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SamSung
09-03-2010, 6:19 PM
Where will be the best place for DROS, meaning good price and no hidden charges, I am planning to buy a handgun from Centerfire

deadlyapp
09-03-2010, 6:47 PM
Probably a local FFL that works out of their house. They're more likely to offer you a better price than a dealer

OneSevenDeuce
09-03-2010, 6:48 PM
DROS is 25 dollars no matter the location.

EDIT: I think you mean what will be a good place to do an FFL xfer? I agree with above. There is a guy here in San Diego who does it for $40. Cheapest place in the county. Everywhere else is between 75-125 dollars because they want you to buy the gun from them instead.

jtmkinsd
09-03-2010, 11:56 PM
Where will be the best place for DROS, meaning good price and no hidden charges, I am planning to buy a handgun from Centerfire

There are two seperate charges to any firearm transfer. The dealer transfer fee (this charge is set by the dealer and can be whatever he/she wants) and the DROS fee ($25 State mandated fee)

Now, some dealers will waive the transfer fee if you buy a gun from their inventory, some won't. Generally, transfer-only dealers tend to have lower dealer transfer fees because they deal in volume, so they want to attract customers with low prices.

BE AWARE...some FFLs will tell you the DROS fee is something more than $25....but they are adding a "dealer fee" to the State mandated $25 fee.

CA law requires conspicuous signage showing the break-down of DROS fees so look for that wherever you go. Also, when you call around to find a local FFL and ask how much they charge, whatever figure they give you, make sure you ask if that includes the DROS fee.

Plisk
09-04-2010, 3:47 AM
You're location says you're in Orange County correct?

Give us at Ade's a consideration. Our transfer fees are $60 plus the $25 for DROS like any other purchase. No hidden fees here, the only addition you may run into is the need of a gun-lock depending on what it is you purchase.

www.adesgunshop.com

deadlyapp
09-04-2010, 4:14 AM
You're location says you're in Orange County correct?

Give us at Ade's a consideration. Our transfer fees are $60 plus the $25 for DROS like any other purchase. No hidden fees here, the only addition you may run into is the need of a gun-lock depending on what it is you purchase.

www.adesgunshop.com

I know its offtopic and I'm not trying to attack you here, but how do you FFL's get away with charging such an exorbitant amount of money for a transfer? I can go to about 20 different places near me in washington state that will do a transfer for $20 and some even less than that. That includes the NICS check and all paperwork to submit to the ATF or to the state (in the case of a handgun purchase)

Plisk
09-04-2010, 5:14 AM
I know its offtopic and I'm not trying to attack you here, but how do you FFL's get away with charging such an exorbitant amount of money for a transfer? I can go to about 20 different places near me in washington state that will do a transfer for $20 and some even less than that. That includes the NICS check and all paperwork to submit to the ATF or to the state (in the case of a handgun purchase)

That's the whole reason. It's an entirely different state, with a different set of laws.

Transfers in California require a lot more work and attention. That's more hours that employees have to send handling them.

deadlyapp
09-04-2010, 5:38 AM
That's the whole reason. It's an entirely different state, with a different set of laws.

Transfers in California require a lot more work and attention. That's more hours that employees have to send handling them.

Do they really though? You've got the DROS paperwork, of which I assume there are several copies, one for the FFL, one customer, and one gets sent into the state. There is the ATF paperwork, which is used for the NCIS check. But otherwise, what else is there? Paperwork gets checked out prior to the customer leaving the first time, the NCIS check takes 5 minutes maximum if it is clear.

Again, not being combative, I'm just curious as to what the actual differences end up being.

nn3453
09-04-2010, 6:09 AM
I keep posting this over and over, don't forget to factor in CA tax. Dealers MUST collect this on out of state transfers. The ones who aren't are being shown the errors of their ways during an audit.

Disclaimer: I am not affiliated with any gun store in any way. I just don't want to see the guys who are not charging state tax get harassed during an audit.

Plisk
09-04-2010, 6:17 AM
I keep posting this over and over, don't forget to factor in CA tax. Dealers MUST collect this on out of state transfers. The ones who aren't are being shown the errors of their ways during an audit.

Disclaimer: I am not affiliated with any gun store in any way. I just don't want to see the guys who are not charging state tax get harassed during an audit.

I've heard people say this before. Where does it say we have to? DOJ, ATF, and our accountant have never told us this. It doesn't make sense that we do. We aren't selling them the product, we are providing a service. There are no taxes on a service.

Plisk
09-04-2010, 6:20 AM
Do they really though? You've got the DROS paperwork, of which I assume there are several copies, one for the FFL, one customer, and one gets sent into the state. There is the ATF paperwork, which is used for the NCIS check. But otherwise, what else is there? Paperwork gets checked out prior to the customer leaving the first time, the NCIS check takes 5 minutes maximum if it is clear.

