Part 4 – Getting a Home-Based FFL – Application Submitted!

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With all of the due diligence on zoning and local regulations now addressed, I was finally able to turn my attention to completing the actual FFL application. To be open, my application was sent in about two weeks ago, but I have now only had enough time to get this all on written up.

Before I get started on the application, I would like to start on something that I believe you should not do.

LegalZoom Registered Agent Service

LegalZoom was an excellent and easy resource to create my LLC but they did have one big “gotcha” that I would hazard to label malicious. Buried in their LLC creating process is the Registered Agent Service. (See Wikipedia for a definition and role of a Registered Agent). Their service is $159/year, which is high compared to like services. LegalZoom’s service is automatically billed yearly, upfront.

My suggestion would be to use another service or be your own. It may mean a bit more junk mail, but for $160/year, its worth it. In Indiana, I can fax in a Registered Agent change for no charge and am working on a refund from LegalZoom.

ATF Form 7 Application

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To apply for an FFL, an applicant must complete ATF Form 5310.12 (Form 7) “Application for Federal Firearms License.” Deceivingly short (only 4 pages), the Form 7 covers a significant amount of information. It requires general applicant information (name, name of business, etc.) but goes into detail on items such as operating hours (note* the only times the ATF can stop by without an appointment for an inspection), military service number (if you served), citizenship, landlord contact information, etc. It can be a daunting form if you do not know how to fill it out.

There are a few questions that have potentially vague responses. I found the FFL123.com guides valuable. Brandon does an excellent job breaking down the appropriate responses, formatting, etc. Without it, I would have likely formatted a few items wrong triggering a rejection and require re-submission of the application to the ATF.

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FFL123.com was valuable as a guide on how to fill out the FFL Form 7. There are a few questions where the needed response was nebulous.

Recently, the ATF has uploaded a fully editable PDF copy of the Form 7. Using Adobe or Fox-IT PDF readers, you will only have to fill out Copy 1 and all entered information is automatically transferred to Copies 2-4. Everything worked perfectly, except for the “Sex” column for responsible persons, which did not have room for “N/A”.

 

Fingerprints

The ATF requires at least one complete, no smudged, copy of FBI FD-258 fingerprints cards, properly formatted included with the Form 7. The ATF will accept electronically printed cards for jurisdictions that have electronic scanners. Annoyingly, Fort Wayne and Allen County do not have electronic fingerprint machines online yet (but they have ordered it). So, we did it the old-fashioned way with pungent black ink and a (very pretty) young lady man-handling my fingers.

Sample FBI fingerprint card.

Sample FBI fingerprint card.

Since the ATF has been known to reject submissions with blurry or smudged cards, I had four sets created and submitted all of them with my application. I know it may be overkill, but for only $5 a card it was worth the money for piece-of-mind. Total cost: $20

Declaration of Citizenship

As a final formality, the ATF requires a testament of citizenship. For native-born US Citizens, this is relatively easy. For naturalized citizens, there are a few other sign-offs required.

To see the current form, click here.

Pictures

The FFL application requires at least a single 2″ x 2″ passport-style photograph of all the “responsible persons” that are included on the Form 7 application. Brandon from FFL123.com indicates that this can be taken on a personal camera and printed, but I chose to have the pictures take at my local drug store. Since I had two CLEOs in my jurisdiction (City Chief & Sheriff), I needed 3 photos. I opted to have four taken just to include an extra with the ATF copy. Total cost: $35.00

CLEO Copies

As part of the application, the ATF requires that a copy (with pictures, but no fingerprints) is required to be sent as a “FYI” only. Local CLEOs may not deny the application but they can contact the ATF to provide feedback (arrest records, etc.) on the applicant that may be used to deny the application.

The county Sheriff was a pleasure to work with but my city Chief’s office was a different story. I received a call from a confused and audibly pissed secretary asking why I submitted the application to the Chief. I was between meetings and attempted to explain, but received a huff and puff, and a hung-up phone. I called back later that day and left a message. It has not been returned.

Fees

Type 01 (Dealers) FFLs are a $200 fee for their application, but interestingly, FFL 07 (Manufacturers) are only charged $150. With the change in local zoning laws, I was eligible for an FFL 07.

While the ATF has not modernized with electronic fingerprint submission, applicants can pay for their FFL with a credit card. I opted for this route since I did not want to have to deal with cancelling a Money Order.

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Note, the ATF will only charge you the application fee if your application is approved. Denied applications will have the payment method returned, or in the case of credit cards, will not charge the card. Total application fees: $150

Expected Turn Around

Law requires the ATF to render a decision within 60 days of submission of a correctly completed application. USPS tracking indicated that the application arrived on 3/4, so I should have a decision by 5/4. If all goes smoothly, this will be just in time to submit the application and fees for a SOT stamp for the new period starting July 1st.

Next in the Series

Until my interview, we will have some down-time until the next installment. I will post up some Q&A from the comments and questions e-mailed to me. A few were excellent that I am sure will have value for anyone looking to apply.

Current Running Total for FFL & SOT ($860.53):

  • $54.99- FFL123.com Guides
  • $381.67 – Creation of my LLC via LegalZoom. Includes state filing fees.
  • $26.12 – Indiana sales tax registration
  • $20.00 – Fingerprinting through local Sheriff
  • $35.00 – 2″ x 2″ Photographs at Local Drug Store
  • $33.75 – Postage for FFL Applications (ATF, City CLEO, & County CLEO)
  • $159.00 – LegalZoom Registered Agent Service (Currently being Cancelled)
  • $150.00 – FFL Type 07 Application Fee

Nathan S.

