Follow the law when selling or trading firearms.
Selling and trading guns can be profitable, but there are federal and state laws regarding such transactions. These laws govern the private sale and public sale of guns differently. Private sales are those conducted between two people, while public sales are made by gun shop owners, pawnbrokers and other professional gun dealers. If you intend to sell or trade guns, you must make sure that every transaction abides by federal and local laws.
1. Make sure the gun transaction you intend to complete constitutes a private sale or trade. That is, that you are not operating as a gun store or pawnbroker, but making a private sale or trade conducted between two people. One example is if you were to sell your rifle to someone at a garage sale.
2. Check to make sure the buyer lives in your state. According to the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), the federal Gun Control Act dictates that you may sell or trade a firearm to anyone in your state if you believe that person is not restricted by law from owning a gun. However, you may not sell or trade a gun to anyone outside your state unless the gun is first transferred to a dealer who holds a Federal Firearms License and operates in the buyer’s state. After you transfer the gun to the dealer, the buyer can pick up his gun once he passes a background check.
Keep in mind that local gun ordinances may require other stipulations when selling and trading firearms. Contact your local police department to find out local regulations.
3. Print a bill of sale indicating that you sold the gun. Be sure to write down the buyer’s name and driver’s license number and the date of the sale or trade. Keeping a bill of sale is not always required by law, but it is a good idea to have proof you sold your gun in case it is used in a future crime.
4. Obtain a Federal Firearms License. Consult the ATF to determine what type of FFL you will need in order to sell or trade guns in a store-owner capacity. You will need a Type 2 FFL to deal as a pawnbroker. If you plan to sell National Firearms Act (NFA) destructive devices, including machine guns, short-barrel rifles and sound suppressors, you will need a Type 9 FFL. You will also need to obtain Class 3 Special Occupation Tax (SOT) status. You will be levied a special tax for dealing in NFA firearms.
5. Learn the laws for buying and selling firearms in your state. Run a background check on everyone who buys a gun. As a licensed dealer, it is illegal not to run a background check, or to sell a gun to someone who fails a background check. You can be prosecuted and lose your FFL if you do not comply.
6. Ship the purchased firearm to a licensed FFL dealer in the purchaser’s state, if the buyer is from out of state.
7. Keep a detailed ‘bound book’ of every transaction you make regarding the sale and purchase of firearms.