A Federal Firearms License, also known as an FFL, is a license granted to buy and sell firearms for a profit. An individual who has obtained a federal firearms license has the ability to order firearms from wholesale distributors, as well as receive firearms through the mail. This allows the purchase of a wide variety of firearms, at, often a heavily discounted price.
The application process for an FFL is often cited as being a difficult bureaucratic nightmare, but in reality the application process is not extremely difficult, but often the hardest part is complying with local ordinances, state laws, and zoning regulations, which must be done to obtain a FFL.
An FFL is a license to sell firearms, however state and local regulations may require additional licenses to own and run a business. Although it is a federal license, you cannot do business regarding firearms that has been ruled illegal in your state, or locality.
First Steps
The first thing you should do is make sure you are eligible to receive a Federal Firearms License. There are numerous eligibility requirements for a person, or persons to receive a Federal Firearms License.
- You have to be at least 21 years old to apply.
- You are a resident of the state you plan to do business in.
- You have never broken any federal firearms laws.
- You have not been convicted of a crime that resulted in a prison sentence longer than one year.
- You have never renounced your United States Citizenship.
- You are a legal citizen of the United States.
- You do not, or have never had a restraining order filed against you for harassing a spouse, significant other, or a child.
- You cannot illegally use controlled substances, and legal use must be prescribed and you cannot be addicted to any controlled substance.
- You have never been committed to a mental institution.
- You have never received a dishonorable discharge from the military.
Next check with your local zoning board, tax collector, and possibly the department of licensing for your state and ensure you are meeting all state and local laws. Also if you are planning to operate out of your own home and you are renting, it would be prudent to check your lease and ensure you can operate a business from your home.
If you meet these requirements you have completed the first step. You are eligible for an FFL and can begin the application process.
Choosing a License
There are multiple different FFL licenses, and each has an associated fee. You can have multiple Federal Firearms Licenses. There are 9 different licenses. On your application you will have to select at least one FFL.
- Type 1/2. Your basic FFL, and the most common. This license allows you to sell firearms for a profit, as well as receive them by mail. For NFA weapons you will need to apply and pay for a class 3 Special Occupational Tax.
- Type 6. This license allows you to manufacture ammunition for firearms to sell, and does not affect people reloading their own ammo. This does not allow you to manufacture destructive device ammunition or armor piercing ammo.
- Type 7. Manufacturer of firearms, other than destructive devices.
- Type 8. Firearms importer. Capable of importing firearms other than destructive devices.
- Type 9 Dealer in Destructive Devices
- Type 10. Manufacturer of Destructive Devices, ammunition for destructive devices, and armor piercing ammunition.
- Type 11 Importer for destructive devices, ammunition for destructive devices, and armor piercing ammunition.
There is a separate FFL, a type 3. Which is cheaper and easier to obtain. This type 3 FFL does not allow you to sell firearms for profit. The type 3 FFL allows you to receive curio and relic firearms. Essentially 50 year old firearms in their original configuration for collecting purposes can be purchased and sent to your home through the mail.
There’s an app for that.
The application, known as the form 7 or ATF F 5310.12. You can locate an application on the ATF.gov website or from a local ATF office. The form is quite long, and detailed, but most of the information is common knowledge, including name, phone numbers, business name, mailing addresses, etc. You will also select which type of FFL you’d like to obtain. FFL type 3 is not listed, and requires a different application.
You’ll answer a variety of different questions ranging from how you will pay the associated fee, to your hours of operation, and a question regarding military service. You’ll also have to provide the property owner’s name and contact information if renting or leasing the property that will act as your storefront.
Question 18A requires a careful examination.
Do you intend to sell firearms only at gun shows?
- Yes (If yes, do not submit application.) or No
The question is written very poorly. You can legally sell your personal collection at a gun show, or to others without a Federal Firearms License. However if your intention is to make a profit, and selling firearms as your main source of income, and you do not have a FFL, you are an illegal dealer. You are also an illegal dealer if you are buying guns with the intention to resell them. The question is worded in a way that makes it sound like you could sell firearms at a gunshow as a dealer without a FFL.
Long story short: if you want to sell firearms for profit and as a source of income you will need a Federal Firearms License, even if you only plan to sell firearms at a gun show.
Question number 23 regards being a Non Immigrant Alien, and is divided into sections A, B, and C. Question C sounds very odd,
Are you in possession of a valid hunting license or permit lawfully issued in the United States?
