Legal Issues

ATF Changes Definition — Are you a gun dealer?

Selling your guns like this at a local gun show is common.

Downsizing and selling a few guns? Perhaps you are selling a few of your early budget guns to afford the dream gun you’ve always wanted. What about selling off a gun collection of a family member who has passed? Perhaps that person had a substantial collection, over 100 guns and you are going to have to put some time into cataloging and listing them for sale… Will the ATF’s new rule (definition change) make you a dealer? Will that earn you that dreaded knock on the door as the sun breaks the horizon? All I can say is “Hide the dog…”

What if you are a person of a few means and looking for the perfect handgun for concealed carry. You buy your first choice, but quickly realize it is too big. You sell it a couple weeks later and return to buy your second choice. A week later, you realize it is too small, too heavy, sharp edges etc., so you sell it, peruse your favorite website, and order the next candidate. Would this make you a gun dealer according to the ATF? Read on and find out.

Protestors outside a state building holding a "don't tread on me" flag
Once again, instead of creating a law through the legislative process, the ATF is ‘redefining’ to circumvent the process.

ATF Rule 2022R-17

Summary

The Department of Justice (“Department”) proposes amending Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF”) regulations to implement the provisions of the Bipartisan Safer Communities Act (“BSCA”), effective June 25, 2022, that broaden the definition of when a person is considered “engaged in the business” as a dealer in firearms other than a gunsmith or pawnbroker. This proposed rule incorporates the BSCA’s definition of “predominantly earn a profit,” creates a stand-alone definition of “terrorism,” and amends the definitions of “principal objective of livelihood and profit” and “engaged in the business” to ensure each conforms with the BSCA’s statutory changes and can be relied upon by the public.

The proposed rule also clarifies what it means for a person to be “engaged in the business” of dealing in firearms, and to have the intent to “predominantly earn a profit” from the sale or disposition of firearms. In addition, it clarifies the term “dealer,” including how that term applies to auctioneers, and defines the term “responsible person.” These proposed changes would assist persons in understanding when they are required to have a license to deal in firearms.

Consistent with the Gun Control Act (“GCA”) and existing regulations, the proposed rule also defines the term “personal collection” to clarify when persons are not “engaged in the business” because they make only occasional sales to enhance a personal collection, or for a hobby, or if the firearms they sell are all or part of a personal collection.

This proposed rule further addresses the lawful ways in which former licensees, and responsible persons acting on behalf of such licensees, may liquidate business inventory upon revocation or other termination of their license. Finally, the proposed rule clarifies that a licensee transferring a firearm to another licensee must do so by following the verification and recordkeeping procedures instead of using a Firearms Transaction Record, ATF Form 4473.

The final version of ATF Rule 2022R-17 has been submitted to the Federal Register and goes into effect 30 days after the date of publication. ATF Rule 2022R-17 broadens the definition of who is “engaged in the business” as a dealer in firearms and finalizes many amendments to regulatory definitions.

A person will be considered to be “engaged in the business” as a dealer in firearms, when that person:

The Rule finalizes the amendment to the regulatory definition of “Dealer” to clarify that firearms dealing may occur wherever, or through whatever medium, qualifying domestic or international activities are conducted.

The Rule also “finalizes an amendment to the regulatory definition of “engaged in the business” to define the terms “purchase” and “sale” as they apply to dealers to include any method of payment or medium of exchange for a firearm, including services or illicit forms of payment (e.g., controlled substances).  “Resale” is defined to mean “selling a firearm, including a stolen firearm, after it was previously sold by the original manufacturer or any other person.””

Providing services is considered a medium of exchange, so the ATF has codified its “historical exclusion for auctioneers who provide only auction services on commission to assist in liquidating firearms at an ‘estate-type’ auction.”

The ruling states that a “licensee transferring a firearm to another licensee, must do so by following the verification and recordkeeping procedures in the regulations, rather than by using a Firearms Transaction Record, ATF Form 4473.”