Again, not being combative, I'm just curious as to what the actual differences end up being.

You have to take an employee away from the counter to open, check in, label and store all incoming firearms. Then you have storage until the buyer shows up, then another 10-30 days of storage after the DROS, combined with the roughly 20-30 minutes to DROS it.

Combined with 8-12 firearms arriving everyday, it adds up to a lot of work.

nn3453
09-04-2010, 6:20 AM
I've heard people say this before. Where does it say we have to? DOJ, ATF, and our accountant have never told us this. It doesn't make sense that we do. We aren't selling them the product, we are providing a service. There are no taxes on a service.

It might come down to the state going after dealers instead of the end consumer who is to supposed to report it as "use tax." No one does, so the state must think it is easier to go after the dealers.

Perhaps CGF should try to get some clarification on this or try to get it struck down if it is some underground DOJ crap. I'm only reporting what I heard from two store owners who were recently audited and told this (by their DOJ rep I assume).

Plisk
09-04-2010, 6:25 AM
It might come down to the state going after dealers instead of the end consumer who is to supposed to report it as "use tax." No one does, so the state must think it is easier to go after the dealers.

Perhaps CGF should try to get some clarification on this or try to get it struck down if it is some underground DOJ crap. I'm only reporting what I heard from two store owners who were recently audited and told this (by their DOJ rep I assume).

What dealers are they going after? Ade ran his shop for upward of 12 years and he's never had to deal with it before. Even with the change in ownership and fresh new set of audits it's never come up before.

Perhaps you should provide some clarification on this since you're the one posting it.

halifax
09-04-2010, 6:47 AM
I've heard people say this before. Where does it say we have to? DOJ, ATF, and our accountant have never told us this. It doesn't make sense that we do. We aren't selling them the product, we are providing a service. There are no taxes on a service.


The Board of Equilization (BOE), not the ATF or DOJ, controls the issuance and revocation of your sellers permit. This is what they say:

Revenue and Taxation Code Section 6007 defines a “retail sale” to mean a sale for any purpose other than resale in the regular course of business in the form of tangible personal property.
When tangible personal property is delivered by an owner or former owner thereof, or by a factor or agent of that owner, former owner or factor to a consumer or to a person for redelivery to a consumer, pursuant to a retail sale made by a retailer not engaged in business in this state, the person making the delivery shall be deemed the retailer of that property. He or she shall include the retail selling price of the property in his or her gross receipts or sales price.


495.0843 Deliveries by California Firearm Dealers for Out-of-State Retailers. California residents order firearms from out-of-state retailers and the retailers ship the firearms to an authorized California firearm dealer for delivery to the customer. The California firearm dealer charges a fee to register each firearm in California. When the California firearm dealer completes the registration paperwork and delivers a firearm to a California purchaser for an out-of-state retailer not registered with the Board as a retailer engaged in business in this state, it is presumed that the firearm dealer is the retailer of the firearm under the second paragraph of section 6007. In such a case, the firearm dealer would owe sales tax on the total amount of the retail sales price of the gun to the customer, including the Department of Justice fee if passed on to the customer, and including any service charge made by the firearm dealer.

If the firearm dealer establishes to the satisfaction of the Board that the out-of-state retailer was engaged in business in this state under section 6203, its deliveries for that retailer will not be considered taxable retail sales by the firearm dealer, even if the out-of- state retailer has not registered with the Board as a retailer engaged in business in this state. In such cases, as well as in situations in which the retailer is in fact registered as a retailer engaged in business in this state, the out-of-state retailer has a duty to collect the use tax under section 6203. The retailer should collect use tax on the invoice price of the firearm, plus the service fee, even if paid directly to the firearm dealer by the customer. Also, the Department of Justice fee passed onto the customer should be included in the measure of tax. 12/7/95. (Am. 99–2).
(Note: On and after January 1, 1999, the Department of Justice fee is not includible in the measure of tax, but all other charges remain subject to tax.)


I know of no specific cases where a dealer has been hit with the back taxes but that doesn't mean that the necessary language doesn't already exist to do so. Revocation of a dealer's Sellers Permit would effectively close the shop since the permit is required for listing on the CFD.

I suppose a CA dealer could argue this point:

If the firearm dealer establishes to the satisfaction of the Board that the out-of-state retailer was engaged in business in this state under section 6203, its deliveries for that retailer will not be considered taxable retail sales by the firearm dealer, even if the out-of- state retailer has not registered with the Board as a retailer engaged in business in this state.

saying that the out-of-state retailer accepted a sale from CA and sent the merchandise to a CA address; therefore they are in-fact engaged in business in CA and are the ones responsible for collecting and remitting the CA tax.

