Gun Trust?

[The Ghost]

To my knowledge to own an Ar with a stock and barrel less than 16" you need a tax stamp or have a gun trust. How does the gun trust work? Do you still need to register it with the ATF if you go with the gun trust?

Thanks for the help!

[FJ540]

You need a tax stamp regardless of having a trust or not. The trust allows additional benefits in that you may add trustees to the trust and any of them may be in possession of the weapon. It also helps with estate planning, as you wouldn't have to file again and get permission to own the NFA item if it's original owner became room temp.

[Hmac]

Trust vs individual - paperwork still has to be sent, fee paid, and stamp received...and it will still take 6-7 months to get the stamp. You do it using the same forms (Form 1 or Form 4 depending on whether you're building it or buying it). The difference is that with a trust, it's the corporation or trust that is applying instead of an individual. So, you'd need to set up the trust first. Although it can be done using online or home software, you'd want to weigh that against actually having a lawyer do it for about $500. The advantage to a trust is that you don't need to have the CLEO sign off , you don't need fingerprints, and anyone named as a trustee of your trust can have possession of the weapon, whereas if filed as an individual, you have to be present at all times when it's being shot. Theoretically.

[Marble]

The paperwork for an NFA trust can be done yourself using Quicken WillMaker. Here is a copy of a really good post from another gun forum I frequent about how to create an NFA trust.

Code: Select all

NFA Trusts, or The Subtle Joys of Playing with the NFA.

DISCLAIMER

I am not a lawyer, this is not legal advice. If you go this route, read up on it your damn self and consult a lawyer, this is for entertainment purposes only, etc, etc.

If you want some content added, have corrections, notice any speeling errors, think I'm a big jerk, or have something terribly, terribly wrong in this thread, email me at my username at zoso dot org. I'm happy to edit this into something more useful that my little narrative. Email's quicker than PMs and it'll keep the thread relatively cleaner than mass-posting about my terrible flaws.

I am also not an NFA expert by any means. I've just read an awful lot and have a few stamps through this method. It works as recently as two weeks ago (April 2011).

Thanks to Craptacular for corrections.

History

The National Firearms Act of 1934 was an attempt to prohibit, or at least curtail, usage of certain classes of firearms that had become really popular in crime at the time. A few bad apples in so-called "organized crime syndicates" had to ruin it for the rest of us. In order to enact the law without curtailing the right to own firearms, the prohibiting means were in the form of a $200 tax. At the time, this little stamp's value in 2010 dollars is equal to $3,271.95. If it kept pace with inflation it would be one hell of a hefty sum to tack onto your little SBR dreams, but thankfully inflation has made it merely annoying instead of prohibitive.

However, going through the trouble of writing a check and filling out paperwork usually won't cut it. The forms require individual fingerprinting, a photograph, and your local chief LEO to sign off on the request that the individual is fine and dandy- and many do not. This, in effect, limits NFA ownership to counties and cities with open-minded CLEOs. A lot of police in general don't think normal people should have firearms in general, much less silenced machine guns (broad sweeping generalization but true), so most places have a de facto ban on NFA items.

One can get around this because the law regulates individuals and entities. An entity can be a corporation (S, C, LLC, etc.) or a trust. The wonderful thing about entities is that there is no person to be fingerprinted or photographed, and there is no CLEO request necessary since the entity is not a person. This is not a loophole, but how the law was designed. You're still going to undergo a strict background check at the Federal level, it just bypasses fingerprinting, photographing, and CLEO signoff.

Craptacular posted:
The NFA wasn't written with a CLEO requirement. I've seen some old registration and transfer forms and they didn't have a CLEO signoff section. The signoff requirement is just a section in the Code of Federal Regulations (ATF policy), not the US Code (actual law written by Congress). It could be removed without Congress writing new law. Apparently there's a proposal going through the ATF & Justice Dept right now to do that, and turn the CLEO signoff requirement into a CLEO notification requirement, for both transfers to real persons and trusts/corporations, so it's like the CLEO notification for FFL applications.

I imagine theyre not doing this just to be nice, but because they want to encourage transfers to real people instead of trusts and corporations. They can run people's names and prints through the FBI (hardly a strict background check, only more strict than a normal NICs check because of the prints), but it's possible for trustees and corporate officers to possess guns that were transferred to the corporation/trust through a NICS check on another trustee/officer, which the ATF doesnt really like, so they want to encourage transfers to real people instead.

For the purposes of this guide, I'll be focusing on a trust. Theoretically you could also go this route with a corporation, but having owned two of them, there's a lot of extra paperwork involved and legal ramifications that I chose not to get into. Keep in mind that if you're going to a corporation for liability purposes, you'll want to read up on piercing corporate veils and your obligations to maintain the company, which usually means getting a lawyer and insurance and doing certain things on a yearly basis. A trust, however, only needs some boilerplate language and a notary to sign off on, and there's no ongoing requirements for maintenance. If you want liability protection, get liability insurance. It's cheap!

