I had a person ask me about the difference between a gun trust and his existing living trust. I sent him the following (I’ve changed his name to protect his privacy):
Fred,
Again, thanks for contacting me about gun trusts and more specifically, how a gun trust differs from your existing living trust. I’ll try to be brief:
A gun trust or NFA trust is a purpose-built trust, meaning it is drafted specifically to handle and deal with firearms generally and NFA items specifically.
As I’m sure you’re aware, firearms, unlike almost all other property we may own, is very heavily regulated, especially when it comes to “possession” and “transfer” of those firearms—of course, NFA items are even more heavily regulated. In particular, the laws and regulations governing guns define the terms “possession” and “transfer” very broadly to the end of keeping firearms out of the hands of so-called “prohibited persons.” For example, if you own a suppressor or silencer, and you keep it in your home, and your wife or girlfriend has access to it—meaning, if they wanted to, they could pick it up willy nilly—a zealous prosecutor might consider that “constructive possession” and a violation of the law, an accidental felony, if you will.
Because of all this, the typical living trust is not suited to owning firearms and the issues that come with them. For example,
- A well-drafted gun trust has specific provisions in it to enable others to “possess” your NFA items and other firearms without running afoul of the law. The typical living trust doesn’t.
- A well-drafted gun trust has specific provisions to protect against the unlawful “transfer” of NFA and other firearms without violating the law. The typical living trust doesn’t.
- A well-drafted gun trust has specific instructions to your successor trustees, so they don’t violate the law as they deal with your firearms in the event you die or become incapacitated. The typical living trust doesn’t.
- A well-drafted gun trust comes with the forms necessary to appoint and terminate co-trustees and lifetime beneficiaries in order to effectuate the lawful possession by and transfer of your guns to others. The typical living trust doesn’t.
On a related note, each time you do buy a suppressor or other NFA item using your trust, you are going to have to submit a copy of your trust, including schedules, etc. to the ATF. Do you really want to give your entire living trust to the ATF?
For these and other reasons, the attorneys I know who practice in this area use gun trusts to handle their clients’s firearms rather than revocable living trusts.
I hope this helps. I hope we have the opportunity to work together on your gun trust.
Respectfully,
Greg Taggart
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