PROS or CONS: Gun Trusts and C&R Licenses

[Rekraps]

So I do not agree. The trust is the "entity" that owns the guns, and to which the guns are registered. Since there are multiple "trustees" on the trust, ownership is equally shared by all trustees, thus when I die, the guns in the trust require no action whatsoever as my son(s) are trustees also. There is no single "ownership" or registration as with an individual Form 4, unless you want to call the Trust an individual. A bit of a hassle setting up, and each time we add to the collection, all the Trustees must submit finger prints/pics, but that has been made super easy by using Silencer Shop. 

My experience has been excellent using this vehicle. 

[Bridgeport28A1]

I have a couple of questions regarding trusts. Asking for a friend...LOL

I know these are lawyer type questions but thought a member may already know the answers.

Is a NFA item that is held in a trust allowed to be transferred to an heir on a Form 5 after the trust maker dies? This is assuming there are no successor trustees.

 Trusts that I have read become irrevocable when the trust maker dies. What happens to the NFA item when the remaining trustees die and there is no one living named in the trust.

Edited March 26 by Bridgeport28A1

[ranger1385]

When I first started collecting NFA items, I used a trust because it was well known the "chief law enforcement officer" would not sign off on them.  Then two things happened.  One, they stopped that requirement.  Second, I think remember reading that you had to submit finger print cards and photos for each person on the trust.   So, with that, I just use my C&R license or a dealer.  I maintain a set of specific set of instructions for my kids just about those firearms should I croak.  

[johnsonlmg41]

5 hours ago, Bridgeport28A1 said:

I have a couple of questions regarding trusts. Asking for a friend...LOL

I know these are lawyer type questions but thought a member may already know the answers.

Is a NFA item that is held in a trust allowed to be transferred to an heir on a Form 5 after the trust maker dies? This is assuming there are no successor trustees.

 Trusts that I have read become irrevocable when the trust maker dies. What happens to the NFA item when the remaining trustees die and there is no one living named in the trust.

No, anything that is held in a trust will require a tax paid transfer to the next owner.

As to how long a trust lasts I would guess depends on how it was written?  How valid is it in other states, and can you just rewrite it as you wish, whenever you wish with no governing authority, registration, or acknowledgement or recording by any third party?    I have those same questions which is why I remain skeptical of any long term durability of a trust and potential legal challenges of validity.   You can still list firearms as assets in a trust without putting the trust as the transferee, that  way you would still be eligible for tax free transfers upon death.  As noted there are several instances where NFA registrations died along with the trust and no way to fix it. 

[Doug Quaid]

This thread pretty typical of an internet NFA trust thread from back in the trust glory days.

Here we have some nice, sober-minded people asking some intelligent questions and some nice sober-minded people answering them.

But here's the rub:  trusts might be a fantastic thing, and the people answering the questions might be smart as whip, but there is no way to verify anything.  You could wind up with a do-it-yourself trust that's perfect, or a pile of garbage and you'd never know which it is.  Or what the future holds for your $35,000 gun.

 

16 minutes ago, johnsonlmg41 said:

No, anything that is held in a trust will require a tax paid transfer to the next owner.

As to how long a trust lasts I would guess depends on how it was written?  How valid is it in other states, and can you just rewrite it as you wish, whenever you wish with no governing authority, registration, or acknowledgement or recording by any third party?    I have those same questions which is why I remain skeptical of any long term durability of a trust and potential legal challenges of validity.   You can still list firearms as assets in a trust without putting the trust as the transferee, that  way you would still be eligible for tax free transfers upon death.  As noted there are several instances where NFA registrations died along with the trust and no way to fix it. 

You're saying that the trust broke down in some way that resulted in the gun ownership getting compromised?   

Please give details.  What happened next?  ATF furnace?  Legal limbo?

 
 

[Rekraps]

10 hours ago, johnsonlmg41 said:

No, anything that is held in a trust will require a tax paid transfer to the next owner.

As to how long a trust lasts I would guess depends on how it was written?  How valid is it in other states, and can you just rewrite it as you wish, whenever you wish with no governing authority, registration, or acknowledgement or recording by any third party?    I have those same questions which is why I remain skeptical of any long term durability of a trust and potential legal challenges of validity.   You can still list firearms as assets in a trust without putting the trust as the transferee, that  way you would still be eligible for tax free transfers upon death.  As noted there are several instances where NFA registrations died along with the trust and no way to fix it. 

But, any trustee is an equal owner, thus if I die, my sons (who are trustees) still control the guns with no paperwork at all. It's only if everyone in the trust dies that the transfers become an issue. 

[Chromebolt]

A well prepared Trust should allow additional Trustees to be added