Regulated Items

In general, manufacturing or transferring any of these is subject to the $200 NFA tax. As an individual, you will most likely never be able to manufacture a machine gun (FFL with Class 2 SOT, closed registry)

Machine guns: anything that goes bang more than once per trigger pull. The device that allows this to occur, if it is separate from the firearm, is considered a machine gun in its own right. An AR drop-in auto sears, despite being a $1 chunk of bar stock, is the actual machine gun. The AR it goes in is merely a rifle.

Silencers: anything that can potentially muffle the report by 1db is a silencer. Stuffing a pillow onto a hollowed out 2-liter of coke that you duct-taped on the end of your .44 Magnum? Congratulations, you're a felon!

Short Barreled Shotguns and Rifles: Shotguns under 18" of barrel or OAL under 26", shoulder fired. Rifles with barrels under 16" of length or OAL under 26", shoulder fired.

Destructive Devices: explosive ordnance and large bore firearms over 1/2" bore, shotguns exempt. Not only is your 40mm grenade launcher a DD, but every HE round you buy for it. Join the army, it's cheaper in the long run. Line throwing devices and flare launchers are exempt. I don't think we have too many goons playing around with explosives or extremely large bore firearm fabrication, but I could be wrong.

Any Other Weapon: the fun catch-all. Anything bizarre goes in here, like shoe guns, zip guns, cane guns, cell phone guns. This also includes PGO shotguns with a barrel length of under 18" and pistols with a VFG or other grip (handgun designed not to be fired with a single hand). If you put a $5 UTG forgrip on your Glock, you're here. The fees are $200 to manufacture (tightening down that grip screw) or $5 to transfer. Perhaps the most famous in this category is the Serbu Super Shorty.

Requirements

You'll need:
Quicken Willmaker, I've used the 2009 version for this guide
A notary public
Half a brain
Oodles and oodles of patience

The Trust

Fire up Willmaker, select Estate Planning and Living Trust - Basic Trust. You'll want an individual living trust. If you're married you can create a joint trust for property shared, but it's not necessary. You can name your husband and adopted Guatemalan children as beneficiaries just fine with an individual trust.

You will be the grantor and trustee of this trust. You need to name someone to be the successor trustee- this is the person that executes the trust's obligations after your death or incapacitation. This must be a separate individual! A lot of the ATF rejections came from idiots putting themselves as successor in case of their own death, which is an invalid trust. The successor trustee does nothing except distributing the property of the trust to the beneficiaries, they do not become owners in the event of your death, just bureaucrats.

You will also need to select at least one person to determine your capacity to manage the trust. This must also be a separate person, and not the successor trustee! This person should be trustworthy, and if they decide you're brain dead other otherwise incapable of being the trustee the successor trustee takes over. So ask your babysitter/glory hole manager/RV dealer or someone else you trust explicitly.

Now let's assign some property. Grab a dollar bill. Describe the dollar bill: "One US Dollar, serial number XXXXXXXX". Do not add anything else aside from the single solitary dollar. Go forward a bit and select that dollar and specify that it has no title document.

Name your beneficiaries. They will receive your NFA items upon your death or incapacitation. Don't worry, the items transfer tax-free under the ATF Form 5. If you wish, name alternate beneficiaries, and if they're underage you'll have to think long and hard about how they will inherit your NFA items- you'll need a custodian or subtrust. If you have children and life insurance you've probably already thought about these things.

When you're done, review all documents: the declaration, certification, and letter to successor. Export them as RTF. We're going to edit them a bit to change the name and clean things up.

Now fire up good old Word and let's edit. The first few pages are disclaimers, instructions, and a coupon. Fun! Read or print out these pages and remove them. We are going change the name of the trust to make sure there's no conflict with any other trust in your name that you may already have or create down the road, and it's a really simple means of spelling out in large letters that this is, in fact, for NFA items if you get inspected at the range by police or other LEO. You could name it something ridiculous like "Hot cock in my throat Trust" but it's better to err on the side of caution. Now, very carefully, change the WillMaker generated name of the trust "DkHelmet Revocable Living Trust" to "DkHelmet NFA Revocable Living Trust." In my copy there is a reference on Declaration page 1 and two on Assignment page 1. Read over it carefully and have someone else proofread. Jesus Christ don't mess this one up.

Break the document into four parts: Declaration of Trust.doc, Assignment of Property.doc, Schedule A.doc, and Letter to Successor.doc.

