Legal Question in Business Law in California

Ammo Business

With the recent spike in gun ammunition I'm interested in joining the marketplace. I want to sell gun ammunition online from my home. I will buy the ammunition cheap and resell it for a profit. However, I don't feel safe doing so as a sole proprietorship. I want to form an LLC taxed as a sole proprietorship, to insulate myself from potential liability.

In addition for all the sales that I make I will require the buyer to scan and email a document saying that they aren't a criminal and a government issued photo ID to verify that they are over 18.

What type of liability insurance would I need? (I would be the sole owner/worker operating from my home) Would I need an umbrella policy?

On a side note, I have already purchased some inventory in my personal name and not the name of the potential LLC would this in it self pierce the veil? How could I give this to the LLC without piercing the veil? Could I sell this to the LLC with some document? This would be a one time occurrence and in the future I would be sure to open a company bank account and credit card, I just want to stay away from commingling. Should the inventory be sent back and repurchased under the company's bank account? Am I missing anything else?


Asked on 4/02/09, 12:06 pm

1 Answer from Attorneys
Terry A. Nelson Nelson & Lawless

Re: Ammo Business

Missing something? Duh. You haven't even asked the right questions yet. You will have to comply with all the federal BATFE and Calif DOJ licensing requirements for selling ammunition, and all the local, state and federal rules on records keeping, business licensing, zoning conditions, explosives storage, inventory security protections, shipping agreements, etc. Tell me you didn't think you could just casually wander into the firearms business, did you? Now, if you get serious about doing this and avoiding jail time, feel free to contact me for the substantial legal and business help you're going to need.

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Answered on 4/02/09, 1:50 pm


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