What are the credentials to be a Class 2 weapons maker?

[Bryant]

I was thinking if full auto's can be owned by class 2 makers then why not become one? You could do it in your spare time but the biggest benefit would be to own cheap full auto's. Do any of you know anything about what is required, I would like most be interested.

[Fargox]

I am working on getting a class 2 SOT right now as we speak. I went to a Machine Gun demo shoot a couple a weekends ago and learned allot. Everyone there was a SOT holder. The only way to go. The costs are $150.00 bucks for a FFL, lasts 3 years, and an additional $500 bucks a year for the SOT. You dont have to pay any additional transfer fee's with a SOT, so say goodbye to those $200 dollar fees that non SOT's have to pay.

Bryant, if you get a SOT (special occupation tax) you could take your SLR95, cut the barrel down, install a functional underfolder and convert it to fullauto. To make all of these addons legal, all you have to do is call the BATF and tell them that you made the gun into a MG withing 24 hours after completing the project. Your SLR would be a Post Demo gun. Transferable only to other SOT holders or LEO.

Pretty cool eh?

You can also import post sample MG's and post ban hi-cap's for research and developement purposes. I know what you are thinking Bryant, FNP90? MP5A3? AKSU74 Krink? Straight from the manufacture or overseas dealers. You can only import one of each and you would need a signiture from a local LEO.

I cant wait, how about you?

Its $200 for the FFL, remember, you can't just make them for yourself, you gotta sell some of them. And you for got the excise taxes you have to pay and the other B.S. related to Manufacturing. I do have an FFL and am currently looking into getting my Class 3 SOT. The manufacture's license is just to muck BS for me.

[Fargox]

$200.00 for the FFL? All of the guys in MN are paying $150.00 for them.

You have to sell some of them? How many do you have to sell to be legit in the minds of BATF?

What excise taxes do you have to pay?

What is the difference between a class 2 SOT and class 3 SOT? Can class 3 SOT make destructive devices? If that is the case, I would imagine that there would be a few more headaches than a class 2 SOT.

Pardon my ignorance, I am still learning about this stuff.

I don't know were they get there $150 FFL's at, I have a set of ATF forms here and they say $200, and all the law books I have from ATF also say the same. They are probably blowing smoke up your ass.
First off, you have to have the proper state and city license to even get the FFL, and if you want to manufacture, you have to worry about zoning, waste disposal, and liability insurance, if you sell a machine gun to some one and it blows up in their face you better have good insurance to back it up, my dad had an ammo manufactures license, a bullet blew up and some one sued him. Put him out of business and cost him a lot of money.
I have had my FFL for 2 years now (yes it did cost $200, 2 years ago) and i would suggest not even messing around with NFA weapons until you know the regular firearms business first. You fuck up with NFA weapons, thats big trouble.
The excise taxes is what the government get when you make a gun for sale, 11-15% I think but i'm not sure, the excise taxes are extremely complex, and I don't know much about them but i do know you have to pay them. More paper work.
I'm not sure how many guns you have to sell to be legit, it's up to ATF, and when you Manufacture, you get yearly inspections as do regular FFL. If you don't meet their criterea, you'll lose you license, and have to get rid of all the samples you made.
The Special Occupation Tax goes as follows
Class-1 Importer of NFA weapon, you have to have this to import machine guns $500/yr
Class-2 Manufacture of NFA weapons- $500/yr

Class-3 Dealer of NFA weapons $500/yr

Destuctive devices is a whole ball game by its self, and its a type of FFL, runs $1000 if i recall.
IMHO i don't think manufacturing is worth the hassle especially if you aren't in the business and know how it works. I recently talked to a big dealer in NFA weapons, and he told me Class 3 was no big deal, but stay away from Class 2 it is not worth the headaches.

Fargo, if you are still thinking about a C2 manufactures license, check this out
http://subguns.biggerhammer.net/mgmsg.cgi?read=36300

[L4Bren]

d&ts,
The $150 FFL isn't blowing smoke up anybody's ass. That is the fee for a type 07 FFL. (Manufacturer of firearms other than destructive devices.) If you have a set of "forms" in front of you, you should see the box for a type 07 license.
Other than that, everything you say is right on the money. However, you forgot annual manufacturing reports, quarterly excise tax returns, annual inspections, and compliance with the Brady Law and Child Handgun Safety Act, as well as every other podunk state, county, and local ordinance, law, ruling, statute, regulations, policies, etc., etc., etc. Add to all that the fact that ATF just might always decide to target *YOU* for a sting operation, or kick in your door because you screwed up some form, and you have a much better picture.
But yes, you do get to make cool machine guns for really cheap.

Tom 07/SOT

[locutus126]

I may just be an idiot but coul'dnt one just get the lisciense, buy post smaples and or make them and never sell any claiming "bad market"

[clay]

It used to be that you just had to show that you were 'trying' to sell product. You had to be reasonable about it, though. No $20,000 MAC's or $30,000 UZI's. Also, receipts from buying table space at gun-shows to display went a long way with the inspectors, as well as copies of your ads from Shotgun News and Machine Gun News (now Small Arms Review). Basically they just wanted to make sure that you made a reasonable amount of effort to sell your goods. You didn't have to make a profit, you just had to show that you didn't just get your license to add weapons to your personal collection.
This was from years back, though. Things may have (and usually do) change.

[Treadhead]

Bryant, my brother and I are in the middle of all that now.

A friend of ours got his about 3 months ago and owns around 10 FA's now.

He takes them to the shoots and is going to use the money earned from his "post samples" ($10/mag) to buy transferables for "keepers".

meanwhile, He still gets to play with the "posts".

I doubt that with the Licenses and cost of everything he has now that he's up to the cost of a Transferable '47.

[royce]

If you read the actual Fed. Regs for an 07 license, you will note several things that make it difficult for the average guy:
1) It clearly states that you must have a business premises, which means meeting local laws pertaining to the firearms business and proper storage & security, etc.
2) As a manufacturer you inherit no rights of a dealer...different license. A manufacturer can only do transferes to & from another licensee.
3) as was stated, the paperwork. Not just for the ATF, but now for the business.
4) Open to an inspection of books and/or premises once in a 12 month period or anytime relating to a bonafide criminal investigation.
5)You inherir no rights or priveleges for your personal use/collection. THe two remain legally separate.

There is nothing written in the Federal Regs pertaining to the status of your business or the number of transactions. Nor is there anything pertaining to your 'efforts' as a manufacturer,since as a manufacurer & not a dealer, you cannot sell to private citizens...only LEO, Government, and other Licensees. Gun shows will not do you much good.

A Dealer, on the other hand, has such priveleges, but also additional scrutiny as to intention, and many more hoops to jump through.

It is usually, in the end, not worth the time & expense just to go rat-tat-tat a few times and then realize you are all dressed up with no where to go. Also, if you are in state/city where it is illegal to have an MG, then you won't even have a place to shoot the damn thing with the addition of few to no Class III dealers to buy-sell-trade with.
If you are in an MG state, you will do better in the long run financially to just get the tax stamp and buy the F/A and be legal & happy.

[This message has been edited by royce (edited 01-20-2001).]