Thinking about getting an FFL License? Here’s where you need to start. We cover each step of the process and give you the tips and tricks to be successful.
Ok, first off, there’s really no such thing as a “Class 3 License.”
Instead, someone who has a Federal Firearms License, must become a Special Occupational Taxpayer (SOT) in order to deal, manufacture, or import a certain category of firearms called NFA Firearms/Title II firearms. This special category of firearms includes Silencers (suppressors), Short Barreled Rifles (SBRs), Short Barreled Shotguns (SBS), Full-Auto Machine Guns, and “Any Other Weapons” (AOWs).
An SOT is a taxpayer (entity) with an FFL that has registered with the federal government and paid an annual tax. The status as an SOT applies to the entity (business). This means that a business can get more than one FFL and it can rely on its status as the same SOT.
The SOT tax must be paid every year by July 1st, and the cost of the FFL and SOT registration varies per FFL Type and, in some cases, by annual sales. Unfortunately, if you decide to become an SOT on June 1st, you’ll either need to pay again for the next year on July 1st, or you’ll need to wait until July 1st to start the next SOT tax year.
Depending on the activity the FFL wants to engage in with NFA Firearms, they must become one of 3 classes of SOT and have a certain type of FFL.
Activity | SOT Class | FFL Types |
---|---|---|
Buy/Sell NFA Firearms | Class 3 | 1, 2, and 9 |
Make NFA Firearms | Class 2 | 7 and 10 |
Import NFA Firearms | Class 1 | 8 and 11 |
This is why your local gun shop which sells NFA firearms is sometimes called a “Class 3 Dealer.” They don’t have a “Class 3 license,” but rather are likely a Type 1 FFL who has become a Class 3 SOT.
There’s really no such thing as a “Class 3” firearm either.
Yes, an FFL must be a Class 3 dealer (is a Class 3 SOT) in order to sell NFA firearms. However, the NFA firearms themselves aren’t “Class 3.” As you can see in the above chart, every NFA Firearm was either imported by a Class 1 Importer (is a Class 1 SOT) or it was made by a Class 2 Manufacturer (is a Class 2 SOT). Therefore, the same NFA firearm likely passes through different Classes of SOTs.
This is what most people are wondering about when they ask, “How do I become a Class 3 License?”
The first step is to become a Federal Firearm Licensee. In another article, we’ve broken down how to get your FFL in 4 easy steps, and we offer classes which help you get your FFL.
After you have your FFL, you’re ready to register as an SOT and pay the appropriate tax:
So, there you have it.
You don’t want a Class 3 License – instead, you might want to be a Class 3 SOT with a Dealer License, or a Class 2 SOT with a manufacturer’s license.
In four simple steps, you can become a licensed firearm manufacturer, dealer, and/or international arms exporter or importer of NFA firearms as a Class, 1, 2, or 3 special occupational taxpayer (SOT).
I’m looking forward to having you in our industry,
Technically, you do not “get” an SOT. Instead, it is something you become by registering as a “Special Occupational Taxpayer” (SOT) once you already have your FFL.
We break down the process to becoming an SOT in this article.
You must first get an FFL before becoming an SOT.
After you have an FFL, you can then register for whichever class of SOT is appropriate.
Whether you need to become an SOT depends on the type of firearms you want to work with.
If you are only dealing with standard firearms (rifles, shotguns, handguns), then you do NOT need to become an SOT. However, if you’d like to work with NFA Firearms like machine guns, short barreled rifles, silencers, and more, then you must register as an SOT.
The ATF permits interstate travel with an FFL/SOT, but that does not exempt you from following state laws. Be very careful with this. We recommend becoming an ATF Compliance member for help with these tougher ATF Compliance topics.
In most cases, it costs $500 annually to become an SOT.
However, for businesses making over $500k a year, the cost to register as an SOT goes up to $1000.
[…] an individual, a silencer can be purchased from a “Class 3 firearms dealer,” or more accurately an FFL with a Class 3 SOT, or from another individual to whom the […]
So if I were to register and get through the whole process in which I have the class 3 dealer license, what would happen to any of the firearms I would buy that are registered in my name like a MP5 or M4, if I died, would they be put in a will or would they be taken by the ATF or something since let’s say my son doesn’t have a license to deal them so he cannot own them
Thank you very much for this information. I would love to become an FFL/SOT without buy/sell just a “make” and “import” SOT. The price per year is what deters me. If I am doing this for personal gain it will be expensive but I get all the cool toys Reagan prohibited. Hope this works.
Do you guys help people through the process class 3 licenses?
Yes, we do! Our most popular option is taking our Get your FFL course and our Become an SOt course.