So you want to buy a can

One of the ways to expedite the purchase process for a suppressor is to set up a trust.  It’s easy to waltz into your local gun shop and set up a free trust. Most gun stores around here at least, have a 1-4 page scripted trust document they are more than happy to slap your name on in the interest of selling you the can behind the counter, but that doesn’t create the magical legal shield you imagine in your head.
Early in November estate lawyer (loyal customer, retired airborne ranger and fellow firearm fanatic) Dennis Brislawn sat down with the West Coast Armory ninjas to give us a class on trusts, and it was an eye-opener.  It turns out that most of those free trusts are worth every dime you spend.
I’m going to start out this series by attempting to describe what a trust is as simply as I can.  As explained to us in the class, conceptually a trust is a “box” in which property is kept.  As grantor (settlor, trustor, donator, creator…), I own this box and I put my stuff in it; I can provide benefits from this box to the people I select (benificiaries), and I can appoint someone to operate the box: a trustee, who must follow and enforce all the rules of the box as I have written them. (I can be this trustee.)
This means if I have a silencer stored in my box, then anyone I’ve listed as a benficiary also gets to play with my silencer, as long as they follow the rules of the box.  It’s the trustee’s job to make sure they follow these rules.  So what can these special “boxes” do for gun owners?

 

First of all, it means we can buy NFA regulated items without a CLEO signature.  Since it is a legal entity purchasing the item, and not the individual, this necessity is bypassed – as well as the need to submit fingerprint cards and photographs.  (You will still go through a NICS check, though.)  The ATF will review the complete trust; if your trust owns unregulated firearms, they may need to be disclosed.  In one submission of a trust by attorney Dennis Brislawn, he provided a Schedule B that lists any unregulated firearms but left it blank as “not required”.  The ATF may reject the trust for this reason, but he wanted to see.

A trust also provides a convenient place to list all of your firearms.  In our trusts we established “Schedule B” as a listing of all our unregulated toys: guns, holsters, mag pouches, slings, anything we want.  I have all my firearms, descriptions of each and serial numbers listed in one happy place.  I have a legal registry of my documents that still retains my privacy.  (While information about your assets can be subpoenaed if you are sued, a trust isn’t a matter of public records – it’s between you and your lawyer.)  As someone who used to work in insurance I get far too excited over this notion.  Take that insurance companies.
Trusts are helpful for estate security, as well.  They provide a distrubution plan for all your assets without necessitating probate.  So you can parcel out your items without having to go to court, keeping your property out of the public eye.  A well written firearms trust also assures that, even if your loved ones don’t have knowledge of firearms laws, your guns will be safely and legally transferred during life or after.  The extra security provided is particularly important for firearms because of the state to state differences regarding transfer and ownership. Providing for your firearms in a trust gives you the opportunity to leave specific instructions on what to do with your firearms upon death or incapacity. This means not leaving your black rifle to Aunt Melinda in Connecticut or your handgun to your 5 year old, where it isn’t legal for them to do the transfer, or for them to accept or own the firearm.  Do be careful with this, though, as a trust can be worded to include ALL your possessions or ONLY those listed, and can trump your written will.
I’m going to write a little bit more on trusts, because I think it’s an important topic for firearms owners to be aware of. In the mean time, if you want to find out more you can check out the NFA Gun Trust Lawyer Blog.

16 comments for “So you want to buy a can

  1. Chris Muncy
    December 16, 2010 at 10:07

    Great article Shelley. You really need to pay for a trust to be set up correctly the first time.

    Also another thing to consider: Keep a separate trust for your firearms. If you already have a trust for your worldly goods, keep those separate. Makes it easier to manage the toys.

  2. December 16, 2010 at 10:22

    We give our customers a list of lawyers familiar with firearms trusts…the paltry sum of money it costs is well worth knowing that it was done correctly for your particular situation. Do not use the boilerplate trusts and do not think that you can copy your buddy’s trust, change the pertinent information and be okay!!

  3. Chris Muncy
    December 16, 2010 at 10:23

    Agreed Greg. Information like this needs to be drilled in to potential NFA purchaser’s heads. DON”T MUCK THIS UP!

  4. Mike Nguyen
    December 16, 2010 at 10:59

    What a lot of people who advocate DIY trusts don’t appreciate is that if you screw up, you may end up with a legally deficient document and no trust was actually created or exists, notwithstanding the piece of paper in your hands. If that is the case you might end up in the possession of an unregistered NFA firearm. Approval by ATF is not a legal determination that your trust is valid, at most it means they didn’t find any obvious flaws on the face of the document.

  5. Pete
    December 16, 2010 at 11:01

    Great information! I’m a lawyer in northern Indiana, and I’ve been thinking about getting into this area for a while. You’ve pushed me over the edge to make a serious effort to get up to speed!

    • December 16, 2010 at 23:30

      Glad to hear it, Pete! One of the reasons I’ve considered pursuing a JD is to learn more about firearm laws, especially regarding NFA items, it really is an interesting (and screwed up) bit of legislation.

