“Well, with a class II license, parts kits or machining skills, you can make you own, file the paperwork, and get the tax stamp. But then again, that would be non-transferable. The restriction on post 1986 is that they can’t be transferred.”
This is only part of the situation.
Under the NFA and more recent laws like the 1986 FOPA, the ordinary private citizen cannot legally make a full auto firearm (”machine gun”, in legal parlance and common usage), then apply for a tax stamp and get the item listed on the NFA Register. Anyone wishing to make such a firearm must first obtain the proper manufacturers’ license covering the device in question, and then obtain an authorizing letter from an approved government agency (DoD, law enforcement agencies at national, state, or local; any other agency approved by the regulatory authority) stating that the agency wants to obtain a particular firearm to evaluate for possible operational uses.
NFA registered machine guns are divided into three categories, ownership of which is progressively more restricted:
1. Fully Transferable. Allowed to be owned by anyone who has paid all applicable transfer taxes and fees, filed the proper documentation (commonly termed ATF Form 4) including passport photo and fingerprints, and obtained permission from their local chief law enforcement officer. This assumes neither state nor local law precludes possession.
2. Dealer Samples. Divided into pre-1986 and post-1986. Possession allowed only by FFL holders who have also obtained the Special Occupational Tax Stamp, commonly referred to as the “Class III” license. The difference between “pre” and “post” samples lies in permissible disposition on liquidation of the FFL holder business. “pre” samples can be somewhat more widely possessed, but this is in transition.
3. NFA registered full auto firearms transferred to approved law enforcement or other government agencies, after being produced by the manufacturer.
These rules are subject to constant revision and (worse) legal reinterpretation. Prospective buyers are urged to consult legal counsel before attempting to purchase anything. Regulatory agencies never feel themselves legally bound by previous interpretations and have no responsibility to notify NFA Device transferees of changes. And state and local laws are an entirely different matter.
Mechanically inclined forum members are admonished not to build something and then expect to obtain agency approval to continue possessing it; that way lies only huge fines and federal prison time. Full auto arms are great fun but convey no tactical advantage worth the trouble, in an individual situation.
Yes, the class II license that I spoke of is the manufactures license and is subject to all of the ATF paperwork. However, a class II license is obtainable by most US citizens.