You may be asking, What is an NFA Trust?

Don’t worry, you’re not alone.

Individual

The most common way people transfer an NFA firearm is as an individual because it requires the least amount of paperwork. This method only allows you to possess your NFA firearm(s) and it limits your ability to allow anyone else to use your NFA firearm(s) unless you are physically present with the other individual(s). You can’t let anyone borrow them and if you drive a shared vehicle with someone, for example, your husband, wife, children, parents, etc. and you leave the NFA firearm(s) in the vehicle, even by mistake, and anyone else uses the vehicle they are committing a federal felony. You may be involved in an unfortunate incident and receive a disability, as you get older and your health deteriorates you may need to go into assisted living or you may not have the mental ability to possess your NFA firearm(s). Without an NFA Trust, your family will be in a position of unlawfully taking possession of your NFA firearm(s) unless you have properly drafted a power of attorney or a Will. Your family will be required to submit an ATF Form 5 Application for Tax Exempt Transfer and Registration of Firearm to possess the NFA firearm(s) as explained in 27 CFR Part § 479.90a Estates. This can cause a lot of unnecessary burden.

If you initially transfer any NFA firearm(s) as an individual and you later change your mind and want to put the NFA firearm(s) into a Trust, you have to do everything all over again, just like the original transfer. This includes completing and submitting the ATF Form 4 for yourself as an individual into the NFA Trust, fingerprints, pictures, and paying another Stamp Tax for every NFA firearm(s) being transferred into the Trust.

NFA Trust

On the other hand, many people think an NFA Trust is a more cost-effective and flexible way of owning NFA firearms. An NFA Trust can be considered a Revocable Living Trust. “Revocable” means that the settlor can change or cancel the provisions of the trust at any time. “Living” means the Trust is effective while you are still alive. The Trust document itself called the Declaration of Trust, sets forth the relationship and duties between the settlor, the trustees, and the beneficiary. This trust is not a replacement for a will. Trusts can become complicated in the wording and legal terms so it’s always recommended to contact a competent attorney for more information. An NFA Trust allows you to add anyone else into the Trust such as a spouse, friend, or family member as a Trustee or Co-Trustee, also known as a Responsible Person or referred to as an “RP”. The following information is explained on the ATF Form 23 Responsible Person Questionnaire.

Responsible Person:
In the case of a legal entity, including any trust, partnership, association, company (to include any Limited Liability Company (LLC)), corporation, or Licensed Entity that does not pay the Special (Occupational) Tax, any individual who possesses, directly or indirectly, the power or authority to direct the management and policies of the trust or entity to receive, possess, ship, transport, deliver, transfer or otherwise dispose of a firearm for, or on behalf of, the trust or legal entity.

Trust:
Those persons with the power or authority to direct the management and policies of the trust include any person who has the capability to exercise such power and possesses, directly or indirectly, the power or authority under any trust instrument, or under State law, to receive, possess, ship, transport, deliver, transfer, or otherwise dispose of a firearm for, or on behalf of the trust. Examples of who may be considered a Responsible Person include settlors/grantors, trustees, partners, members, officers, directors, board members, or owners. An example of who may be excluded from this definition of responsible person is the beneficiary of a trust, if the beneficiary does not have the capability to exercise the enumerated powers or authorities.

  • The Settlor: The person who created the Trust.
  • Trustee(s): Think of Trustees as managers who are the main individual(s) owner(s) of the Trust. All Trustees can possess, use, and transport any NFA firearm in the Trust.
  • Co-Trustees: Think of Co-Trustees as co-managers who are individuals who can also possess, use, and transport the NFA firearm in the Trust. They do not need to sign the trust. Do not list yourself as a Co-Trustee.
  • Beneficiaries: Individuals who inherit the Trust property in the event of your death. If the Beneficiary is not included as a Trustee or Co-Trustee they CANNOT use, possess, or transport any NFA firearm in the Trust unless a Trustee or Co-Trustee is physically present with them. They do not need to sign the trust. Do not list yourself as a Beneficiary.

For example, if a husband and wife are both Trustees, either of them may possess and transport the NFA firearm(s) without the other present. You can add or remove anyone you want, at any time.

Anyone listed on the Trust as a Settlor, Trustee, or Co-Trustee must submit fingerprints and passport picture(s) when submitting an ATF Form 1 or ATF Form 4. Beneficiaries do not submit fingerprints or passport picture(s) unless they are also included as a Trustee or Co-Trustee in the Trust.

There is a lot more information about NFA Trusts that we did not include on this page. If you have any questions please contact us or contact a competent attorney for more information. For the entire process of transferring an NFA firearm as an individual or into an NFA Trust see our NFA Firearms page. If you want to set up an NFA Trust, we have a partnership with 199Trust, and we are excited to be able to give you a great discount.

Our Price Is Only $64!
(Normally $79)

Buy Your NFA Trust Now!

More in-depth information will be added soon.