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johnwilliamson062
May 31, 2009, 09:06 PM
I am considering opening a transfer service out of my office. I think I have a pretty good grasp on what the FFL side of it is, but I have some questions I thought some of you might be able to help me with.
1.What does the insurance run(this would be my only overhead besides a safe.
2.Are there any unseen pitfalls? Am I going to be audited by ATF all the time? I imagine getting an ATF audit is no more fun than an IRS audit and would like to avoid both if possible. Are there big differences between personal and business FFLs or anything?

My plan is to keep it to one or two rifles in the office at a time to limit my exposure to theft. We already have a decent security system and are within sight of the PD.
The insurance and FFL would be my only real overhead as far as I can tell since I can piggyback everything elso off of my other business.

johnwilliamson062
June 1, 2009, 02:02 PM
No one doing this want to give me some hints? I know some of you have got to be running small time transfer services.

Brian Pfleuger
June 1, 2009, 02:21 PM
I can give you second hand info.... I have some friends who are small FFLs.

All I hear from them is about the paperwork. You must have records of everything, E-V-E-R-Y-T-H-I-N-G. No errors on the paperwork. No lost forms, no blank spaces...

Background check OK 1530, Customer passed gas at 1537, Eyes began watering at 1538....;)


The level of "anality" exhibited by the ATF is legendary. Keep records like your an autistic savant and you should be fine, from what I've been told.

Sorry no first hand knowledge.

dogtown tom
June 1, 2009, 07:49 PM
johnwilliamson062 :
1.What does the insurance run(this would be my only overhead besides a safe.

You'll need a general liability policy and a property policy at a minimum. My policy also covers guns on my table at gunshows.

Collectables Insurance is who I use.


2.Are there any unseen pitfalls?
Pitfalls are NEVER seen until afterward.:D

Am I going to be audited by ATF all the time? .
I've had my FFL since last September and have yet to be audited or inspected. I believe ATF does an audit no more than once per year, unless you have had problems in a previous audit.

Are there big differences between personal and business FFLs or anything?
The is no such thing as a "personal FFL". An 01FFL is issued to someone who intends to engage in the business of dealing in firearms.


There are really only three things to obsess over as to recordkeeping:
1. Your Acquisition & Disposition Record- commonly called a boundbook or logbook. This is what you record every incoming & outgoing firearm transaction.
2. Form 4473's "Over the Counter Firearms Transaction Record"- this is the form your customer completes when purchasing a firearm. Results of the NICS check are recorded on this form.
3. Multiple Sale of a Handgun" form- the dealer completes this anytime a customer purchases more than one handgun in a five business day period. A copy is sent to ATF.

Your ATF "audit" will match up 4473's vs. entries in your boundbook vs firearms in inventory. Missings guns, missing or incomplete 4473's, or having guns in your display case or gunsafe that aren't on the books (or tagged as "personal collection") will cause ATF to beat you severly. :eek:

johnwilliamson062
June 1, 2009, 09:53 PM
Well, I know people who have 01 ffls b/c they personally buy enough guns to make it worthwhile(we should all have goals in life). I don't think they really do any business besides transfer for friends and such. Maybe they do and just don't talk about it.

You'll need a general liability policy and a property policy at a minimum. My policy also covers guns on my table at gunshows.
None of my carriers want to ouch firearms sales. They don't even want to write buildings if the tenants is a firearms dealer. Thanks for the lead on collectors insurance.

Once a year would still be pretty time consuming. If I had to go through an IRS audit for my business once a year the time that would take would kill me. How long is the ATF audit process if all goes well?

Ricky B
June 1, 2009, 11:14 PM
What does the insurance run(this would be my only overhead besides a safe.

You might want to consider an alarm system too.

Check your local ordinances. They might require an alarm system or otherwise regulate firearms dealers. Or not.

johnwilliamson062
June 3, 2009, 02:23 PM
already have an alarm system.

Collectors insurance says $92 a half. Very reasonable. Of course, they are not writing the building just the business property.

spacemanspiff
June 3, 2009, 02:32 PM
You may wish to inquire about an umbrella policy as well, if your GL coverage is so cheaply priced, make sure it has $1,000,000 occurrence/$2,000,000 aggregate limits, and then maybe go for a 3 or 5 million umbrella over it.

An insurance policy nowadays will hit its occurrence limit very quickly, and once that aggregate is exhausted, there is no more coverage for that policy period.

jerry4570
June 6, 2009, 06:18 PM
Well, I know people who have 01 ffls b/c they personally buy enough guns to make it worthwhile(we should all have goals in life). I don't think they really do any business besides transfer for friends and such. Maybe they do and just don't talk about it

I asked the original question of my new ffl because I'm considering the same as a gunsmith and transfer, small dealer. he says the atf wants to see intent to do business or they will not issue license.