TFB’s newest resident Jarhead, Nathan is currently working in the Defense industry in international sales. A consecutive Marine rifle and pistol expert, he enjoys local 3-gun, bull-pups, and high-speed gear. Nathan has traveled to over 30 countries in the last three years working with US DoD & foreign MoDs. You will likely find him either in an international airport or on the local range in NE Indiana.

Nathan can be reached at [email protected]


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  • RockDTMC

    Since you opted for a type 07 FFL, you’re OK with paying the required $2250 per year to register with ITAR?

    • http://www.thefirearmblog.com/ Nathan S ” Staff Writer, TFB”

      **Disclaimer- My situation and legal circumstances may be different than yours. Contact a lawyer for a final opinion**

      I have discussed this with various Subject Matter Experts.

      As I read it the regulation, you must only register if you manufacture a firearm. As an 07, I have the ability to but do not have to manufacture a firearm.

      My intent is to use the 07 for R&D (I am working on a bull-pup design in SolidWorks) and thus do not have to register under Sec. 122.1 (b) exemption.

      Sec. 122.1 Registration requirements.

      (a) General. Any person who engages in the United States in the business
      of either manufacturing or exporting defense articles or furnishing
      defense services is required to register with the Office of Munitions
      Control. Manufacturers who do not engage in exporting must nevertheless
      register.

      (b) Exemptions. Registration is not required for: …

      (2) Persons whose pertinent business activity is confined to the
      production of unclassified technical data only. …

      (4) Persons who engage only in the fabrication of articles for
      experimental or scientific purposes, including research and development.

      (c) Purpose. Registration is primarily a means to provide the U.S.
      Government with necessary information on who is involved in certain
      manufacturing and exporting activities. Registration does not confer any
      export rights or privileges. It is generally a precondition to the
      issuance of any license or other approval under this subchapter.

      At the point in time that I create a firearm that will not be used for just R&D I will have to register for ITAR. At that point, I will pay registration fee in anticipation of larger revenues.

      During my non-registration phase, I will have to keep detailed records of the creation, use, and disposition of any prototypes, etc. Obviously, any lapse in this will open me up to significant fines, etc.

      So, what does this ultimately mean for me?
      1. I cannot built on lowers and resell them (ATF classifies this as “manufacturing” (I.E. NO custom guns for friends or online customers unless they provide the parts).
      2. I cannot build a demonstration (even if its not to be sold) firearm without paying ITAR registration
      3. I can ONLY create “firearms” (or other regulated parts) IF they are used ONLY for R&D.

  • Publius

    This series is of great interest to me, as my brother-in-law (a police officer) and I recently started talking about setting up our own FFL on the side. Very informative and please keep up the updates!

  • rdcress

    I went through a similar process a couple years ago in a small city in NC (population 59K). ATF and State were no problem, CLEO didn’t even need to meet even after frantic urging of a Zoning officer for extreme scrutiny. CLEO told her he had no problem with licensed FFLs. Zoning was another issue all together. They wanted the FFL issued before reviewing for a zoning compliance permit. After some arguing that the zoning compliance permit must be issued prior to processing of the FFL they agreed. The zoning officer was very indignant and resistant but I held her to the city ordinances and demonstrated compliance with every one of them in writing. She finally issued one contingent on my getting a city issued business license. That was fairly simple after the clerk figured out which license to issue.

    After getting the city zoning permit and the business license it was to the Secretary of State website to register an LLC and obtain a tax number – all required by the AFT in order to issue the FFL. None of which is indicated on the application but is verbally requested. The LLC and tax number is an easy process on the web with no need to a lawyer or other entities looking to take your money for filling out a simple form.

    Got the FFL and then off to the wholesalers and distributors who mainly don’t want to even talk to non-stocking dealers. I was able to get an account opened with Davidson’s by purchasing a minimum of 5 firearms. Next was Southern Ohio Gun, RLS Group, Midwest Gun Exchange, and a couple others. Ron Shirk will sell to non-stocking dealers. A few others will as well. Never even got a response from a couple distributors.

    The long and short of it is this. If you only sell a few firearms a year you won’t make any money. After the shipping, state sales taxes, and the wholesale price, don’t expect to sell firearms for less than Bud’s guns, or Walmart, and even many stores. Most sales, the state makes more than I do. If you’re planning on buying for yourself, you’re still liable for the sales tax. The state doesn’t accept you buying at wholesale and simply transferring the firearm to your own collection even though the ATF does.

    • http://www.thefirearmblog.com/ Nathan S ” Staff Writer, TFB”

      A good post (which will go up in the Q&A) later.

      I am very fortunate that my Zoning Officers were quite happy to assist and had no issues with a home-based FFL.

      I included my EIN, LLC certificate, State Tax ID, and everything else in my application packet. Tried to dot every “i” and cross the “t’s”.

      Will blog about the distributors later. My hope is to put up a full list of who will and will not sell to non-stocking dealers and order minimums, etc. That’s a few months from now, though!

  • claymore

    You should seriously think about removing your visible whole SS number and real DOB from the photo of the fingerprint card like right now.

    • anilm2

      Card is sample.

    • pedant

      You think 123-45-6789 is a real SS#?

  • nova3930

    Having gotten a confused call from my local law enforcement when I submitted a change of address for my Type 03 FFL, I now include a cover letter explaining in detail what I’ve sent them, why and what they need to do with it. Haven’t gotten a call since I started doing that with 3 address changes under my belt.

  • http://www.thefirearmblog.com/ Nathan S ” Staff Writer, TFB”

    Update: The ATF has charged my credit card for the FFL. Good sign (I hope!)