Following is a discussion of how a person can build and own a
compact AR-15 in the form of an AR-15 pistol, Short Barreled Rifle
(SBR), or Any Other Weapon (AOW) and some of the advantages and
disadvantages of each. A good reference to review before
reading any further is
Pre OR Post Ban:
More than a serial number on AR15.com. In review of the material at the link above, weapons built before
the Clinton Ban came into effect had characteristics that are now
prohibited by the Crime bill by the definitions listed. These
definitions have created challenges for AR-15 owners that need to be
addressed in order to make a post Crime Bill legal AR-15 pistol.
The POST BAN AR-15 Pistol

The key to building a post ban AR-15 pistol is to find a way
around the crime bill, then buy yourself a new stripped AR-15 lower
and build the pistol in a way that the crime bill does not apply to
your pistol. To do this, it is essential to understand the
definition of a Semi Automatic Assault Pistol as the crime bill
defines it:
A Semi-Auto pistol with an ability to accept a detachable
magazine can not have two (2) or more of the following features:
- an ammunition magazine that attaches to the pistol outside of the pistol grip.
- a threaded barrel capable of accepting a barrel extender, flash suppressor, forward handgrip or silencer.
- a shroud that is attached to, or partially or completely encircles the barrel and that permits the shooter to hold the firearm with the non-trigger hand without being burned.
- a manufactured weight of 50 ounces or more when the pistol is unloaded.
a semiautomatic version of an automatic firearm.
Over the years I have thought of three ways around these rules.
The Short Barreled Rifle AR-15

Bishop's Micro-Car
The second option you have in regards to an AR-15 pistol is to build a
Short Barreled Rifle (SBR) AR-15. Once the lower is registered as a SBR
you can then remove the stock and replace it with a pistol buffer
and your short 7-inch upper and use it in a PISTOL configuration or
keep the stock! With a pre-ban lower you can use it as a pre-ban
short barreled rifle including the flash suppressor, bayonet lug,
etc. If you use a POST BAN AR-15 and register it as a SBR, you have a number of shortcomings including the fact that you can not use a bayonet lug, flash
suppressor, or collapsible stock BUT there is no reason that you can not still use it in a PISTOL configuration! Because this is a SBR
and NOT a pistol, the SAW laws do not apply as they would to a post
ban Semi Auto Pistol as far as detachable magazine and pistol
weight. NOTE: I am
confirming these understandings with the ATF!!!
The AR-15 Any Other Weapon (AOW)

The AOW is a unique category for the AR-15 as the AR-15 will have a forward and rear pistol grip. An AOW is
defined to be
"...any weapon or device capable of being concealed on the person from which a shot can be discharged through the energy of an explosive, a pistol or revolver having a smooth bore designed or redesigned to fire a fixed shotgun shell, weapons with combination shotgun and rifle barrels 12" or more, less than 18" in length, from which only a single discharge can be made from either barrel without manual reloading, and shall include any weapon which may be readily restored to fire. Such term shall not include a pistol or revolver having a rifled bore, or rifled bores, or weapons designed, made or intended to be fired from the shoulder and not capable of firing fixed ammunition." 26 USC
sec. 5845(e). The ATF has made the decision that a handgun with more than one grip is an AOW based on the gun a) being concealable and b) not meeting the definition of a "pistol" in the regulations promulgated under the NFA, since they say a pistol has a single grip at an angle to the bore. However, at least one federal court has decided that if the grip is added later, the gun is not "originally designed" to be fired by holding in more than one grip, and thus putting a second grip on a pistol does not make it an AOW.
So with a fundamental appreciation of the definitions above all
one needs to do to build a AR-15 AOW is to buy a stripped lower to
use. It is important to remember that an AOW can not have and must never
have had a stock attached to it! Then simply fill out the
appropriate ATF and FBI paperwork and send it to the ATF for
approval. When the paperwork returns with your NFA tax stamp
the AOW can be built. To build an AOW, you need to add a
pistol buffer and a pistol upper with a forward vertical grip. In addition, the forward pistol grip must be attached in a way that tools would be required for it's removal to prevent the AOW from being considered a pistol or Short Barreled Rifle (SBR). An AOW has one big advantage as the crime bill does not apply to AOWs! In such, you can buy a stripped post ban lower and build it with a flash
suppressor, bayonet lug, removable magazine, etc.
NOTE: I am confirming these
understandings with the ATF!!!
Final Review & Conclusions
The AOW and SBR route both require ATF and FBI paperwork and
NFA taxes. The SBR comes with a $200 manufacture or transfer
tax while an AOW has a $200 manufacture cost and a $5 transfer tax.
Accordingly, if you can have your local C-2 manufacturer build and register an AR-15 AOW
and then transfer it to you for a $5 transfer. If you do it yourself
it's a $200 tax.
You do not need to work with a C-2/C-3 dealer to do either of these conversions... Just sent the ATF and FBI your prints, pictures, and application and
wait a few months until the papers come back! I do not know how much a C2/C3 dealer would charge to register a lower as an AOW
and then transfer it to you.
For me, I would prefer to go the SBR route with a pre-ban lower as it allows a lower to be used as a pre-ban
rifle, a SBR (i.e. 14.5-inch M4 Carbine or shorter), a pre-ban AR-15 pistol, a AOW, or just about anything else.
An AOW can only be an AOW, i.e. it can not be used as a pistol or as a rifle or
carbine. The Post Ban pistols have their advantages as they eliminate the
ATF National Firearms Act but they lack the real character of the AR-15 system
due to the characteristics that must be eliminated to make the pistol into a
form that the crime bill doesn't apply.