“The final rule recognizes that individuals who purchase firearms for the enhancement of a personal collection or a legitimate hobby are permitted by the GCA to occasionally buy and sell firearms for those purposes, or occasionally resell to a licensee or to a family member for lawful purposes, without the need to obtain a license.”

Without an FFL, an individual must ensure they are not “engaged in the business” and the transaction is not “to predominantly earn a profit”, which now focuses only on whether the intent of the underlying sale or disposition of the firearms is predominantly of the obtaining pecuniary gain. Individuals may continue to engage in private intrastate sales, without a license, provided the individuals are not “engaged in the business” and the transaction is otherwise compliance with the law.

Q&A From the ATF

Q. Why does the Final rule change the definition of a “dealer”?

A. The Gun Control Act was passed in 1968, and the Firearms Owners’ Protection Act modified it in 1986. Since then, there have been significant advancements in manufacturing (e.g., 3D printing) and distribution technology (e.g., Internet), and changes in the marketplace and products (e.g., large-scale gun shows). These have increased the ways in which individuals shop for firearms and have therefore created a need for more clarity in the regulatory definition of “dealer” in the diverse modern marketplace, especially with the BSCA amendments to what constitutes being “engaged in the business” as a dealer. The final rule amended the definition of “dealer” to clarify that, under the changes to “engaged in the business” made by the BSCA, a person still meets the statutory definition of a dealer in firearms in the modern marketplace, regardless of where they buy and sell firearms, regardless of which medium they use to do so, and regardless of which medium of payment or exchange they use.

Q. Is the term “occasional” defined in the BSCA or the final rule when addressing sales, exchanges, or purchases of firearms?

A. No. The term “occasional” is not defined in the regulatory text; however, the plain and ordinary meaning of that term is “infrequent or irregular occurrence.” However, regular or routine sales, exchanges, or purchases of firearms (even part-time) for the enhancement of a personal collection or for a hobby would not fall within the meaning of that term.

Q. If I only dedicate a few hours to selling firearms to predominantly earn a profit, am I considered a “dealer”?

A. Yes. The term includes any person who engages in such business or occupation on a parttime basis.

Q. Does the final rule require every private sale of a firearm be processed through a licensed dealer?

A. No. Individuals may continue to make intrastate private sales without a license provided they do not rise to the level of being “engaged in the business,” and the transactions are otherwise compliant with law.

Q. If a person sells their personal firearm and makes a profit, does that equate to being engaged in the business as a dealer requiring a license?

A. No. A person actually “selling at a profit does not equate to engaging in the business” because a showing of actual profit, whether expenses or inflation are considered, is not required to be engaged in the business. Rather, it is the predominant intent of obtaining pecuniary gain from sale or disposition of firearms that matters. See 18 U.S.C. § 921(a)(22). Moreover, because the person’s predominant intent to profit is the relevant fact, it does not matter how or whether actual profit is calculated.

Conclusion

The main takeaway for most who are not ‘engaged in the business’ is to change the way we do things. No longer would a private party transfer offer a bill of sale — whether you are going through a FFL to do the 4473 transfer. Instead, use a bill of transfer sans a purchase amount. Don’t mention or admit to buying a gun as an investment. Don’t buy a gun at a show with the intention of ‘flipping’ it?

ultra-rare Winchester Model 21 cased Grand Royal
The new Rule could make collectors into criminals overnight.

Instead of creating a new law that must go through the legislative process, the ATF has once again taken the strategy of ‘redefining’ an existing law to clarify (change) it. Remember, the ATF took one page from the Safer Communities Act and added over 100 pages of its own commentary to ‘explain’ it with ATF Rule 2022R-17… And that’s never good for you, me, or the Second Amendment… In my opinion, of course.

What do you think of the ATF’s new Rule (ATF Rule 2022R-17)? Will it make our streets safer as the ATF and anti-gunners would have you believe? Or, is the new Rule nothing more than another step toward making law abiding gun owners into criminals? Share your answers in the Comment section.

