In Estate Law News

According to Pew Research, 30 percent of adults in the United States report owning a firearm. Gun sales have risen in recent years, particularly during the Coronavirus pandemic. While many reported having weapons for protection and hunting, 6 percent owned guns that were family heirlooms.

Close-up of vintage gun with ball ammunition.If you own a firearm of monetary or sentimental value, you may wonder how to transfer ownership to your loved ones after you die. In addition to creating a will, you may want to make special arrangements for your weapon.

A gun trust, also known as a firearm trust or NFA trust, is a legal entity created to hold and manage guns. Creating a gun trust can help you pass down your gun to your loved ones, shielding them from probate. It could also help you give ownership to several individuals.

Understanding Trusts

A trust is a legal arrangement where the original owner (the grantor) designates an individual (the beneficiary, or multiple beneficiaries) to receive an asset. When something is held in trust, a trustee is responsible for its management.

Trusts can shelter many types of property from probate, in which the court oversees the distribution of an estate. Property that trusts can safeguard includes real estate, bank accounts, and personal possessions such as a jewelry collection or weapons.

Some trusts are revocable, meaning the grantor can change their mind and terminate the trust. Others are irrevocable, so the person making the trust cannot unravel the arrangement. Gun trusts can be revocable or irrevocable.

The National Firearms Act

Creating a gun trust can make it easier for gun owners to comply with the National Firearms Act (NFA), particularly when multiple people want to use the weapon and when the owner intends to transfer ownership.

Congress passed the NFA in 1938 to curb the sale of firearms. The Act imposes specific requirements and regulations on firearms classified as Title II weapons, which include the following:

  • Machine guns
  • Short-barreled shotguns or rifles (SBSs and SBRs)
  • Silencers (silencers)
  • Destructive devices such as grenades
  • Firearms over .50 caliber, per the Gun Control Act of 1968

The Bureau of Alcohol, Tobacco, Firearms, and Explosives requires individuals intending to own an NFA weapon to complete an application and registration. Registration includes paying a tax and obtaining a tax stamp for each NFA firearm. Those purchasing or possessing NFA firearms must undergo a background check and provide fingerprints as part of the application process. The bureau denies any applications violating federal, state, or local laws.

Benefits of Gun Trusts

Gun trusts have several benefits.

  • They avoid probate. If you have a weapon you’d like to pass down to a specific person or people, the court does not have to oversee the transfer, and it is less likely someone will challenge it.
  • Trusts continue beyond death. You can set up the trust so that your loved ones do not have to pay the transfer fee. This makes conveying possession easier.
  • When you make a gun trust, you can choose multiple beneficiaries. More than one person can own and use the weapon.

Obligations for Trustees

Creating a gun trust does not shield trustees from complying with state, federal, and local weapons regulations.

Before 2016, only one trustee had to register, making a primary advantage of gun trusts that they allowed multiple trustees to bypass government oversight. Yet, in 2016, the legislature amended the NFA such that all beneficiaries must submit to registration, eliminating this loophole.

Per the State Bar of Wisconsin, trustees must inform their local chief law enforcement officer of the identities of all the trustees and the firearm’s location. They must also provide fingerprints and a photo and undergo a background check.

Trustees must also be eligible to own firearms. Violating the NFA is a felony. Felons, recipients of a dishonorable discharge from military service, and people who have been deemed incapacitated cannot possess a gun or be a beneficiary of a gun trust.

When trust creators fail to consider whether the intended beneficiaries may legally possess the firearm, they open the door to criminal liability for themselves and their loved ones. When creating the trust, the lawyer should consider what will happen if a beneficiary loses eligibility to possess the weapon.

Speak With an Attorney

While some retailers and online vendors offer gun trust templates, working with a qualified attorney is best. The consequences of a mistake can be severe, and the trust must comply with the law. Speak with an attorney in your area to learn more about creating a gun trust as part of your estate plan.

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