control Act (GCA). As a dealer, you can help to catch the criminals who do use firearms unlawfully which makes more problems for responsible gun owners. Furthermore, you can learn the signs of straw purchases- where one individual purchases a gun on behalf of someone who would otherwise not pass a background check- to prevent firearms from being passed onto the wrong hands. When the laws that are already in place are utilized to prevent gun crime, it makes it very difficult for the left-wing administration to have a leg to stand on to demand stricter gun control.

There are also personal benefits to becoming a licensed gun dealer. As a FFL dealer, you’ll have access to wholesalers and manufacturers. The margin in firearms sales is about 30 percent, so for any firearms you’re looking for to add to your own collection, you can purchase them at cheaper rates than by going to another dealer. You’ll also be making revenue for every gun you sell at retail price. Just for example, a new Springfield XD retails for around $550. When purchased from a wholesaler, it would cost $385. That is an income, or savings if you’re adding it to your own collection, of $165. It is important to point out that the ATF will not grant a FFL license to someone simply for only adding to their personal collection. You must plan on doing at least some sales or transfers of firearms. It certainly doesn’t mean you have to do gun sales full time, but you cannot get licensed just for personal use.

Another point to note is that there is an application fee that goes along with the FFL license. It costs $150 to apply for your FFL, but that fee covers you for three years. You’ll need to renew your license every three years by paying that $150 fee again. The cost of the license is really not so bad when you consider that you can recoup that cost with the sale of one gun.

The benefits of a federal firearms license make obtaining one truly something to consider. You don’t even have to run out to lease a store front as it is possible to become licensed from your home. There are a number of websites that can help you with the application process and other aspects of holding an FFL including ffl123.com and federalfirearmslicenseffl.com.

Obviously becoming a licensed dealer is not the right decision for everyone. However, if protecting your gun rights is important to you, exploring every avenue is a must.

 

About the Author:

Andrew Maddox is a tactical shooter who enjoys his life while shooting and hunting. He is also a certified firearms license instructor that frequently writes for FFL123.com, a site that helps people obtain their Federal Firearms license in Nebraska, North Dakota, and South Dakota.

10 Responses to A Federal Firearms License- What can it do for you?

  1. George on September 14, 2013 at 9:31 am

    “…The margin in firearms sales is about 30 percent…” In Metro Detroit it’s 12% to 15%. “…a new Springfield XD retails for around $550…” In Metro Detroit, True. “…When purchased from a wholesaler, it would cost $385…” No national wholesaler sells it that cheap, you are way low. Be careful with the numbers, margins in this industry are razor thin.

    • Brandon on September 16, 2013 at 11:11 am

      I saw a dealer selling SIGs this weekend for 25 to 30% market up. He sold me one at his cost…

  2. Rich on September 14, 2013 at 11:01 am

    Having a FFL license from your home then authorizes the ATF to come and inspect your inventory at any time, does it not? If so, one should consider the loss of “search and seizure” constitutional protections when considering an FFL.

    • Brandon on September 16, 2013 at 11:12 am

      They can only search your inventory or records during a compliance inspection. Federal law very clean on this, important to do this right so you define where your inventory is located and where you keep your books.

    • Natalie on September 16, 2013 at 11:14 am

      You still retain your rights against unlawful search and seizure. The ATF can come inspect your inventory, but that maximum they can do that, without a warrant, is once a year. And even though they can do it that often, they rarely do. Also, if you get a home based license, it’s not like they’re going to be going through your medicine cabinet and dresser drawers. There’s really not as much to fear as one might at first think.

    • Bob H. on September 20, 2013 at 10:34 am

      You are absolutely correct. An FFL holder agrees to allow the ATF to inspect your premises any time they wish, unannounced. The oddity in all this is, I once held an FFL during the Clinton years, but I was forced to surrender it because as the letter said I “wasn’t selling enough firearms to justify holding an FFL”. Does anyone else find that strange?

  3. Bruce Gordon on September 14, 2013 at 12:41 pm

    Being an FFL, ALSO benefits you in another respect. If you are relieved of firearm, by ANY LEO, for ANY Reason, He has just committed a Federal Felony, as you weapon is considered part of your Inventory, and would be an UnLawful Transfer. Just report it to the local ATF, and the LEOs career, it Toast, and he should be spending some time in a FEDERAL Gray Bar Hotel. The GCA makes NO Provision for LEO Exemptions, in this matter. By rights the LA Cops that went to the local Gun Store, to get Rifles to take down the AK47 Bank Robbers, should have ALL been prosecuted for Federal Felonies, for their actions. They did NOT comply with Federal, or State of Commiefornia Statutes, when “Borrowing” those weapons.
    There is NO Provision in either of those Statutes for LEO Exemptions…
    Just Say’en….

    • Brandon on September 16, 2013 at 11:13 am

      Great insights Bruce!

  4. Howdy on September 14, 2013 at 9:27 pm

    I would ask the author to list all of the downsides as some have pointed out in this article. The author does everyone a disservice by not disclosing the negative details.

    • Brandon on September 16, 2013 at 11:27 am

      Negatives –
      you need to keep up with where you got the firearm and who you give it to.

      Quick phone call background checks…

      Average ATF compliance inspection is once every 25 years.

      Renew every 3 years, $90 every 3 years.