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Wiskey_33
April 17, 2009, 09:02 AM
So I've got a question regarding the selling of a firearm for profit.

If a firearms was purchased for the sole purpose of reselling it for a profit, does this break any laws under the ATF?

Lets say I found a great deal on a new firearm that is hard to get. I find it and pay, say $400. I then turn around, having never fired the firearms, and sell it for $700. All of this, fully knowing I never planned on using it myself.

I know what the ATF says about it, but it says "as a business." This is an unlicensed citizen selling to another citizen.

Any help is much appreciated.

Thanks.

Chipperman
April 17, 2009, 10:06 AM
Doing this once is not going to raise any eyebrows. Doing it repeatedly, however, would mean that you are a dealer in practical terms.

There have been stories of ATF agents going to gunshows in the past and offering people more money for a gun they had just bought. The agents then turned around and busted them for being a dealer without a license. I do not know if these stories are true.

44 AMP
April 17, 2009, 12:02 PM
like being a manufacturer, it depends on someone's interpretation of what constitutes "engaging in the business".

That interpretation is, ultimately, the agent making the arrest, and later, the judge hearing the case.

Stories of agents "entrapping" people at gun shows are rife, especially during the Clinton years. However, we hear no stories of convictions, based on this. I have no proof, one way or the other, but there have been confirmed cases of the ATF causing people hardship before having charges dropped or thrown out, or getting them to plead to lesser charges in order to end their ordeal.

We are still allowed to sell our private property for a profit, (although technically, you might be responsible to declare your profit as "income"), but if you are not making a business of it, in the eyes of the law, you are not doing anything wrong. A single sale, or a sale of multiple guns, one time does not (generally) meet the legal definition of engaging in business.

Now, if you bought an old gun at a yard sale for $40, and later found it to be a valuable collector's piece, selling it for $28,800, the IRS might be interested.

Firing the gun has nothing to do with owning it. Even buying a gun with the obvious intent of reselling it at a later date is not important. What is important to the law is the intent of engaging in business. If they can prove that, they can get a conviction. Even though the anti gunners call anyone who sells even a single gun a dealer, the law isn't at that point...yet.

comn-cents
April 17, 2009, 12:13 PM
I don't think doing it once is wrong, but is it worth possibly losing your right to own guns if the ATF thinks it's wrong? I say no way.

Wiskey_33
April 17, 2009, 12:19 PM
Thanks for the answers guys. Seems like it could go either way.

brickeyee
April 17, 2009, 01:31 PM
Buying and selling repeatedly with the intent to make money can attaract attention.

It is at the heart of "engaging in the business."

44 AMP
April 17, 2009, 01:54 PM
You buy a gun. You then own it. You don't have to shoot it, makes no difference, you own it. The amount of time you own the gun doesn't matter. You sell that gun to someone else. The amount of money doesn't matter. You do this once. You are not engaging in business.

Now, if you do this 5 times a year, are you in business? You might be. If you do it every week, you almost certainly would be. But doing it once, or even once in a while, you are not in "business".

Hope this helps

Wiskey_33
April 17, 2009, 02:29 PM
Thanks for the replies. I figured if one were to buy something, then go out into the parking lot and sell it, the original buyer never intended on buying the item for them self, and would be lying when they initial line 11 A on the 4473.

NavyLT
April 17, 2009, 02:53 PM
Thanks for the replies. I figured if one were to buy something, then go out into the parking lot and sell it, the original buyer never intended on buying the item for them self, and would be lying when they initial line 11 A on the 4473.

It might APPEAR that way. You buy a gun from a dealer on a 4473 and then sell it an hour later - sure LOOKS like a straw purchase. Even though it really isn't, unless you knew exactly who you were going to sell it to and had made those arrangements before you purchased the gun. And, before it is even mentioned here - the legality of the final recipient of the gun to possess or purchase that gun themselves has no bearing on straw purchase.

But, if you purchase the gun knowing that it is a good price and just have a hope you can sell it for a profit, that is not a straw purchase, even if you sell it an hour later.

scorpion_tyr
April 17, 2009, 05:05 PM
All of this, fully knowing I never planned on using it myself.


That's the statement that would get you in trouble.

Something more like "I bought it, and then just changed my mind" is more like it. And this will probably only work a few times.

Tom Servo
April 17, 2009, 09:08 PM
The 4473 mentions it as "repetitive sale of firearms for profit." It would have to be a significant and regular source of income.

Where the line is drawn, I don't know.

That said, I knew a guy who had friends over four states who didn't live near good gun dealers, so he'd find nice guns, buy them, then sell them over to his friends. He was a really nice guy, and I believe he just collected enough "profit" to cover his fuel costs and lunch.

He could have been busted, but good luck finding a jury in the South willing to lock him up for it.

OTOH, I am seeing and hearing ALOT of folks who are buying up tons of cheap guns to use as "currency" when the balloon goes up/society collapses/the black helicopters come. Those guys are risking it, and they've advertising the fact.

NavyLT
April 18, 2009, 11:32 AM
That said, I knew a guy who had friends over four states who didn't live near good gun dealers, so he'd find nice guns, buy them, then sell them over to his friends. He was a really nice guy, and I believe he just collected enough "profit" to cover his fuel costs and lunch.

He could have been busted, but good luck finding a jury in the South willing to lock him up for it.

I doubt that there would be a jury that WOULDN'T lock him up since each sale to an out of state "friend" was committing two separate felonies - one on the part of the seller and one on the part of the buyer.

Kmar40
April 18, 2009, 11:45 AM
Now, if you bought an old gun at a yard sale for $40, and later found it to be a valuable collector's piece, selling it for $28,800, the IRS might be interested.Actually, any profit on any personal property would be a short-term capital gain. There is little likelihood that the IRS would know about your average gun sale, however.

apr1775
April 19, 2009, 08:22 AM
Federal law clearly states that a non ffl holder may add to or liquidate a personal collection. Lets suppose a year ago I bought an ar15; now there is an increased demand for such a rifle and the market value has increased to reflect that demand. Now I can sell that rifle for a price that will allow to buy that double barrel shotgun I've always wanted. Was I engaging in business for profit, or was I just making changes to my personal collection?

Some of those private sellers with tables at the gunshows likely make no "profit" once they figure in all their expences. They may be doing the shows as a hobby or a social thing.