What is a Class 2 SOT?
The Class 2 Special Occupational Taxpayer (SOT) license is for Federal Firearms License (FFL) holders in the United States, allowing them to manufacture and deal in firearms under the National Firearms Act (NFA). This status is essential for expanding a firearms business into the specialized domain of NFA firearms while ensuring compliance with federal law and prioritizing public safety.
Types of NFA Firearms under Class 2 SOT
Class 2 SOT holders have the authority to manufacture and deal in various NFA items, each with unique characteristics and regulations.
Machine Guns and Full-Auto Firearms
Machine guns and fully-auto firearms fire multiple rounds with a single trigger pull, making them one of the most tightly regulated categories. Class 2 SOT holders can manufacture these firearms but must follow certain rules regarding their production.
Short-Barreled Rifles (SBRs)
A short-barreled rifle has a barrel less than 16 inches in length, making it compact and easy to conceal. Class 2 SOT licensees can produce and distribute SBRs, but the firearm dealer is required to follow specific procedures during their production.
Short-Barreled Shotguns (SBSs)
A short-barreled shotgun is a firearm with a barrel shorter than 18 inches or an overall length less than 26 inches. These weapons are highly regulated due to their portability and potential for concealment.
Destructive Devices
Destructive devices cover a wide range of items – explosives, grenades, and firearms with a bore diameter greater than 1/2 inch. They are highly regulated due to their potential for significant harm.
Any Other Weapon (AOW)
The AOW category includes concealable firearms or devices other than pistols or revolvers.
Applying for a Class 2 SOT
Step 1
Before applying for a Class 2 SOT, Federal Firearm License holders must have a specific FFL license – Type 07 FFL. This license allows dealers to manufacture firearms.
If you don’t already have this license, complete the ATF Form 7 and submit it to the ATF.
Step 2
The next step is submitting the completed application (ATF Form 5630.7) and paying the associated tax stamp. The SOT tax ranges from $500 to $1,000, depending on the type of license you need and the sales volume of your firearms business.
Step 3
As part of the application process, all responsible persons must pass a thorough background check conducted by law enforcement. This involves submitting fingerprint cards and verifying that the information on your application is complete and accurate. Background checks verify that applicants can responsibly handle Title II (NFA) firearms in accordance with federal law.
FastBound’s Role in Streamlining Procedures
FastBound’s industry-leading solutions help current FFLs manage their operations efficiently while ensuring strict adherence to federal, state, and local firearm regulations. With features like automated A&D tracking, digital ATF Form 4473 with digital signature support, and multi-state background checks, FastBound provides the tools FFL dealers need to navigate the intricate requirements of the NFA.
By streamlining compliance procedures, FastBound allows FFL holders to focus on expanding their firearm business while meeting the highest legal standards. We help you stay compliant and competitive in the firearms industry.
Ready to Streamline Your Compliance and Focus on Growth?
Start Your Free Trial with FastBound Today
Try for Free!