NFA Firearms (also called Title II Firearms) are guns and other items regulated by the National Firearms Act (the “NFA”). The NFA regulates the sale, use, possession, and transfer of machine guns, short-barreled shotguns and rifles, silencers, destructive devices, and AOWs. In Alabama, all of these weapons are legal.  In order to be able to transfer or make these items, the Bureau of Alcohol, Tobacco, Firearms, and Explosives requires completion of a Form1 or Form 4 along with payment of $200 for a tax stamp. Establishing a gun trust for your firearms will allow you to avoid these requirements.

A trust is a fiduciary agreement that allows a party (known as a trustee) to hold assets on behalf of one or more beneficiaries. Trusts can be arranged in many ways and can specify exactly how and when the assets pass to the beneficiaries. A gun trust, when effectively executed, will provide instructions and determine a single person or a married couple’s firearms are to be managed during his/her/their lifetime, in the event of his/her/their incapacity, and also upon his/her/their death.

While a traditional trust can be used to purchase NFA firearms, there are many problems with using a traditional trust and therefore only an NFA Gun Trust should be used. An NFA Gun Trust can avoid some of the federal transfer requirements and provide other benefits including:

Allowing more than one person to possess and use the weapons held in trust. If you name more than one person as trustee, each trustee will have the right to possess or use the trust firearms.

Keep the gun in the trust even after the current owner’s death, avoiding the usual transfer requirements. If you create a trust and transfer firearms to it, you can arrange for the trust to stay in existence even after your death. The trustees and beneficiaries of the trust would have whatever rights you grant them in the terms of the trust, meaning your heirs can avoid paying a $200 transfer tax. Also, the ATF requires that all individuals obtain approval from their Chief Law Enforcement Officer (the “CLEO”) as part of the application process to obtain a Title II firearm from another individual or Class 3 dealer. Establishing an NFA Gun Trust will allow you to avoid having to file an ATF transfer form, receive permission from the local chief law enforcement officer (CLEO), and get fingerprinted and photographed.

Avoid probate. Because the firearms are held by a trust, they do not need to go through probate at your death.

Avoid possible future restrictions on gun transfers. Although no such legislation has been proposed, many advocates of gun rights fear that someday it will be illegal to leave certain firearms to inheritors or transfer them during life. Thus, the create gun trusts in hopes of providing protection against their gun rights.

Privacy. Individuals who submit their ATF forms to their CLEO are often concerned about who will have knowledge of their firearms. They also express concerns that they will come under additional scrutiny because the police will have knowledge that they are in possession of these more restricted firearms. In most states when using an NFA Gun Trust, neither the CLEO nor the police are given notice that you will be in possession of or own the NFA firearms.

To learn more about gun trusts and how our office can assist you in obtaining a gun trust contact us today.

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