Why Not Use My Revocable Living Trust as a Gun Trust?

Question Mark_YellowI just took a call from a fellow who asked a very good question: Why not use my revocable living trust as a gun trust? The short answer to that question is, “because.”

But if that’s too short for you, here’s a longer version I gave him–in bullet points:

  • Guns are not like virtually any other property. They are regulated. Those regulations come with stiff fines and possible imprisonment if you should accidentally violate them. Gun trusts take that into account. Regular trusts don’t.
  • To transfer your home or your bank account, it’s a relatively simple matter of signing a deed or changing the name on the account. You don’t have to worry about who the transferee is and what he’s been up to lately. To transfers any firearms, you always have to be worried about what the transferee has been up to recently or even way back when because if he’s been up to no good, he could be a “prohibited person,” and you could get into trouble for selling or giving your gun to him.
  • Transferring–giving or selling–an NFA item is even more problematic. With each and every transfer, there’s fingerprints, photos, forms, signatures, and the like AND a $200 tax AND a long waiting period before you can actually, physically transfer the darn thing. What if when you die or become incapacitated, your trustee doesn’t understand that? Big problems could ensue. (Yes, I know that the transfer tax doesn’t apply when the transfer is from the estate of a decedent to a lawful heir.)
  • A well-drafted gun trust takes care of the problems I just described because it comes full of instructions and warnings about the relevant law and issues–guidance, if you will–so your trustee knows what and what not to do.
  • A well-drafted gun trust also allows for sharing of NFA items without incurring the wrath of the gun gods. I’ve yet to see a regular revocable living trust that does that.
  • Finally, know this: when you buy an NFA item using a trust, you have to send a copy of the complete trust to the BATFE, which keeps it on file. Do you want to send them your revocable living trust that names all your children, speaks of how you want to disinherit your youngest and how you want the gold buried in your backyard to go to your brother Willard and that you want $1,000,000 of your estate to go to the American Red Cross? I wouldn’t either. A well-drafted gun trust won’t disclose that kind of information.

Anyway, that’s why you don’t want to use your regular revocable living trust as a gun trust.

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