- If you answered “NO,” you likely cannot lawfully possess a firearm and therefore cannot be a Federal firearms licensee.
- If you answered “YES,” complete the following information, and attach a copy of the license or permit to the application.
This is in regards to non-immigrant aliens, however it is still somewhat odd, and not all encompassing.
You will find 4 copies of the Application. Copies 1 and 2 are for the ATF, copy 3 is for the Chief Law Enforcement Officer in your area, and copy 4 is for you. Each copy should be identical in terms of the information you provide.
Photos, Prints, and Payment.
At the end of your application you will come across a little square saying attach photographs here. You’ll need to attach a passport sized photo of yourself, and a copy of your fingerprints. You’ll need a standard FBI FD-258 fingerprint form.
The photo needs to be clear, and you cannot be wearing anything on your head and/or face. If you are having multiple personnel on your FFL you need to include pictures and a fingerprint cards for those people as well. The fingerprints need to be done by a local law enforcement agency to insure they are done properly.
You also need to send the appropriate fee with the application. In your application you can provide your credit and debit card information and the ATF can charge your credit or debit card. You can also send in a check or money order. The ATF does not accept cash.
Once the application is complete, the fingerprints and photos attached, and the payment included, you can mail off your package. You will send the packet to:
The Bureau of Alcohol, Tobacco, Firearms, & Explosives,
P.O. Box 409567,
Atlanta, GA ,
30384-9567 USA
The CLEO
The Chief Law Enforcement Officer in your area is most likely to be either a Police Chief or Sheriff. You will submit copy 3 to your local CLEO. The CLEO does not disapprove or approve your Federal Firearms License, but you must submit the 3rd copy to your area’s CLEO.
The Interview
Once all the forms are submitted, the application is reviewed and the ATF has 60 days to disapprove an application. Once your application is approved you will be interviewed by an Industry Operations Investigator, which is an Agent of the ATF. Many people fret over this interview and worry over it.
This interview is not an interrogation. This interview insures you understand the laws, rules, record keeping requirements, and regulations for being an FFL. The interviewer is not attempting to find unlawful activity. These inspectors may have badges, but they are not law enforcement.
Inspections
There is a likelihood that your business will be inspected by an ATF agent prior to your applications approval, and the ATF can do an inspection periodically throughout the time you hold an FFL. This inspection is to verify your business meets the ATF’s standards. This includes your record keeping abilities. The ATF can inspect your Form 4473s, original BATF forms 5300.35, and retained copies of your BATF form 3310.4. NFA dealers may have to produce Forms 2, 3, 5, 6 and 10, for firearms and devices still in inventory. Inspectors can also inspect your business premise, and firearm inventory.
The ATF can only inspect during your posted working hours. The inspection does not require an appointment, and can be completely random. Most inspectors will schedule the inspection in advance to show professionalism.
Home Based Versus Retail
There are a variety of different ways to operate with an FFL. Typically it’s broken down into two main categories. Home based and retail storefront. There has been a rumor floating around for over a decade regarding the ATF/Government cracking down on home based FFLs.
This started during the Clinton administration. At the time this crackdown is what forced home based FFLs to begin following state and local zoning laws. That is the only supposed crackdown on home based FFLs.
There is a lot of bad information out there stating that the ATF will not give you an FFL if you operate a home based FFL, and this is entirely untrue. The latest statistics I could gather show that 69% of FFLs are home based. This statistic does include type 3 Curio and Relic licenses.
The advantages for a home based FFL is the fact the business can be ran as a hobby, or side business. The overall operating expenses will be much lower since you do not have a storefront to operate out of. The disadvantages are strangers in your home, and lack of a retail location may make gathering customers difficult. The ATF will be granted access to your home for inspections.
If you decide to do an online only business, your home can still be inspected. As an online only business you will see profit margins come from both sales and charging for online transfers. The downside is the increased cost of postage and packing materials.
A storefront will give you instant access to customers, and a store is more than likely going to have more room for inventory. A storefront location is more professional and often easier for new customers to locate. Storefronts are the only location an ATF agent can inspect; as long as that is the only location you do business. The disadvantages are of course cost of renting or buying a storefront, as well as separate insurance policies, security systems, etc.
Conclusion
An FFL application does not have to be difficult, so long as you make sure that you have done your homework and made sure that you meet the requirements and fill out the right forms.
There is nothing stopping you from applying right now!
