Do I Need Firearms Planning?
Many gun owners may not be aware that they need to make special plans for what happens to their firearms after their death. Depending on the type of weapon you own, you may need to consider a “gun trust” to administer these firearms in a way that will avoid legal consequences for your loved ones after your death.
The National Firearms Act (NFA) regulates the possession, use, and transfer of several different types of what are called “Title II” weapons. These include machine guns, short-barrel rifles and shotguns, suppressors, destructive devices, and Any Other Weapons (AOWs).
Under the NFA there are two ways to acquire Title II weapons: individually or through an entity. In 2016, ATF published Rule 41F which requires individuals AND “responsible persons” of an entity to provide fingerprints, a photograph, and to undergo a background check with an application to transfer an NFA firearm, in addition to paying the required $200 application fee/tax ($5.00 for an AOW). Notice of the application is provided to the Chief Law Enforcement Officer (CLEO) in the jurisdiction in which the applicant resides.
Individual ownership is not the best way to own Title II (NFA) firearms. Only the person whose name the weapon is registered to will be entitled to use the items. If the person is an individual, then that individual must be with the NFA firearm at all times. An “unauthorized transfer” is broadly defined, and depending on the circumstances, could include handing a Title II weapon to a friend at the firing range or even allowing a spouse to have the combination of the safe where the Title II weapons are stored.
A trust is defined as a person under Title II. If you create a trust as the “grantor”, you generally serve as a trustee and can appoint one or more co-trustees. Under federal law, a trustee has the right to possess Title II firearms owned by the trust. Therefore, in order to avoid a potential federal felony charge possibly resulting in a 10 year sentence and, $250,000 fine makes using a gun trust a smart move.
Our goal is to protect you, everyone you love, and everything you own… including your gun collection!
There are several advantages to using an entity to purchase and hold ALL firearms you own:
- Providing written instructions about lawful possession of firearms
- Appointing specific people to handle firearms if you are incapacitated or should die
- Making certain that your firearms go to the RIGHT PEOPLE.
Gun trusts have several advantages over LLCs and corporations with respect to firearms planning. In contrast to these entities, a trust is not subject to state fees. Because trusts are primarily an estate-planning tool, they are designed to hold, share, and distribute assets; they are easy to customize to carry out your goals.
Typically, a firearms collection is the product of one spouse’s interest. The other spouse tolerates this interest, but does not care nearly as much about the items that have been accumulated. Due to death or disability, the disinterested spouse or other family member may be forced to manage and/or distribute the collection. Because of the vast amount of federal and state regulations pertaining to both NFA and non-NFA weapons, a disinterested spouse may make a mistake as to the applicable laws. A violation of the applicable laws usually results in the commission of a felony.
Because a gun trust is designed with this scenario in mind, there are detailed instructions to guide a trustee in handling the assets as well as an overview of applicable laws and regulations.
A gun trust is also designed to allow for multiple users of the items held by the trust. This is in direct contrast to a standard/generic revocable living trust. Gun trusts specifically allows for any named trustee, successor trustee, and any named beneficiary to have the ability to use the trust assets. There is even a provision that will deem any person that you are shooting with a beneficiary of the trust. The trust also allows for the formal appointment of beneficiaries for a limited duration with a set expiration date.
A gun trust has many standard trust features such as avoiding the probate process for your firearms and the public record that it would create. There is also the ability to create and update a tangible personal property memorandum which grants different people specific items of a collection.
If you have any questions or would like to learn more about how a gun trust could benefit you and your family, please do not hesitate to contact Alperin Law.