Gun trusts: An estate plan for your firearms
With firearms legislation once again in the headlines, savvy firearms owners should consider creating a gun trust as part of a larger estate plan. A gun trust is a trust created to hold ownership of firearms, allowing them to be passed down for future generations. Generally gun trusts are created for restricted firearms, but can include other weapon types.
Title II Firearms
Restricted firearms are guns federally regulated by the National Firearms Act of 1934 (NFA) and the Gun Control Act of 1968 (GCA). The weapons are often referred to as Title II or Class 3 firearms, deriving their names from Title II of the GCA and the Class 3 Special Occupational Tax permit.
To be compliant with federal regulations, NFA weapons must have a serial number and be registered with the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). Weapons in this classification include machine guns, short-barreled shotguns, short-barreled rifles, silencers and grenades. Additionally, the NFA has the broad category Any Other Weapon (AOW) which includes pistols with a forward grip, cane guns and weapons camouflaged as another device. NFA weapons can only be possessed and used by the registered owner. Transfer of ownership must be ATF approved and requires the payment of a $200 tax on most weapons.
Why a gun trust is beneficial
A gun trust functions like other estate planning trusts by establishing ownership and the later transfer of ownership for firearms. However, a gun trust provides additional benefits.
A gun trust ensures a continuity of ownership, even if the original owner becomes incapacitated.
A weapons trust allows more than one person to possess and use the weapons in the trust. This bypasses the ATF transfer of ownership requirement and fees along with the fingerprint, photograph and Chief Law Enforcement Officer (CLEO) approval requirements for NFA weapons.
A gun trust ensures legal transfer of firearms to other trustees when the grantor passes away. The grantor can choose trustees, while making sure to adhere to federal regulations for lawful possession. Also, the grantor can train trustees on safe handling and firearm ownership best practices.
A trust helps avoid probate because the weapons are held by the trust.
A gun trust can be amended to address any changes in circumstances.
Not every person can legally possess a firearm and beneficiaries should meet all federal regulations for firearm ownership. A comprehensive gun trust will ensure firearms are passed down to capable and prepared beneficiaries while complying with both state and federal laws.