With all the knowledge and real world experience here I thought it would be interesting to hear about lessons learned +/- regarding Firearms business types and structures.

Some examples to kick things off below, but please feel free to jump in with any/all personal experiences and thoughts both current or in retrospect on the subject.

Sole Proprietor vs. LLC vs. Corp

LLC/Corp registered in your home state or out of state

One LLC/Corp or structure multiple as Parent and child

sole prop = several disadvantages, starting with more liability, plus your personal collection now becomes part of your FFL, and every gun you own is now subject to ATF review.   Big advantage of sole prop is you get to keep non-MG NFA stuff you acquire if you have SOT, then give it up.   You can keep it with LLC, but you have to keep paying your state every year to keep your LLC alive.   Unless you have some big plans/other issues, the other options aren't really worth the trouble and expense.

LLC = continuity of operations because you can put multiple people on it as members, which is important if you are a manufacturer of post-sample MG's so they can be legally sold as part of the process to close the business.  If the primary worker (e.g. husband) passes away, the wife can shut the business down cleanly.  Make sure to leave a list of trusted people who can help.

 
It's not a matter of more or less liability (because the liability is the same) but whether the owner of the business has legal protections for his personal assets under state law. Typically an SP doesn't have any. An LLC or corporation may offer some protections, but that isn't ironclad. The reason is many small businesses fail to keep business from personal and in lawyer speak that's called "piercing the corporate veil". You use your company credit card to buy groceries, use your personal credit card to buy a case of ammo....a plaintiffs attorney will use that to show that you and your business are not actually separate entities. See How to avoid piercing the corporate veil




Nonsense.
Whether your gun business is an SP, Partnership, LLC or Corporation......ATF regs are the same. ATF wants the licensee to tag personally owned firearms, whether individually or an entire warehouse.
See PERSONAL FIREARMS AND YOUR FFL BUSINESS SITE
and
Personal Collections-Licensees

So If you operate as a LLC and ensure that you don't mix business with personal....separate bank account, mailing address, credit card etc and don't pierce the corporate vail then your personal assets would not be legal game if someone were to bring a lawsuit against you.

This is in legal theory/on paper, but at the end of the day still provides that paper theory in comparison to the sole proprietorship or partnership which offers absolutely nothing in the way of personal asset protections.

This makes sense, but unlike major corporations with their own attorneys and deep pockets what would happen to a small business LLC if and when the court comes to the conclusion that the only real assets you have to pursue are personal. Will the LLC truly stand up in a court of law and offer that kind of protection so long as you haven't "pierced the corp veil"?

Thank you