When dealers talk about their FFL, most are holding a Type 01 — the standard dealer license. Type 07 is less common but comes up frequently when dealers want to expand into manufacturing or NFA work. Understanding the difference matters for compliance and for planning your business.

Type 01 — Dealer in Firearms Other Than Destructive Devices

The Type 01 is the standard retail dealer license. It allows you to buy and sell firearms, conduct transfers, accept firearms for consignment, and engage in the full range of retail firearms commerce. The Type 01 does not authorize manufacturing or the manufacture of NFA items.

Most gun stores — storefronts, home-based dealers, pawnbrokers who deal in firearms — operate under a Type 01. The annual license fee is $200 for the initial application and $90 for renewals.

Type 07 — Manufacturer of Firearms Other Than Destructive Devices

The Type 07 authorizes manufacturing in addition to dealing. A Type 07 can do everything a Type 01 can do — buy, sell, transfer — plus manufacture firearms for sale. If you build rifles, assemble pistols from parts, or produce any firearm for commercial sale, you need a Type 07.

The Type 07 also opens the door to SOT (Special Occupational Taxpayer) status, which allows manufacturers to work with NFA items. A Type 07 with SOT can manufacture NFA items like suppressors and machine guns for sale to dealers and government agencies.

Compliance Differences

Both license types require the same Form 4473 and bound book compliance for over-the-counter transfers. Type 07 dealers also have manufacturing records requirements — every firearm manufactured must be logged with a serial number, make, model, caliber, and type before it leaves the manufacturing process.

Type 07 compliance is more complex. Manufacturing records, disposition of manufactured firearms, and SOT obligations layer on top of standard dealer requirements. The Form 4473 process is identical for both — but a Type 07 audit covers more ground.

When to Consider Upgrading

If you're building firearms for sale — even as a secondary business — you need a Type 07. Operating as a Type 01 while manufacturing firearms for commercial sale is a federal violation. The upgrade cost is modest; the compliance exposure for operating without the right license is not.

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