Back in WillMaker, select Estate Planning and Certification of Trust. This is much simpler. Export as RTF, and edit again. My version has three references on page 1 and one on page 2, YMMV. Remove the instructions as before and save as Certification of Trust.doc.

Print 'em up. Now take the unsigned declaration document and certification to a notary and sign in their presence and have them notarize it. Sign and date the assignment of property. Congratulations! You have a trust. Paperclip the dollar bill to your Schedule A and STORE THE ORIGINALS SOMEWHERE SAFE. Make a bunch of copies of the notarized declaration and certification, you'll need them. You can deal with electronic copies of your Schedule A.

More Paperwork

Download a copy of the ATF Form 5330.20, aptly named Certification of Compliance with 18 USC 922(g)(5)(B). This certifies that the NFA trust's trustee (you) is a citizen or not.

I've prefilled a version here.

Box 1: Name under which filed: DkHelmet NFA Revocable Living Trust
Box 2: Name certifying citizenship: Helmet, Dk
Box 3: Country: USA

If you're a resident alien, you've got some more boxes to fill out, but you should be used to tons of paperwork anyway.

Sign, date, and make lots of copies. STORE THE ORIGINAL WITH YOUR ORIGINAL TRUST DOCUMENTS. Technically it's not necessary to guard this, since it's just a certification, but I err on the side of pedantry.

The fun part

Getting your NFA item. Pick out something you like. Pay for it and have it transferred to your dealer of choice. Once your FFL has it, complete the Form 4 with their help and send it on its way.

If you are manufacturing a SBR or SBS on a Form 1, you'll need to get it engraved properly. I've worked with Orion Arms, they're not bad and have a quick turnaround. I've heard that you should get it engraved before you file the Form 1 since afterward it's a NFA item and problematic to ship, but I can't confirm this. Engraving must be trust name, City, State: "DkHelmet NFA Revocable Living Trust, Achin *******, AK".

Even More Paperwork

ATF Form 1: Manufacturing a Short Barreled Rifle or Shotgun.

Prefilled version here.

Box 1: Type of Application: a, tax paid
Box 2: Application made by: corporation or other business entity
Box 3a: Empty
Box 3b: Applicant's name: DkHelmet NFA Revocable Living Trust, 123 Any Street, Achin' *******, AK, 12345
Box 3c: Empty unless 3b's a PO Box. You must include a physical address.
Box 3d: Your county name
Box 3e: Your telephone number
Box 4a: This is your receiver details. For a SBR AR, it may be "Lewis Machine & Tool Co, Milan, IL"
Box 4b: "Short Barrel Rifle" or "Short Barrel Shotgun"
Box 4c: caliber
Box 4d: Model number. For the above ABR AR, it would be "Defender 2000"
Box 4e: Barrel length, do not put quotes or in after the numbers, it's assumed in inches. "10" for a 10" AR barrel. Don't round, a Krink barrel is "8.3"
Box 4f: OAL. "28.5"
Box 4g: Serial number.
Box 4h: Empty
Box 4i: Intent: "All lawful purposes"
Box 4j: Reactivation: no
Boxes 5-6: Ignore and leave empty
Box 8: Name and title: DkHelmet, Trustee
Box 9: Date
Box 10: Answer the questions truthfully
Boxes 12-13: Ignore.

Print out two copies ON BOTH SIDES, OR DUPLEX. This must be one physical page, otherwise a crafty person could reuse the side with the CLEO signoff for multiple applications. Yes, you don't need the CLEO signoff but the ATF still requires this to be only one sheet of paper. Sign box 7 in blue or black ink on both copies, write a $200 check to Bureau of Alcohol, Tobacco, Firearms, and Explosives, photocopy for your records and mail both original Form 1s with copies of your Certification of Compliance with 18 USC 922, Declaration of Trust, Certification of Trust, and Schedule A to:

National Firearms Act Branch
Bureau of Alcohol, Tobacco, Firearms and Explosives
244 Needy Road
Suite 1250
Martinsburg, WV, 25405


Mail checklist: two Form 1s, both signed. Certification of Trust (copy), Declaration of Trust (copy), Certification of Compliance, Schedule A, check.



ATF Form 4: Application for Tax Paid Transfer and Registration of Firearm

Prefilled version here.

