Building a Full Auto AR... laws?

[Chris Phelps]

I keep reading posts in reference to building full auto ARs and legal issues, but none ever go into depth enough to answer any questions one might have.

I read that if you have a license to manufacture firearms, you could build Full Autos, but they (obviously) couldnt be purchased unless the buyer was LEO. Another post made reference to the fact that you couldn't build a FA rifle unless a request for a demo was recieved for the item, and it had to be destroyed if the LEO did not purchase it. Yet another post stated that it was legal to build your own FA rifle if you had the license, but could never sell it, and if you forfit your license, the firearm had to be destroyed.

I searched the ATF website, but they give almost no specific answers regarding any firearm related topic. I was hoping someone here could clear this up.


EDIT: Late addition... source and quote from one of the pages I found regarding the laws.

Owning or making an NFA weapon

It is illegal for anyone to have possession of an NFA weapon
that is not registered to them in the NFA Registry. It is also
not possible for anyone, except government entities, to register an
existing NFA weapon that is not registered, except immediately
after one is made by a class 2 NFA manufacturer. An individual
otherwise able to own any gun under federal law can receive and
own any NFA weapon (local law permitting, ATF cannot approve a
transfer where federal, state or local law would be violated by
the transferee possessing the weapon in question, see 26 USC sec.
5812(a)(6)) on a Form 4, "Application for Tax Paid Transfer and
Registration of Firearm". Non-FFL holders may only purchase an
NFA weapon from a dealer or individual within their own state.
If the weapon is located out of state it must be transferred to a
class 3 dealer within the state, before transfer to the non FFL
purchaser. C&R FFL holders (type 03) may purchase C&R NFA guns
from out of state dealers and individuals. Type 01 FFL holders
may purchase any fully transferrable (no dealer samples, see
below) NFA weapon, from an out of state source. If the FFL
holder is an individual he must submit fingerprints, photograph,
and the law enforcement certification.

The transfer involves paying the transfer tax, which is $200
for all the NFA weapons, except AOW's for which the tax is a
mere $5. Individuals also have to get one of several specified
local chief law enforcement officers to sign the form (see the
section on the law enforcement certification for more
information), submit their fingerprints in duplicate, and attach
photos of the transferee to the form. While the transfer tax is
levied by law on the transferor (seller), in practice the
transferee (buyer) is expected to pay the tax. Transfers to
individuals tend to take at least 4 months, although subsequent
transfers can be quicker.

Or you can make any NFA weapon, except for machine guns (see
below), by filing a Form 1, "Application to Make and Register a
Firearm", and paying the $200 making tax, which applies to all of
these weapons, including AOW's. You may not make the proposed
weapon until the Form 1 is returned to you approved. The law
enforcement certification, photos and fingerprints also apply to
Form 1's, and in fact to any transaction to an individual.
Additionally the manufacturer of any NFA weapon, including an
individual making one on a Form 1 must mark the receiver of the
weapon with the maker's name and city and state. NFA Branch can
grant exemptions from this for DD's. All types of corporations,
including corporate type 01 FFL holders, need not do the
certification, photo and fingerprint requirements. Any of the
forms listed, and the fingerprint cards, are available for free
from ATF, either in Washington, D.C. or your local office.

[WillBrayjr]

You obviously can't build a full-auto AR completely out of new parts as a civilian. If you can find a pre-86 reciever/trigger group than the rest can as far as I know can be all new parts. The reciever and in most cases the trigger group are considered the firearm.

[Chris Phelps]

Thanks, but that didnt answer my question. What you are talking about can be done by anyone... you just pay the $200 tax stamp on the NFA part (ie DIAS, Lightning Link, or Colt Registered Lower Reciever).

What I am talking about is the ability to manufactur, from scratch, items such as a DIAS. It appears to me that this is perfectly legal, so long as you are a Class 2 manufacturer License Holder. THIS would be the question.


Also, according to the artical I quoted above... as a Class II holder, you can also import pre-86 full auto rifles as "samples". FYI.

[shaggy]

A licensed manufacturer can make post-86 machineguns for sales to qualified buyers. To get the 07 FFL and SOT, however, you need to be actively engaged in the business. If you just want to get guns for your own use and your personal collection, getting a manufacturers license is a very bad idea. If you do not do enough business to justify the license BATFE can revoke the license and (if you have bought transferables or pre-samples) charge you with tax evasion. Additionally, the manufacturing license is not cheap. The 07/FFL is fairly cheap ($30/year IIRC), the SOT is $500/year, but the ITAR fee to the State Dept. is about $1650/year. All in all, you are at well over $2000/year which doesn't include the cost of all required local and state business licenses, insurance, and rent on a properly zoned premises. Your local zoning regulations for the liocensed premises must not be incompatible with light industrial applications, so you probably can't operate it out of your home. And even if you could, the licensed premises is subject to inspection by BATFE, so do you really want to have to let them in your home?

Once an 07/SOT makes a post-sample, they can only keep it so long as they have their license. When they give up the license (or if BATFE rescinds it) all post samples must be sold to a qualified purchaser (a LE agency or another SOT with a LE demonstration request letter), or they must be destroyed.

So, without even considering the other drawbacks of an SOT, do the math. Four years of having a manufacturing license will cost you approximately $10,000 in licenses and fees. At the end of that time, if you made a post-smaple M16 you would have a gun worth about $500 in spare parts. Thats about $9500 down the drain.

In contrast, if you bought a transferable M16 today for $10,000 at the end of four years you'd have a gun worth at least $10,000, and probably more along the lines of $12,000 or $13,000. You'd get every penny of your initial $10,000 investment back as well as probably a net gain of $2k-3k.

[Chris Phelps]

I was definitly unaware of the $1,650 state fees. According to the ATF, if they feel you have purchased your man. license as a way around the tax, their first step is to recind your license and force you to pay all applicable taxes. your $500 would be used as credit toward these fees. Tax evasion is reserved for people who purchase a manufacturers license and then end up buying 100s of "samples" from another country. It is a last resort.


M16's cannot be purchased for $10,000 at this current point in the game. DIAS are being sold for about $18,000 and Lightning Links are being sold for about $10,000. Colt registered lower recievers average about $16,000.

The fact that NFA prices have become rediculas is what got me thinking about alternatives. Apparently, there are none. I am unwilling to spend $18,000 to convert a firearm though... based on my past luck and experiences, I would save up for 6 years, drop the $18k, and the very next week, the NFA would be abolished, leaving me with a $20 DIAS.

[shaggy]

Chris, prices aren't quite as bad as what you post - an RDIAS can be had for $11-13k if you have cash at the ready. Lightning links are stock in the $7k range. Good registered receiver M16s (non-Colt) can easily be had at about the $10k mark. And FWIW, the tax evasion charge is very real and not just reserved for those importing hundreds of samples from overseas. There are a number of former FFL/SOTs who are now felons due to the tax evasion charge. IIRC, thats what they got Bill Flemming on. Regardless, if you want MGs for your own collection and don't intend to really be in the business, the FFL/SOT is not the way to go.

[ArizonaJim]

And....the chance of the NFA being abolished is exactly zero.

I would be more concened with them voiding all the tax stamps and making all NFA contraband.