Edit: UncleNick beat me to it but I'll leave this here for the applicable law references.
This would be, AT BEST, a legal grey area. It is illegal for an unlicensed person to manufacture ammunition "for livelihood or profit"...
Quote:
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Originally Posted by http://www.atf.gov/firearms/faq/faq2.htm#h4
(H4) Is a person who reloads ammunition required to be licensed as a manufacturer? [Back]
Yes, if the person engages in the business of selling or distributing reloads for the purpose of livelihood and profit. No, if the person reloads only for personal use.
[18 U.S.C. 922(a) (i) and 923(a), 27 CFR 478.41]
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Frankly, it seems out right illegal to me. The brass that the person keeps is pretty undeniably "profit". If it weren't why wouldn't they just buy their own?
The actual text of the law is even clearer:
18 U.S.C. 922
(a)
It shall be unlawful—
(1) for any person—
(A) except a licensed importer, licensed manufacturer, or licensed dealer, to engage in the business of importing, manufacturing, or dealing in firearms, or in the course of such business to ship, transport, or receive any firearm in interstate or foreign commerce; or
(B)
except a licensed importer or licensed manufacturer, to engage in the business of importing or manufacturing ammunition, or in the course of such business, to ship, transport, or receive any ammunition in interstate or foreign commerce;