The Mission of Cheaper Than Dirt!'s blog, The Shooter's Log, is to provide information—not opinions—to our customers and the shooting community. We want you, our readers, to be able to make informed decisions. The information provided here does not represent the views of Cheaper Than Dirt!

Comments (36)

  1. There are several things that worry me about this with who decides what “engaged in the business” means and where the thresholds are for that definition. Government overreach is real and this feels a lot like the tail wagging the dog.

    Such a depressing time in our country, why not crack down on the criminals committing crime with firearms and hold them accountable. We are watching law abiding citizens be overregulated and smothered with overreach. Not the America I grew up with or want for my children and grandkids!

  2. In Illinois, only those who are felons or gangbangers are permitted to own or transfer or conceal firearms w/o state bureaucracy or harassment.
    For regular law-abiding folks it is “Hands Against the Wall!”

  3. The Strongest Reason for the People to Retain the Right to Keep and Bear Arms is, As A Last Resort, To Protect Themselves AGAINST TYRRANY AGAINST THE GOVERNMENT.!! I will not stand or Bow down to Anyone in Government PERIOD…………………….

  4. This is part of the plan, to slowly erode our right bear arms until it no longer exists. But don’t blame Biden, he is just a senile puppet of the foreign controlled Democrat party that does & says what he is told.

  5. When are the Republican politicians going to force the ATF to appear before them whenever the BATF wants to increase the regulations? What about the 2nd Amendment doesn’t the politicos understand that our rights to gun ownership shall not be abridged?

    If these pseudo fascists would just be honest and say “we are going to take all of the guns by over regulating” then we would realize that we have lost our country.This Fabian Socialism is the method that Lenin stated was the doorway to Communism, The camel under the tent allegory!

    Maybe in the next 6 months the Republicans can get spines!

  6. With the obvious “two tier” justice system employed by the federal government, it’s only common sense that any of these regulations, amended or not are contrary to what our founders had originally drafted in our “Bill of Rights” and the “Constitution of the United States of America”.
    It appears evident to me that most, if not all of the “modifications” and additions to our originaly intended application of these documents has been only for the purpose of giving more control by the federal government over sincere, law abiding citizens. The changes to the, already overreaching and unconstitutional rules of the A.T.F.and E. only bring us closer to having to submit to an already burgeoning federal government whose intentions are primarily to glean as much tax money as possible to launder through congress for distribution to their elite constituents and political contributors.
    I’m hoping the people of our country will “wake up” to the tyranny being conducted by our federal government, indite all participants for treason and disband all the unnecessary three letters agencies along with all of their intrusive regulations.
    This can only occur if realistic laws are enforced and convictions are carried out with realistic consequences upheld in a court of law.
    Ultimately, the federal government must be pared down to its original size and scope in order to let the people live their lives in pursuit of happiness as individuals and not the “collective” communities the global elite would prefer.

  7. Tried to leave a comment but it kept telling me that it was a duplicate of a comment that I already made.
    This must be a clandestine ATF site.

    1. Hardly… All comments are moderated before they go live. It just takes a little time before we can get to them. ~Dave

  8. Looks like they finally figured out how to shut down gun shows or at least restrict them to registered dealers who are in the business for profit.
    The streets are not going to be any safer because no matter how many laws are passed concerning the sale of firearms, only law abiding citizens are going to obey them.
    If law enforcement and the ATF put a thousandth of the effort to rein in criminals selling firearms illegally as they do going after law abiding citizens for legally owning firearms, this country would not have near the crime with firearms that it does now.

  9. This is yet one more effort to dismantle the 2nd Amendment through the death of a thousand cuts. As occasional is not legally defined, this means anyone who sells a firearm is at the mercy of the ATF agent involved. This is also an example of an agency in search of a problem that seeks to be described as “being productive”.

