Posted by: John_Pierce
May I consign my NFA items to an FFL/SOT? - 12/02/14 10:52 AM
One of the more common questions I am asked is whether the owner of an NFA item may consign it to an FFL/SOT to facilitate a sale.
The answer, like so many where the NFA is concerned, is both “Yes” and “no.”
Let me explain …
“Yes” a seller may send pictures and details of an NFA item to an FFL/SOT who will then attempt to facilitate a sale. If the resulting buyer lives in the same state as the seller then they may do a private Form 4 transfer between them. If the buyer is in another state then the seller must do a Form 4 transfer to an FFL/SOT in the buyer’s state of residence who will then do a Form 4 transfer to the buyer.
But “no” you may not deliver the NFA item itself into the possession of an FFL/SOT without doing a Form 4 transfer and paying the accompanying transfer tax.
I have heard rumors that some FFL/SOTs will take an NFA item in for ‘repairs’, which does not require a transfer tax, and then show the item to prospective buyers while it is waiting to be ‘repaired’. I would not suggest using such a tactic to skirt the transfer tax requirement since the ATF notoriously lacks a sense of humor where tax evasion is concerned.
I should also note that these same rules apply equally to items owned by individuals or by an NFA Trust.
For more information about NFA transfers, see Chapter 9 of the ATF NFA Handbook.
This article, including links, is from The Law Office of John Pierce, Esq.
The answer, like so many where the NFA is concerned, is both “Yes” and “no.”
Let me explain …
“Yes” a seller may send pictures and details of an NFA item to an FFL/SOT who will then attempt to facilitate a sale. If the resulting buyer lives in the same state as the seller then they may do a private Form 4 transfer between them. If the buyer is in another state then the seller must do a Form 4 transfer to an FFL/SOT in the buyer’s state of residence who will then do a Form 4 transfer to the buyer.
But “no” you may not deliver the NFA item itself into the possession of an FFL/SOT without doing a Form 4 transfer and paying the accompanying transfer tax.
I have heard rumors that some FFL/SOTs will take an NFA item in for ‘repairs’, which does not require a transfer tax, and then show the item to prospective buyers while it is waiting to be ‘repaired’. I would not suggest using such a tactic to skirt the transfer tax requirement since the ATF notoriously lacks a sense of humor where tax evasion is concerned.
I should also note that these same rules apply equally to items owned by individuals or by an NFA Trust.
For more information about NFA transfers, see Chapter 9 of the ATF NFA Handbook.
This article, including links, is from The Law Office of John Pierce, Esq.