NFA Gun Trust Lawyer Blog
A NFA Trust or Gun Trust is a type of revocable living trust that is created for the main purpose of possessing Title II firearms. In our review of many so-called Gun Trusts we have seen that most do not properly address firearms ownership, transfer and possession. (If you have a gun trust you would like reviewed, just let us know and we woudl be happy to review it under the federal laws for free) Many are regular trusts and many only have a few firearms related terms. If almost every provision in your trust does not deal with firearms, it is not a real Gun Trust from a Gun Trust Lawyer®.
A Gun Trust is a NFA Trust that is appropriate for regular firearms as well as Title II firearms (those sold by Class 3 SOT FFLs). Often times, people who wish to purchase Title II firearms with a trust choose to hire an attorney who has not studied and does not fully understand the NFA and estate planning. As a result, many so called NFA Trusts or Gun Trusts other than those provided by a Gun Trust Lawyer® do not comply with the Gun Control act of 1968, the National Firearms Act and other local and state specific gun laws. These trusts often contain several defects or mistakes and may lead to illegal possession or transfer of Title I and Title II firearms.
Mistake #1: Omitted Necessary Provisions
A generic revocable trust often times does not contain necessary provisions that are necessary for the possession of Title I or Title II firearms. A real Gun Trust should mention several provisions, including but not limited to: National Firearms Act (NFA), Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF or BATFE), ATF Form 1, Form 4, Form 5320.20, Title II firearms, prohibited persons, etc. An experienced Gun Trust Lawyer® will insert and define these terms into a Gun Trust to meet important requirements that are unique to Gun Trusts.
Mistake #2: Failure to include required provisions or execute the Gun Trust properly
Each state has its own requirements to create a valid Trust. While this is a Gun Trust it will have to be executed with the formalities required for type of trust that is used. Many states have signing requirements and these can differ depending on if the trust is revocable or irrevocable. In addition, it may be difficult for the ATF to recognize the trust as valid if one moves or the trust is attempted to be used from different states in the future. It is important to create the trust with the requirements necessary for ATF approval in each state to prevent problems in the future.
Mistake #3: The Trustee or Beneficiary is a Prohibited Person
Under the NFA, a “prohibited person” cannot own or possess any firearms. Thus, it is important that a valid Gun Trust not only mentions prohibited persons but also defines them so that future managers of the trust can easily identify illegal transfers. Your Gun Trust should make it impossible to appoint a prohibited person as a Trustee and properly deal with a beneficiary who is or later becomes a prohibited person so that you do not put your family or friends at risk or criminal prosecution. In addition, the state where the beneficiary lives at the time of your death, which is unknown at this time, must be dealt with to prevent firearms from being sent to a state where they are not legal.
Mistake #4: Title II Firearms Have Not Been Properly Transferred to the Gun Trust
A Gun Trust cannot legally own a firearm unless it is legally transferred into the trust. Simply signing a trust agreement does not transfer ownership of a firearm to a trust. A firearm must be transferred from the current owner, to the Gun Trust, according to applicable state and federal law. Opening a bank account in the name of the Gun Trust, and purchasing Title II firearms with the trust’s funds (by using a check or debit card from the Gun Trust’s checking account) is a simple way to ensure that the trust, and not you, owns the firearm(s). Your gun trust should be able to deal with the ability for you to purchase the firearms with personal funds and properly document the purchase so that invalid transfers do not take place. Our Gun Trusts come with the forms and instructions to help you properly purchase and transfer firearms to your Gun Trust. You should never use your own personal funds to purchase Title II firearms without proper documentation that it was done on behalf of you as Trustee of the Gun Trust as this can lead to the illegal possession of the firearms by co-trustees of the Gun Trust.
Mistake #5: The Gun Trust Allows a Beneficiary to Possess Title II Firearms
The majority of revocable living trusts or so called Gun Trusts allow beneficiaries and or other people to use, possess, and receive distributions of trust assets. A properly drafted Gun Trust prohibits a person who is a mere beneficiary from using or possessing a Title II Firearm. Only trustees or legally eligible authorized users under the terms of a Gun Trust have the legal right to use and possess Title II firearms owned by the trust.
The ATF changes the rules and interpretation of the NFA all the time. It is important to use a Gun Trust Lawyer® who keeps up with the changes and will not charge you every time you have a call or question regarding how to use your trust properly. Gun Trust Lawyers® will answer questions this week, next month, or next year about your trust free of charge. The unlimited support is include with your legally supported Gun Trust so you do not have to worry about future legal charges for questions or the next time ATF changes their procedure.
We have created over 5000 Gun Trusts for clients all over the country and work with lawyers in each state to have state specific issues dealt with. Today with families being located in multiple states and not knowing where your beneficiaries will live when you die, it is more important than ever to have your Gun Trust deal with multi state issues correctly. To find out more about Gun Trusts request information using our contact us form on this page or call us to begin the process.