ATF

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Bureau of Alcohol, Tobacco, Firearms and Explosives

What if I change my business structure?

A change to the business structure may result in a new entity, thus creating a need for a new FFL, a new special tax liability, and a transfer of any inventory of NFA firearms. For example, a change from operating as a sole proprietor to an LLC incurs special tax liability for the LLC. The change will also require that any NFA firearms to be used in the LLC business must be transferred to the LLC from the sole proprietorship. Both the sole proprietorship and the LLC must be special taxpayers for the same Tax Year in order for the transfer of the NFA firearms to be made tax exempt on Form 3.