It isn't illegal to sell a gun you have made for your own purpose.
According to my ATF agent, it is very illegal. How do you prove the difference between you made it for yourself and decided to sell it and you made it for someone else? You can't sell a firearm that you manufactured for yourself, with no serial and no records.
BTW we are talking about manufacturing a firearm, not building one from premade parts like a serialed AR lower. That is perfectly fine...because the serial has been recorded by the manufacturer of the lower. Now if you buy a blank unfinished AR lower, and do all the final machining, you can own that gun, but you can't SELL that gun.
I am referring to all the AK parts kit builds on 80% receivers or flats that people build for themselves, and then later decide to sell. My understanding is that it is perfectly legal to sell one, and it happens quite frequently.
As far as building to sell, that has to be proven by the Agency.
Going to tread lightly, as going from 5 year old memory. but yes, then if you ever sell the ak build, you need to assign a serial number to it, bubba arms "BA 12345" and city of manufacture "build" as so a FFL can then transfer / register it to new owner. Otherwise there would be 10's of thousands of "ghost" ak's out there.
googled found this:
Additional Identifying Marks
Federal law does not require a homemade gun to have an identifying marker (such as a serial number), as long as it remains in the possession of the original maker. However, if the gun is subsequently sold or otherwise transferred, it should be marked prior to its disposition. The ATF suggests that all homemade firearms be marked with a serial number as a safeguard in the event the firearm is lost or stolen, but
requires it if the gun is otherwise lawfully transferred in the future
anyway , sweet mod, wish I had your skill.