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So it used to be that the trust was the way to go but I recently read that individual transfers once to heirs tax free. Is this a thing and if so is there a reason to go trust still over individual?
 
Posts: 2723 | Location: Pnw | Registered: March 21, 2009Reply With QuoteReport This Post
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Originally posted by Anubismp:
So it used to be that the trust was the way to go but I recently read that individual transfers once to heirs tax free. Is this a thing and if so is there a reason to go trust still over individual?


Yes, individual registered NFA items can transfer over to an heir tax free. However you still have to submit a Form 5 for each item and go through the process. All you get out of is paying the $200.

If a family member is a trustee, they can possess the item immediately with no added paperwork or wait.
 
Posts: 2742 | Location: South FL | Registered: February 09, 2007Reply With QuoteReport This Post
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The only perk to a trust seems to be that it enables others to possess the item without you being present. It is a substantial perk, but requires every trustee to go through almost the same rigmarole as you do, for every item.
 
Posts: 917 | Location: Northeast GA | Registered: February 15, 2021Reply With QuoteReport This Post
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Originally posted by KSGM:
The only perk to a trust seems to be that it enables others to possess the item without you being present. It is a substantial perk, but requires every trustee to go through almost the same rigmarole as you do, for every item.


Not necessarily. A properly drafted trust may be amended at any time to add or remove trustees and beneficiaries. Discharging all other trustees at the time an application is submitted and then reinstating them would be a workaround.

I suggest looking at SF user heavyd's trust (NFALawyers.com)
 
Posts: 4441 | Location: Iowa | Registered: February 24, 2011Reply With QuoteReport This Post
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Ah; I see. I reckon that checks out. I have removed and added folks in the past for other reasons, and it is a simple process. However, if the alphabet boys encountered a trustee with a can of yours, and wanted to push the issue, would they not see that the trustee hasn't been vetted (filled out the abbreviated form, sent in pics and prints)? What you're proposing would enable people to "legally"(but not really) possess a silencer, even if they're not supposed to be able to own one. In this scenario, there's nothing saying I can't add a felon as a trustee. Am I confused?
 
Posts: 917 | Location: Northeast GA | Registered: February 15, 2021Reply With QuoteReport This Post
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No.

The only thing that matters is who is a trustee at the time that the transfer occurs. It is up to the trustees to regulate the trust. Somebody who was a trustee and submitted a responsible person questionnaire on an item transferred last year could be convicted of a felony today and still be listed as a trustee but unable to possess the items.

People seriously overthink this.
 
Posts: 4441 | Location: Iowa | Registered: February 24, 2011Reply With QuoteReport This Post
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So you are saying all trustees have submitted the relevant stuff one time, to fully legitimize their ability to possess items, but then they are temporarily removed to enable additions of items in the future? I understand it's ultimately on the settlor and trustees to do the right thing; there are ways to work around the inconveniences that are legit, and then there's ways that are only half-legit. Or so it seems.
 
Posts: 917 | Location: Northeast GA | Registered: February 15, 2021Reply With QuoteReport This Post
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No, what I am saying is that all that matters is who the trustees were at the time the application was submitted.

You can add a trustee later and as long as they are not otherwise legally prohibited, they can possess the items. Think about a marriage, a kid turning 18, etc. There isn't even a mechanism that exists to go back to the ATF and tell them that you've added trustees.

On the other hand, you can submit paperwork for a trustee have it processed and approved, and then thwy could subsequently be convicted of a felony and no longer able to legally possess the items. It doesn't somehow invalidate the trust or the Form 1 or 4.

So if you want to fire all your trustees, submit an application, and later reappoint them, that is within your rights as settlor and grantor.
 
Posts: 4441 | Location: Iowa | Registered: February 24, 2011Reply With QuoteReport This Post
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One thing to remember if you try the trick of getting everyone off your trust before you submit an application is that they have to stay off until the application is approved. So, that means for 9 months or more for a paper Form 4, only the one person you’ve left on the trust can have possession of the NFA item. Maybe the eforms will be faster in the end, but there still be a time period where all of the other ex-trustees are locked out.
 
Posts: 2742 | Location: South FL | Registered: February 09, 2007Reply With QuoteReport This Post
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