  10. “HW STONE”… this is exactly what I was thinking. I remember the 1984 ban. Guys who bought an AR and suddenly realized that they could make some money on something they bought years before were doing just that. No evil intentions, just utilizing the market to help pay off debts. If my children or grandchildren don’t or can’t have them then why can’t I sell them to pay my final expenses? The government isn’t going to give me anything for them but a hard time

  11. Ambiguous language leaves room for agents to make decisions based on their opinion. Reminds me of tactics used by agencies in communist countries to keep the population on edge. If no one knows the exact definition of the rules, the agents can define them on the fly for their own gain. Well defined, well enforced, and precisely worded law provides confidence by citizens in that law.

  12. Here we go again with the ATF! overstepping their authority, they can make a “rule” all they want, it’s unconstitutional for them to enforce a “RULE” if it’s not LAW…..

  13. Chicago is a perfect example of how all these gun statutes, codes, regulations work. It’s certainly isn’t law because it doesn’t line up with the constitution. It’s either control or profits that generate all the new legalese or as stated earlier… cherry pick who they want to take down for personal or political gain… pretty straight forward bullshit!

  14. The ATF needs to be disbanded! The NFA, GCA, and this Safer Communities Act all need to be repealed! This is at it’s core an infringement on the 2nd and has no historical precedent at the time of the writing/ratification of the Constitution! It amazes me how lower courts and Federal/Local Government and law enforcement are ignoring the Supreme Court without consequence!

  15. It’s not as if heavily armed ATF agents will enter your home in the wee hours of the morning and shoot you for . . oh, wait, never mind.

  16. wonder how this applies to someone selling a class III item….where a large profit, largely accrued from government action…is certain to be gained?

  17. As usual, all talk no walk! It just serves to allow the Feds to over reach as is the common pratice? Does any of this surprise anyone? More bs from folks known for bs and criminals don’t follow laws nor will comply! That just leaves making criminals out of regular folk when ever the mood strikes them!!!

  18. All this means to me is that if you decide to sell off part of your gun collection in private sales, the ATF can legally murder you…after they shoot your dog.

  19. All this does is make it tougher on the law-abiding person. No one involved in any illegal activity will be affected by it. This “clarification” only makes things more confusing as none of the terms are defined. Occasional buy or sell. How often is that, how many firearms can be sold between persons at one time? The list could go on and on. Now the definition of these terms is left up to total interpretation by the courts and ATF which is never a good thing.
    Instead of more regulations, rules and definitions that will contradict and confuse the situation. Make it so a felon in possession of a firearm at any time under any circumstance is a minimum ten- or fifteen-year sentence to run consecutively with any other sentence imposed by a court. Make it so three quarters of the sentence must be completed before being eligible for parole. Or make it a serve all and no parole.
    I read the sections provided and, in my mind, it created more questions than it answered. What I did understand is that the Feds. now have made it open season on American citizens. Going by this example federal and possibly state or local government agencies can create rules and terms that have the effect of law without having to go through the process of a new law being created. Liberal gun haters have figured out that they cannot legally strip gun owners of their rights. Therefore, they are going the long way around to do it with this process instead.
    I’m just glad I have sold all of my guns and don’t have any in my possession!!ATF are you listening?

  20. Same ‘ol BS. Rule by bureaucrats, NOT by elected officials. They’re trying to make criminals out of honest Americans, while releasing the real criminals from prison or jail, or without bond!

  21. It’s way past time to eliminate this government agency, this taxpayers funded group of clowns are strictly insane! This is OK, no It’s not, yes it is, no it’s not! Lunacy, how about first: follow the Constitution, Second, file for unemployment

  22. Does this apply to Mex and the Cartels shipping guns into the USA? Or, maybe the street gangs arming themselves?

  23. Its a bunch of hog wash that is to do nothing more than put chains on gun owners.the govt.if left alone will certainly screw every gun owner in the u.s.I’m so sick of these pinko commies trying to disarm law abiding citizens to fit their bill.they can go to hell I’m not selling my guns to anyone.I need all mine for protection. They are trying to get it if you die the collect your guns from your family.that’s bullshit!!!!!atf has no authority to write bills and the Supreme courts need to step in and slap them knuckles for them.my guns will only leave my cold dead hands!!!!if I chose to sell one I will and I don’t give a damn about it.we as Americans better get smart about all these back room deals screwing gun owners.if you let them they will take your guns then they will come for your house,your kids,your wife or husband ,your car or anything else because how are you gonna stop them you can’t without protection. So all these money hungry bastards can kiss my happy ass.