Box 1: Type of transfer: $200 for a silencer, SBR, SBS, or whatever. $5 for an AOW.
Box 2a: Transferee's Name: DkHelmet NFA Revocable Living Trust, 123 Any Street, Achin' *******, AK, 12345
Box 2b: County
Box 3a: Your FFL's name and address
Box 3b: Your FFL's phone number
Box 3c: Empty, ignore
Box 4a: This is your receiver details. For a SBR AR, it may be "Lewis Machine & Tool Co, Milan, IL"
Box 4b: "Short Barrel Rifle", "Short Barrel Shotgun", "Silencer"
Box 4c: caliber
Box 4d: Model number. For the above SBR AR, it would be "Defender 2000"
Box 4e: Barrel length, do not put quotes or in after the numbers, it's assumed in inches. "10" for a 10" AR barrel. Don't round, a Krink barrel is "8.3"
Box 4f: OAL. "28.5"
Box 4g: Serial number.
Boxes 5-6: Empty, ignore
Box 7: Your FFL's FFL ID Number
Box 8: Your FFL's EIN and SOT Class number
Box 9: Circle YES. This will allow you to query the status by phone
Box 10: Your FFL's signature. NOT YOURS.
Box 11: Your FFL's name
Boxes 13-14: answer truthfully
Box 15: I, DkHelmet NFA Revocable Living Trust, have a reasonable necessity to possess the machine gun, short-barreled rifle, short-barreled shotgun, or destructive device described on this application for the following reason(s) all lawful purposes
Boxes 16-17: Ignore

Print out two copies ON BOTH SIDES, OR DUPLEX. Same deal as for a Form 1. Sign and date Box 15 in blue or black ink on both copies, write a $200 check to Bureau of Alcohol, Tobacco, Firearms, and Explosives, photocopy the whole thing for your records and mail the both original Form 4s with copies of your Certification of Compliance with 18 USC 922, Declaration of Trust, Certification of Trust, and Schedule A to :

National Firearms Act Branch
Bureau of Alcohol, Tobacco, Firearms and Explosives
P.O. Box 530298
Atlanta, GA 30353-0298

Mail checklist: two Form 4s, both signed. Certification of Trust (copy), Declaration of Trust (copy), Certification of Compliance, Schedule A, check.


The Wait

Transfers take 6 weeks to 6 months. Your check will get cashed immediately, do not get happy at this point. Wait a month and then call the inquiry line listed on the instructions of your form, (304) 616-4500. Don't flood them with calls, but you can keep a good eye on what's going on every week or two.

O Joy! It's here!

If you got back your Form 1, congratulations! Your lump of metal has magically become a registered short barreled rifle or shotgun!

If you got a positive on your Form 4, call your FFL and let them know it's coming. Resist the urge to call each day and ask. Once it's all there, go in and fill out for 4473 as usual, pay the man, and go home and giggle.

Amend the Trust Documents

Copy the Assignment of Property.doc file to Assignment of Property - LMT SBR.doc or something equally descriptive. Edit it, adding in the new item. Print, sign and date, store with the originals.

Edit Schedule A. Add in the new NFA item. Save and print, store with the originals, replacing the original Schedule A with the updated one.

Technically, the returned Form 1 or 4 in the trust's name is sufficient for assignment of property, and technically you never need to send Schedule As with your application. Technically. However, I have had a rejection for not sending in my Schedule A. Go figure. It's best to be especially strict when it comes to legal documents, and I do everything above the board with respect to this trust.

At the Range

STOP! Before you go running around with your $200 stamp, get it photocopied in color, both sides. Take a copy with you whenever you travel with your NFA item. Leave your original, stamped copy with the other trust originals, preferably in a safety deposit box or someplace equally fire and loss proof. You do not need nor want to take the original documents anywhere. If you travel interstate with a SBR, SBS, machine gun or DD, you need to request permission for travel from the ATF using form 5320.20. Silencers and AOWs are exempt.

You may not lend the NFA item to anyone. It must be used in your presence. Don't let it out of your sight or possession.

You may want to place a copy of Form 5 with your trust documents and stamped forms, with instructions on what to do upon your death. Think positive!

Enjoy your constitutionally protected right to have a short barreled, silenced machine gun!


[Hmac]

The paperwork for an NFA trust can be done yourself using Quicken WillMaker. Here is a copy of a really good post from another gun forum I frequent about how to create an NFA trust.

Notice of Proposed Rulemaking by ATF has been filed, apparently. A little regulatory tweaking. In many corners of the government, the trust route is considered a "loophole" in the registration process.

http://www.reginfo.gov/public/do/eAgend ... =1140-AA43

The Department of Justice is proposing to amend the regulations of the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) regarding the making or transferring of a firearm under the National Firearms Act. The proposed regulations would (1) add a definition for the term "responsible person"; (2) require each responsible person of a corporation, trust or legal entity to complete a specified form, and to submit photographs and fingerprints; (3) require that a copy of all applications to make or transfer a firearm be forwarded to the chief law enforcement officer (CLEO) of the locality in which the maker or transferee is located; and (4) eliminate the requirement for a certification signed by the CLEO.

Jshuberg posted a nice summary of the trust route a while back. viewtopic.php?f=52&t=36480&p=405081&hilit=nfa+trust#p405081

[The Ghost]

Thanks guys! I appreciate all the feedback.