NFA Gun Trusts
Certain guns and accessories are regulated by the National Firearms Act (“NFA”). They are sometimes referred to as Title II firearms, and include fully automatic and select fire weapons, short-barreled rifles and shotguns and silencers.
It can also include items you don’t expect. A .22 Derringer is a common pistol, but paired with a wallet holster becomes an NFA weapon.
NFA firearms can be lawfully owned as long as they are permitted under state law and Missouri allows ownership. However, you must 1) pay a $200 tax; 2) obtain consent from the Chief Law Enforcement Officer (or “CLEO”). Many CLEO’s are reluctant or refuse to sign the consent for various reasons, including fear of potential liability. If the CLEO refuses to sign, there is virtually no recourse.
An NFA Gun Trust gives you a significant advantage in obtaining an NFA firearm, because you don’t have to get the consent of the CLEO. No local approval is required, so you can often obtain the firearm more quickly with an NFA Gun Trust.
An NFA Gun Trust also allows for easier and more private transfer of NFA firearms and any guns to your family members if you die or become disabled. That is because assets in a trust pass directly to your beneficiaries outside of probate.
Why Not Simply Create an “Ordinary” Trust?
Ordinary estate planning trusts should not be used to acquire and hold NFA firearms because they do not contain special provisions that deal with firearms. For example, ordinary trusts do not give the trustee the powers needed to deal with NFA weapons and with the Bureau of Alcohol, Tobacco and Firearms Enforcement (“BATFE”). The trustee must also determine whether a beneficiary is a “disqualified person” under state and federal law and which laws apply.
Running afoul of the NFA can subject you to fines of up to $250,000 and 10 years in prison. The weapons must also be forfeited. With an NFA Gun Trust, the trustee receives instruction in the terms of the trust to avoid violating the NFA.
Under federal law, an NFA firearm can never be handled or transported by anyone other than the registered owner. Many owners of NFA firearms don’t realize they are breaking the law every time they allow someone other than them to handle the weapon. With an NFA Gun Trust, the firearms can be used by any trustee of the trust. Anyone who is a trustee can legally handle or transport the firearms and trustees can be added or resign at any time.
When you pass away, firearms ordinarily become part of your probate estate and are dealt with by the probate court. With an NFA Gun Trust, you not only can avoid probate, but you can keep your privacy intact because there is no probate estate to be opened.
In the past, some people have used corporations and LLCs to acquire NFA firearms. However, you have ongoing fees and tax returns to file with this method. It’s expensive and overly complicated. After you have created an NFA Gun Trust, there are no additional fees, and unlike a corporation or LLC, a trust is completely private.
Gun Trusts as Part of a Broader Estate Plan
When you’re putting NFA gun trusts into place – in order to protect your interests and to make their transfer far easier for your loved ones in the event of your death – it’s important to revisit your estate planning needs more broadly. Far too often, individuals approach their estate plans in a piecemeal fashion. Create NFA gun trusts as needed. Name a potential guardian once one has kids. Craft an advance healthcare directive once one has been diagnosed with a serious medical condition.
While there is nothing “wrong” with navigating the estate planning process one piece at a time, working with Legacy Law Center to successfully manage your broader estate plan will allow you the peace of mind that accompanies knowing that “your affairs are in order” at all times. Here are some of the top considerations that we ask our clients to consider as they work towards a fully-realized estate plan:
One: Digital Assets
How many accounts do you maintain online that require a password? Once you’re gone, someone is going to need to access these accounts in order to maintain them, retrieve information and/or assets from them, and/or shut them down. Have you given any thought as to who you might entrust this responsibility to? Have you given any thought as to who you want to deny access to your accounts? Crafting a digital estate planning strategy will help to ensure that your online presence is managed according to your wishes after your death.
Two: Kids and Pets
If you have minor children and/or pets, you’ll need to make some decisions concerning who should be entrusted with their care in the event of your death or incapacitation. If you’re in a position to provide for your kids or pets financially after your death, you’ll want to think carefully about how to manage your available assets. Our firm can help you navigate these challenging legal issues successfully.
Three: Probate
Most wills are subjected to the probate process in Missouri. This process can be time-consuming, stressful, and potentially stressful for loved ones who are forced to deal with it. As a result, you may want to consider transferring some or all of your non-firearms assets via a traditional trust. Assets that are transferred via trust aren’t subject to the probate process.
Four: Healthcare Considerations
Estate planning doesn’t only concern what happens to someone’s assets in the event of their death. A sufficient estate plan also addresses the kinds of medical care one does and doesn’t wish to receive in the event that they are incapacitated by illness or injury and are unable to communicate those wishes for themselves.
Five: Special Needs
The experienced legal team at Legacy Law Center can assist you with all of your straightforward estate planning needs. However, we can also assist you with special needs that may not be as straightforward. Just as we can assist you with creating NFA gun trusts, we can help you to manage small business assets, trusts for adult children who aren’t legally independent, transfer of intellectual property, etc.
How can Legacy Law Center help?
Our firm can advise you whether an NFA Gun Trust is right for you and will draft all of the trust documents, assists you with signing them and can even assist with the federal paperwork for obtaining the NFA weapon of your choice.
