Do I Need A Gun Trust?
- Posted on: Mar 15 2019
Does your family own guns? In other parts of the country this might be a loaded question, but in our neck of the woods the answer is likely “yes, of course.” Sport shooting and hunting are a way of life in Mississippi, and guns are often treasured possessions that are passed on from one generation to the next.
However, one needs to be careful about what sort of weapons are being passed on. Changing federal and state laws may make it illegal to own, possess, or transfer a gun or accessory that has been in the family for years. Passing a regulated item on to the next generation after a loved one has died can be a serious criminal offense.
In order to protect family heirlooms from seizure and make sure granny is not arrested on federal weapons charges, many families are creating gun trusts. These trusts allow multiple people to possess and use federally regulated firearms that can otherwise not be transferred from person to person without doing a lot of paperwork and paying a fee.
These weapons are often called NFA or Title II firearms in reference to the National Firearms Act of 1934 (NFA) and a revision of that law, Title II of the Gun Control Act of 1968. NFA weapons include machine guns, silencers, short-barreled rifles, and short-barreled shotguns. However, any and all weapons can be held in trust to make transferring them between owners more efficient.
A gun trust is just like any other trust — there is a grantor that creates the trust, trustees that run the trust, and a beneficiary that benefits from the proper management of the trust. When the grantor creates the trust, he or she creates rules for how the trust will be run and who can serve as a trustee. These rules must obviously comply with a lot of different laws – gun laws, tax laws, and estate planning laws. And the trustees of a gun trust must all be eligible to possess the weapons in the trust.
When the grantor dies, the trust remains. It continues operating according to its founding documents. The guns are owned by the trust in the eyes of the law, so there is no need to re-register them — assuming that has already been properly done. And no need to pay a transfer fee or have anyone fingerprinted. The guns are also passed without interference from the probate court, and are not included in the original owner’s taxable estate.
There really are a lot of benefits to holding guns in a gun trust if you intend to pass them on to the next generation. The only drawback to setting up a gun trust is that they are rather complex to get up and running. You really should work with an experienced attorney to ensure that you are complying with all the applicable laws even though there are DIY legal guides available on the internet.
Our firm has set up several of these trusts, and would be more than happy to work with your family to establish a trust that will allow you to preserve your sporting and hunting heritage.
Posted in: Estate Planning