Firearms Trusts

Without a trust, a family’s firearm collection may go to probate and the details are made public.
Most collectors would not want the entire world to know the value of their collections.

When I was a teenager, my father frequently told me I should become an attorney because I had a knack for arguing. Well, I didn’t go to law school, so I’m sharing with you as a layman. If any of this information strikes a chord with you, make sure you have an attorney or legal service company create the necessary documents. But I hope this gets you thinking.

The career path I did choose has allowed me to encounter folks who’ve worked hard and accumulated some assets, one of which is a nice gun collection. A chief concern of many is what happens to the gun collection when they pass or become unable to use them. There’s a solution that might work for you, and I first became familiar with it while dealing with suppressors.

Dealers in suppressors and other NFA items usually have some type of relationship with a law firm that can create a “Trust” for purchasers of NFA items. When I bought two suppressors several years ago, I engaged the services of the attorneys at U.S. Law Shield to create an NFA Trust to hold those suppressors. For some of the reasons you’re going to see, I transferred my non-NFA firearms into that Trust.

If you have a cherished family heirloom, a Trust can assure it remains in the family rather than
being sold once you pass. Great Grandpa’s old military 1911 can stay in the family — safely.

What’s A Trust?

Here’s how the Trust works. Think of it as a separate “entity” who “owns” whatever you put “into” it. You as the Settlor (in some states it’s Grantor) purchase the items on behalf of the Trust. Typically, you will also be the Trustee. You can name multiple co-trustees, allowing them to use, transport and have access to the NFA items owned by the Trust. During your lifetime you can add or remove co-trustees, name a successor trustee and a beneficiary.

Buying NFA items through a Trust doesn’t require the signature of the Chief Law Enforcement Officer where you live for you to acquire NFA items like it does for an individual. All co-trustees can use the items, and items the Trust owns can be passed down. NFA items do require ATF Form 5 if they are being passed to beneficiaries.

Even if you don’t own any NFA items, but do have a sizeable and/or valuable gun collection, there are several benefits of creating a Trust to own those firearms.

Your Privacy

If you die without having your firearms in a Trust, in most states the executor of your estate would be required to file an inventory of the probate estate. Probate inventories are public documents filed with the court and available for anyone to see. The firearms included in the estate and the market value of each would be listed in the inventory. That’s not information the heirs would probably want known to the general public. If the firearms are owned by a Trust, they would not be included in the probate estate and would not be listed on the probate inventory.

A Firearm Trust may make sense for firearms other than NFA items for collectors.

Your Collection

A Gun Trust can provide for the orderly disposition of the firearms by having them transfer to the successor trustee and co-trustees. This is an excellent way to keep the valuable firearms in the family. I suggest if you, as the Settlor, transfer your firearms to a Trust in which you are the Trustee, you name as Successor Trustee one of your close relatives who is trustworthy and who is knowledgeable about and can legally own guns. Name co-trustees who also fit that bill as much as possible. It will help the Successor Trustee and any co-trustees if you will take the time to document the history and value of each of the firearms in the collection. If the Trust is created correctly, the firearms can pass down through the Trust through multiple generations. You’ll need to make sure your Trust is written to accomplish this goal.

Buying suppressors or other NFA items through a Trust eases administrative requirements,
allowing other qualified members of the Trust to use the NFA items.

Protection

It appears even in gun-friendly states, the possibility of Red Flag laws in some form or another are going to become law. I’m sure you won’t become the target of a Red Flag action, but then again — who knows? Even without the Red Flag possibility, at some point you may simply not be competent or safe to own firearms due to age and/or health reasons. With a Trust, it would not be an issue because the Successor Trustee would be there to manage the Trust and hold or distribute the firearms based on your intentions as outlined in the trust document.

If you’ve spent a lifetime amassing a collection hard to duplicate, protect it with a Trust.

What It Doesn’t Do

A typical Gun Trust is set up as a Revocable Trust, which means the Settlor/Trustee can make changes to the Trust during his/her lifetime. From a legal standpoint it means the Settlor still owns and has control of the Firearms in the Trust. This type of Trust does not protect the assets from creditors. If you need or desire that type of asset protection it will probably cost you more and you must specify to the attorney setting up your trust that asset protection is one of your goals.

Buying NFA items through a Trust is a no-brainer. This type of Gun Trust can be created inexpensively. I see prices on the Internet varying from $59.95 up to $500. The lower cost ones are created through filling out forms online. Once completed, the Trust is emailed to you. If you do it this way, just make sure the Trust is created so it’s legal in the state in which you reside.

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