What is a Gun Trust?

If you’re a gun collector, while you likely have heard the term “gun trust,” you may not know what it is, how it works, or how it can be useful in an estate plan.

Guns Are One of the Worst Assets to Inherit

In his video series on “Six of the Worst Assets to Inherit,” Jacksonville Attorney Bill O’Leary explains why guns are one of the worst assets to inherit.  “Guns cannot be simply handed over to another person without the proper registration or permit,” he explains.

The inheritance rules for firearms vary greatly in each state, and some states, like New York, give a very small window of time in which the executor can possess the guns without incurring criminal liability.  Because the executor cannot legally transport the firearms, they must contact the police to collect and inventory the weapons.  In addition, if certain types of firearms are not properly registered within the previous owner’s lifetime, then the weapons cannot be registered after the person is deceased, and the heirs will have to abandon the property.

Gun Laws that Make Inheritance Difficult

In his video, “What is a Gun Trust,” O’Leary explains how families can ensure they follow gun laws and ensure a smooth transfer of gun ownership to their heirs.

He explains that there are two types of firearms that are regulated by the federal and state gun laws:

1. NFA (National Firearms Act) or Title II Firearms
2. Non-NFA or Title I Firearms

Firearms classified as NFA including fully automatic machine guns or short-barreled shotguns are subject to specific requirements and regulations that owners must follow to avoid breaking the law.  Only the owner of an NFA firearm can possess it. Allowing a friend or family member to fire a few rounds with a Title II weapon at the local range or even having someone else drive your car with the firearm in the trunk is a felony!  Mismanaging the transport and transfer of weapon ownership of NFA classified firearms could also lead to federal or state offenses.

Non-NFA or Title I Firearms constitute the vast majority of gun ownership in the United States. The biggest restriction for these types of guns is who can possess them. The Gun Control Act of 1968 made it unlawful for certain people to ship, transport, receive or possess firearms or ammunition. O’Leary notes that this list of prohibited persons is large, but he highlights three issues that prevent people from possessing a firearm: those who have domestic violence convictions, those who are on probation even from a misdemeanor, habitual users of a controlled substance.  Read more in our article, Own a Gun? Careful: You Might Need a Gun Trust

Create a Gun Trust to Ensure an Easy Transfer of the Weapon to Your Heirs

Gun trusts ensure owners comply with federal gun regulations when passing on guns to heirs according to a recent article on ElderLawAnswers, What is a Gun Trust?: Estate Planning Q & A.

A gun trust is simply a legal entity that is used to hold and manage guns. Ownership of the firearm is held by the trust that designates who is legally able to possess and use it. Benefits of a gun trust are particularly useful for NFA firearms and include:

• providing for an orderly and lawful transfer of the weapon upon your death to a family member or other heir,
• avoiding probate and keeping your affairs private,
• continuing beyond your death so that heirs or loved ones do not have to pay a transfer fee,
• protecting you and your family from criminal prosecution,
• protecting against civil liability,
• ensuring your executor follows gun laws and regulations, and
• protecting an immature beneficiary.

Gun Trusts Protect You and Your Family from Criminal Prosecution by Allowing Use of Title II Weapons By Multiple People

A great benefit of a gun trust is allowing for the use of the Title II weapon by multiple parties. Each party who will have access to and use of the weapon, should be a co-trustee of the gun trust.  “Gun trusts avoid criminal liability for the actual or constructive possession of a NFA firearm,” asserts O’Leary.  “You can constantly add people to your trust as co-trustees with you to allow them to use the firearm that’s owned by the trust, and then you can simply remove them from the trust as needed.”  In addition, a gun trust can have multiple beneficiaries, so more than one person can own and use the gun after you pass away.

Gun Trusts Protect the Novice Executor

Your executor may not know the gun laws and may not know that when an NFA firearm owner dies, there are requirements to register that firearm and restrictions on transporting it across state lines. A gun trust can set up the legal framework to protect your executor in the handling of the weapon.

Additional Benefits of a Gun Trust for Non-NFA Firearms

An owner of a large collection of firearms may find it easier to transfer ownership of his or her weapons to a gun trust, even if the person doesn’t own any Title II weapons.  In recent years, the gun trust use has expanded to collectible firearms to preserve their use for future generations. Collectable firearms often are as expensive as collectible cars, so care must be taken to properly preserve and transfer them.  Gun trusts provide protection against two types of risks with non-NFA firearms: 1) lifetime risk for a civil liability for negligent entrustment of a firearm; 2) risk of a novice executor transferring gun ownership to someone on the prohibited person’s list.

Plan Early with an Experienced Estate Planning Attorney

A wonderful solution that helps avoid all of the issues related to the transfer of guns to your heirs is to create a gun trust with a knowledgeable Florida estate planning attorney.

If you’d like your family or loved ones to inherit guns, start the planning process early.  Your intended heir of the guns or gun collection may need to set up a proper firearm permit in order for them to receive the property.  The key is to plan early to avoid a scenario in which your loved ones find guns in your home after you have passed and no clear plan or documentation for how to manage the firearms.  Book a free discovery call to speak with our estate planning team who have the experience and understand the federal and Florida state laws on the ownership and transfer requirements of all firearms.