Does a FFL / SOT pay a NFA tax if he makes a SBR...?

I think I know the answer but not sure I'm current.

I'm an 01 FFL, not a manufacturer. But I pay an annual SOT so I don't have to pay NFA taxes on each individual item.

This means if I purchase a SBR from a manufacturer, it comes on a Form 3 and I don't have to pay the NFA tax because I'm a SOT and pay an annual NFA tax.

But what if I form 1 a SBR? Am I no different from non licensee's and I pay a NFA tax on top of my SOT tax?

In the past when I have done SBRs, it usually required some kind of gunsmithing so I just sent things to a 07 / SOT, they registered the SBR and did the work and it came back to me on a Form 3. But this time I have a project that requires no gunsmithing of any kind, just registration before final assembly can begin.

It still might be cheaper to send it out to have somebody do nothing more than register, engrave and Form 3 it back to me but if I can do it myself I'd rather do it that way.

unfortunately yes. Thats why when it was time to renew the last go around, I submitted paperwork and let my 01 expire and transferred everything to an 07 so now I'm an 07/02.

There are advantages and disadvatages. WAY more paperwork (separate book for everything that is "retail" and everything that is manufactured by you) is a pain. You can't manufacture more than 50 firearms per year or you pay excise tax.

But the advantage is you can now make what ever you want, Form 2 it after its manufactured and have fun. No demo letter needed to make a machine gun. Only downside is you can't sell it to anyone but LEO/MIL/FFL. I've made a few Suppressors and sold those and a few SBR's and sold those, they just go thru the normal Form 4 process with you now being the manufacturer.

Thanks, that's what I thought.

a sort of different question. i am an 01. i transferred a lower to work and we built an sbr out of it for our SRO on a form 5. the SRO program is ending next year and work doesn't need the rifle anymore. Can I form 5 it back to myself tax free?

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Originally Posted by Chowser

a sort of different question. i am an 01. i transferred a lower to work and we built an sbr out of it for our SRO on a form 5. the SRO program is ending next year and work doesn't need the rifle anymore. Can I form 5 it back to myself tax free?

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You'd need to contact NFA division on that as I'm unsure, never dealt with that before.