OneSevenDeuce
09-04-2010, 6:51 AM
I know its offtopic and I'm not trying to attack you here, but how do you FFL's get away with charging such an exorbitant amount of money for a transfer? I can go to about 20 different places near me in washington state that will do a transfer for $20 and some even less than that. That includes the NICS check and all paperwork to submit to the ATF or to the state (in the case of a handgun purchase)

The fees he mentioned are actually pretty good for an FFL xfer. Here in SoCal the fees can get horrible. Theirs is definitely lower than average for these parts.

Plisk
09-04-2010, 7:32 AM
That's interesting.

On the last part, I don't know of any dealer (or retailer for that matter) in CA that would sell and ship to another CA dealer without charging tax to the buyer. It's the out-of-state one that have this issue.

I understand how the law says that we are technically "selling" it to them, being as we are the means of them acquiring the merchandise. But, it would be another lovely loop to jump through in paperwork to determine the sales price of every item sent in to us, and charge more on top of that.

halifax
09-04-2010, 8:37 AM
That's interesting.

I understand how the law says that we are technically "selling" it to them, being as we are the means of them acquiring the merchandise. But, it would be another lovely loop to jump through in paperwork to determine the sales price of every item sent in to us, and charge more on top of that.

I don't think the BOE cares about that.

nn3453
09-04-2010, 9:30 AM
Thanks halifax for providing the clarification. The guy who works at Ades, please PM me if you want contact info/names of specific FFLs I talked to about this so you can verify it from the horses mouth, since you seem to doubt my statement.

nn3453
09-04-2010, 9:33 AM
I don't think the BOE cares about that.

+1

I've been told by tranferring FFLs that items sent from out of state must include an invoice for their records.

jtmkinsd
09-04-2010, 11:07 AM
+1

I've been told by tranferring FFLs that items sent from out of state must include an invoice for their records.

I'm guessing that's only if they are collecting tax on the item. We don't collect tax so the invoice is not needed/required. The only paperwork we require to come with the firearm is a copy of the sender's FFL and a CA shipping approval

Blackhawk556
09-04-2010, 11:29 AM
When i was looking for a FFL last month to accept a transfer from Budsgunshop.com, i called around several stores here in fresno and asked about their fees.

Here are the answers i got from different dealers:

1. $60 includes background check and their transfer fee. "IF" an invoice is included in the box they will have to charge me sales tax

2. $85 for transfer and DROS. no tax

3. $90 for transfer and DROS. "BoE requires that we collect sales tax"

guess which one I picked to do my transfer??

Numero dos :)

morfeeis
09-04-2010, 12:47 PM
long guns $45 handguns $50 and i love my FFL www.safespaceshooting.com

and yes you do have to pay tax.......

Plisk
09-04-2010, 4:07 PM
Thanks halifax for providing the clarification. The guy who works at Ades, please PM me if you want contact info/names of specific FFLs I talked to about this so you can verify it from the horses mouth, since you seem to doubt my statement.

I did some poking around today with some of the other dealers I know, and a few of them confirmed it. So I do believe you, its just we've never been told we have to, so it's never been an issue with us.

dslo
09-06-2010, 5:05 AM
Hey all!, I just purchased my first firearm this week and was looking for info on DROS when I found this thread and thought id chime in :)

..... its just we've never been told we have to, so it's never been an issue with us.

I'm pretty sure they make tax laws and policies as vague and confusing as possible so regular joes will require an accountant or tax advisor. In your case you may want to look for a new accountant asap! Your not alone however, many very large organizations make this mistake every day.

the ATF and DOJ aren't in the least bit responsible for your tax obligations. BOE/Judges will both tell you "ignorance is not an excuse" and you will be on the hook for all past taxes, though often minus penalties if it is out of your payment period. It would be nice of them to let it slide, but then every business would operate that way until they "learn" otherwise.

One of the distributors for my business just got nailed hard for this. If my retail store had the distributor send out a "drop shipment" (from the distributor to the end user without coming to me first) to a customer, they would typically add a handling fee only and rely on the retail store to collect the payment and tax. But when the distributor is the final stop to customer they assume the role of the retailer and are responsible for collecting the sales tax in the customers tax jurisdiction. This makes for many headaches because the distributor rarely knows the selling price that his retail clients are selling the product to the end user for.


It might come down to the state going after dealers instead of the end consumer who is to supposed to report it as "use tax."

Like you mentioned, the use tax is paid by the end consumer who purchases the product for use. the catch is that in most jurisdictions they list resale and "casual sales" as exemptions to out of state use tax payment. In most cases the "casual sales" exemption is geared for yard sales and private auction type events...ie non-regular and non-recurring sales. This allows your kids to sell lemonade with no sellers permit.