  24. If one page of law isn’t clear to the average citizen, then the law needs to be rewritten. 100 pages of “interpretation” by a government agency so that citizens can then understand the original law clarifies nothing. Our legislators agreed that the law was adequately clear when it was written. This type of action, in and of itself, is an obvious overreach and should be illegal.

  25. No won’t make streets safer. (Do bad guys follow laws?) And yes, makes citizens into criminals (see Australia). ATF can be likened to the UN… never actually protected anyone

  26. More overreaching, unconstitutional bullying from ATF UNELECTED bureaucrats and the communist Biden regime.
    This will do absolutely NOTHING to decrease crime or make the public safer.
    ATF is too afraid to confront real criminals and drug cartels so they justify their existence by going after law-abiding citizens. Very little difference from nazi gestapo or communist stasi
    DEFUND THE ATF NOW!

  27. One point that will need to be addressed– if a person purchases a pistol in 2000 because he feels it is a great investment, and in 2025 he sells it for twenty times what he paid for it, is that something that meets the definition of the “for profit” question?

    A lot of people invested in guns long term, just like buying stock, just stock without all of the drama of brokers and takeover bids.

    It might be suggested to those who write the rules that anything held for ten years or longer does not trigger the “for a profit” rule.

    .

  28. Any new rules regardless of what government agency decides to add or alter is not going to change the intent of the criminal element.
    You can’t regulate human behavior and in the end only lawful people will affected. This ruling is just another attempt to place another speed bump into the second amendment.

  29. When is a Right not a Right? When the entity specifically prohibited from impacting that right illegally delegates authority to impact it through regulation. Neither congress or the legislative branch have the authority to delegate control of a right that is specifically barred from them by the Constitution.

  30. “The new Rule could make collectors into criminals overnight” That, of course, is the purpose. It is one of many steps by the Lyin’ Joe Biden administration to disarm law abiding citizens.

  31. I, LITERALLY, hate those clockshuckers st ATF. They have cast their shadows on my doorstep one too many times; and I want to listen to them squeal like piglets while they bleed out.

    BUT…that being said, for all my collecting and collection, once in a blue moon selling off one or few to finance a new acquire; these stupid. Unnecessary, disengenuous rule changes would not affect me. But, hey ATF, fuck you; stay outta mu business.

  32. I am sure that the person who just stole a gun from a car with the intent of selling it to his partner in crime, and sure to make a profit, will remember to apply for his FFL before the sale. This has little or nothing to do with making our communities safer. It will only make law abiding citizens criminals. The real criminals will rarely ever get caught, and if they do recent history proves they will be back on the street the next day, no bail. This new rule is so vague (intent and presumption) the ATF will cherry pick only the people they want to make an example of. Although the new rule does specify if you buy a gun with the intent to sell it for a profit, it does not say you can’t steal a gun to sell for a profit. The scary part is when was the last time in the past three years our government promised safer, better, lower inflation, more unity, higher wages,etc etc etc and just the opposit occurred.

  33. Whenever you go from one page to one hundred pages, it is a bad thing. This will do nothing to stop those with bad intentions. It will only endanger the rights and safety of law-abiding citizens.

Your email address will not be published. Required fields are marked *

Your discussions, feedback and comments are welcome here as long as they are relevant and insightful. Please be respectful of others. We reserve the right to edit as appropriate, delete profane, harassing, abusive and spam comments or posts, and block repeat offenders. All comments are held for moderation and will appear after approval.

Discover more from The Shooter's Log

Subscribe now to keep reading and get access to the full archive.

Continue reading