What is Gun Trust?
A gun trust is a trust which is regulated by the National Fireams Act (NFA). It is a revocable trust which allows Title II firearms to be owned by the trustee of such trust. Additionally, in such trust, whomever is named as trustee of the trust would be allowed to handle such firearms with no issues. Also, the language in such trust provides that a trustee may not distribute to a beneficiary of the trust any assets subject to the NFA without complying with NFA requirements, along with State and Federal laws Additionally, the trustee of such trust must complete Form 4 and/or any other form required at the time of transfer of any NFA assets to a beneficiary, along with taking any additional steps required at the time of the transfer. Such trusts also state the trustee shall determine whether a distribution makes sense by taking the following into consideration: (1) the legality of such items in the State where the beneficiary lives and/or shall store the items; (2) the eligibility of the beneficiary to be in possession of such items; (3) the laws restricting transfer of the items from where they are to where they would be going; and (4) the maturity and responsibility of the beneficiary. In addition to owning the Title II firearms, this type of trust may also allow a trustee to use assets in the trust to provide for education and training to the beneficiaries for firearm related activities, but a trustee would be under no obligation to liquidate trust assets to provide this type of training. Finally, this trust should contain language stating if a beneficiary is not eligible to be in possession of an item subject to the NFA, then the trustee shall have the option, in the trustee’s sole and absolute discretion, to either liquidate the NFA assets located in the trust in order to make a distribution to such beneficiary or distribute the NFA trust property located in the trust to one or more of the other beneficiaries identified in the same trust. This gives a trustee flexibility in determining what to do with Title II firearms which may be located in such a trust. If you think you would be interested in receiving more information pertaining to a gun trust please contact our office for a free consultation regarding the same.