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Ok I have another question.... I have not shipped the firearm to my father yet since his FFL has been closed through the holidays (he lives in small town with only 2 FFLs). Today I called his FFL to confirm the transfer info. The dealer informed me of the very reasonable transfer fee of $15 and then he said plus 6% tax which struck me as odd. So I did the math and the total was $15.90 still no biggie but I wondered why he didn't just say $15.90 so I asked him to be sure I understood. He then proceeded to tell me the tax was being assessed against the firearms value. I informed the dealer that I was not selling the firearm but I was giving it as a gift. The recipient would only be paying the transfer and background fees (I already checked to be sure the state doesn't charge a gift tax). I also informed the dealer that I had paid the sales tax when I purchased the firearm . He told me that it didn't matter, he has to charge the tax because he was transferring the firearm from me to the shop then to my father. I think he's cracked and that he is doing something illegal. So suffice it to say I'm going to use the other FFL. So to all of you FFLs out there, am I correct to think this guy is cracked or am I way off base here?

I find at least four transfer dealers in the Houston area that also charge sales tax. Presumably, only on the transfer fee.

One dealer charges $20 for the transfer PLUS 10% of the firearm purchase price PLUS tax.

All you can do is avoid such dealers.

If you not aware, Gunbroker.com has an FFL locator. One of the options is distance from a particular zip code.

I have found another FFL that I will be using. When I asked him what he thought of my original FFL's practices he thought the practice was inappropriate or possibly illegal. I understand he would have to log receipt of the firearm but that's not what he described. If his practices are illegal and he's using them to collect money that is not owed then he needs to be investigated. I'm just not sure what he's doing is illegal and I want to be sure before I cause him undue harm.

Is it legal for an FFL performing a firearm transfer from one private party to another to first transfer that firearm into the FFL business name before transferring it to the intended party? The transfer is not due to a sale of said firearm but as a gift to another.

urnoodle wrote:Is it legal for an FFL performing a firearm transfer from one private party to another to first transfer that firearm into the FFL business name before transferring it to the intended party? The transfer is not due to a sale of said firearm but as a gift to another.

I've never had to use a FFL for an out-of-state, shipped gift, but for all the transfer due to sales I've had done, the FFL never transfers the firearms to the FFL business name first; the FFL has always recorded the transfer of the weapon directly from the originating party (the manufacturer or sales outlet in my cases) to me. The caveat being that I've never inspected the actual forms/log that my FFL uses for his record keeping purposes, just the 4473.

You may want to PM a FFL on the board. I know OldCannon is one, although I'm sure we have quite a few others here, too.

I've had a similar experiences as what you stated so his practice took me by surprise. I'll PM OldCannon and see if it's just something I'm not familar with.

IDT, there is anything illegal (in most states) about charging a tax however, all "tax" collected must be paid to the proper authority. Some people, even outside of an FFL, do it just to be safe.

I don't believe you can assess a tax on a non-sale of an item you don't own and aren't selling but that's not where my question of legality it. My question of legality stems from whether the FFL can transfer my firearm into his personal business name before transferring it to my father.

urnoodle wrote:I don't believe you can assess a tax on a non-sale of an item you don't own and aren't selling but that's not where my question of legality it. My question of legality stems from whether the FFL can transfer my firearm into his personal business name before transferring it to my father.

The FFL is required to log the firearm into his A&D book and at that point, technically, it belongs to the FFL. The 4473 is what transfers the firearm from the FFL to the receiving individual. So yes, the FFL can and is required to transfer it into the business name.

The charging tax thing on the transfer - I've never done that and I wouldn't. I'm not selling something, I'm just moving it around via paperwork. sounds to me like that FFL is cheating people and probably the state he's in too.

So my understanding of the log book is incorrect. I understood the log book to only signify acquisition and disposition not ownership. How would one prove ownership should the recipient fail the NCIS check or something happen to either the FFL or the recipient before the transfer has been completed?

He is scamming people. Sales tax is collected on price of the goods sold in taxable transactions. The cost of the firearm was never part of the transaction. I reasonably certain he never submits those monies tot he state, just collects the "tax" and keeps it.