  6. December 16, 2010 at 11:02

    Alas, the Trust still cannot legally “use” suppressor in Washington State…

    • December 16, 2010 at 11:08

      The funny thing about Washington State suppressor law is that you can own the suppressor, you can have it mounted on the gun but you cannot SHOOT it. This law is nearly unenforceable though since you would have to be seen SHOOTING it – a hot suppressor and a bunch of empty casings is not enough. Also, the law does not make an exception for LEOs.

      The funny thing is if you look at the law: http://apps.leg.wa.gov/rcw/default.aspx?cite=9.41.250 it pretty much says concealed carry is illegal here. It is just a poorly written RCW.

  7. Gerald Sexton
    December 16, 2010 at 13:28

    Wow. Now it makes sense. I agree it’s worth having a professional write the trust…but what qualifies as a “paltry sum” to do so?

    • December 16, 2010 at 14:26

      WCA is actually running classes now for $250 that will give you a trust from Dennis Brislawn and all the information you need!

    • December 17, 2010 at 15:08

      One of our customers just had one done for about $350. His was a bit more complicated than most but considering that his first items on it are going to be a $18,000 firearm and about $2000 in suppressors ($1000 in transfer costs) it’s not really a huge amount for what a trust establishes.

  8. Joe Houser
    December 16, 2010 at 16:01

    No cans at all in Minnesota:-(

    • aczarnowski
      December 17, 2010 at 08:16

      Alas, with everything else going wrong in this state, I’ve had to put that stupidity to the back the list.

  9. December 17, 2010 at 08:26

    If you need help dealing with these trusts or have questions I will be happy to help

  10. December 19, 2010 at 22:42

    There seems to be something missing. I thought a trust was for rights of inheritance. What does that have to do with buying a suppressor?

  11. Geodkyt
    December 20, 2010 at 14:02

    Trusts aren’t just for inheiritance, even though that’s the most common type people think about.

    First off, I AM NOT A LAYWER. If I make a mistake, and you rely on it and get jammed up — sucks to be you. Talk to a real lawyer with experience in this stuff before heading down this road.

    Second, if I incorrectly use technical legal language in such a manner as to be wrong, even from a “basic layman’s discussion” level, well, see #1.

    You can set up a trust while you are still alive, too. Which is what this is. You establish teh legal trust (including limits on what it can contain), appoint trustees to oversee and execute the trust, and designate the people who are supposed to be allowed to utilize the assets. Then you place property in the trust.

    Since a trust is a legal entity (just like a corporation), the “trust” can buy guns, including NFA “firearms”. Since the trustdoes not have finger prints or a face to photograph, those are omitted from the form. That saves a couple of bucks (less than teh trust costs, so yippy skippy, there).

    Since ATF has not expanded its unstatutory CLEO signature requirement to legal entities other than natural persons, no CLEO signature is necessary.

    This is truly where a trust starts to pay off — while NO ONE has been rejected for being unable to get a CLEO signature, a lot of people have run out of patience or ideas on who to ask for a signature before exhausting the list of people whose signature ATF would accept. Now, you don’t even have to ask the sheriff (unless your state law has a seperate requirement).

    Another place where the trust shines is spouses and familiy members in your home. Technically, if they are not teh registered owner of an NFA item, they are not even allowed to have access to the place whee it is stored — if your spouse knows the combo to the gun safe where your Sten or suppressor is stored, ATF can make noise. And NFA “firearms” cannot be registered jointly.

    If, on the other hand, the NFA stuff is owned by a trust, it is not owned jointly — even though your spouse could well be listed as a trustee, and therefore have unquestioned access! You could leave the NFA guns with your spouse while you’re out of town, and your spouse could legally take them out shooting, etc., exercising all of the rights in regards to that NFA property the trust grants them just as if they were the individual regsitered owner on a “normal” NFA registration. (If the trust says, “trustees may not unilaterally sell items,” “trustees may only take guns to the range if the other trustees agree,” — whatever the limits the trust sets would be the only limits in terms of property rights.)

    Likewise, guns in trusts can make estate planning easier in one of several ways:

    1. If the trust is constructed so that it doesn’t end up dying with you, then the guns do not need to ever be transferred out of the trust, and the people you wanted to have access to teh guns could retain access, if teh trust is worded to retain their access (say, by designating them trustees in succession).

    2. The trust can be written to state that things transferred out of the trust in accordance with some event (like the principle trust grantor’s death) may only be transferred when and if the person receiving the item may legally take possession, and teh trust will hold on to it until that time. (Same deal as the classic, “You inheritance is in trust until you turn 25,” kind of thing.) That way, you don’t end up with an NFA firearm that cannot be passed to your kid because he’s only 5 when you die. When he turns 21, he can pick up the gun. (Although I believe he has to pay a $200 transfer tax then, becuase it isn’t a straight inheritance deal anymore. Ask an experienced NFA trust lawyer.)

    3. So far as I know, so long as the trust stays intact, nothing in it is subject to the death tax or probate, as it isn’t an inheirited estate item. The stuff went into the trust free and clear (although trusts established by a will may have to pay estate tax as things go into teh trust — ask any trust lawyer), and teh trust isn;t dead, so there is no ‘estate” to probate or tax here. The trust grantor may be dead, heck every one of teh original trustees may be dead. . . but the trust is still alive, just like a corporation after the founder dies is still a viable legal entity.

Comments are closed.