Bartholomew Roberts
Member
Introduction
Bartholomew Roberts is a pseudonym for a Texas-licensed attorney who has drafted gun trusts, is a member of the Texas State Bar Real Estate, Probate and Trust Law Section, and who has taken David Goldman's "Gun Trust" CLE through the ABA.
Often, in reading Internet discussions of whether someone should use an attorney-drafted trust or a "generic trust" from a legal form service such as Quicken, LegalZoom, etc., I see groups of people who don't know what they don't know. One day, I got tired of addressing common misconceptions one at a time and decided to write this short article in hopes of helping non-professionals understand the differences between a generic form trust used for a gun trust and an attorney drafted gun trust. This will, I hope, give you some idea about what a gun trust is and some things to think about if you decide you might want to set one up. But this is not intended to tell you in detail how to go about it and it is no substitute for a professional consultation with an attorney.
What is a Trust?
First, let’s discuss what a trust is. Most commonly, a trust is a device to hold property for the future use of other people. In the distant past, when people died and their children were not yet of age to manage land or other expensive property, the property would be placed in a trust. The trustee was the person who managed the property for the benefit of the children, who are called the beneficiaries. The key features of a trust are that it involves a future interest and it distributes control and use of the property to more than one person. Additionally, in many states, the trust must have a set lifespan and will one day have to terminate and distribute its property.
Over time this idea was extended more broadly so that people could give property to trusts while still alive (living trusts) and even revoke the trust and retake possession of the property (revocable trusts). Trusts, however, are a creation of state law and what powers they may have depends entirely on your state law. Accordingly, the issues discussed here are only discussed in a broad, general sense to help you become better informed. Once again, this post is no substitute for consultation with a lawyer or attorney specialized in Trust Law in your state.
So what is a Gun Trust?
Many people become interested in Gun Trusts because they wish to own NFA firearms and in many restrictive areas, a Gun Trust can make this easier. There are two common reasons people use NFA Trusts. Sometimes, the Chief Law Enforcement Officer will not fulfill his obligation to sign the Form indicating that possession of NFA weapons is not illegal in your area – even if this is well understood by the courts, the legal system and ATF. Without this signature, the ATF will not process your request. However, this requirement is not necessary for a corporation or trust. A second common reason is that possession of an NFA weapon not registered to you is a serious felony crime with strict penalties. This means even your close family may not use or even have access to your NFA firearms without your direct supervision. Rather than create a situation where your wife or children can easily become felons, many families choose to use a Gun Trust since this allows for possession of the firearm by more than one person.
However, Gun Trusts have more uses than just NFA firearms. If you live in a restrictive state that is about to adopt prohibitions on the transfers of magazines or non-NFA firearms, a Gun Trust may be an excellent vehicle for making sure your children can enjoy the same rights you enjoyed when they come of age.
Three Common Ways Used to Draft Gun Trusts
Once people become interested in Gun Trusts, they soon discover some very different approaches to having one done. The first approach is to “borrow” a form from the Internet and change the names and wording as necessary. This is usually the least desirable approach; but the cheapest in terms of initial cost ($0). Much like you can be your own plumber or electrician, you can be your own lawyer as well. Except instead of 3” of water on your kitchen floor, the problems in a poorly drafted trust may not show up for years and can range from minor inconvenience, to major legal expense, to criminal charges and prison.
The second approach is to use a “generic trust” generated by Quicken, Legal Zoom, or similar software. Occasionally, gun stores will even hand out these blank forms for their customers to fill out. The trusts will have standard language with blanks for the user to fill in according to their needs. These trusts will be very simple, very broadly drafted documents that don’t address many common issues in NFA trusts. However, as long as you fill them out correctly, the ATF will usually approve the form. For example, one common error in drafting by non-professionals is to make the Grantor (also called a Settlor), the Trustee and the Beneficiary all the same person. Remember, a trust involves property interests among more than one person. Such a trust will be found invalid, even when using an otherwise valid form trust. Attached to this post is an example of a generic form "gun" trust that was posted on the Internet.
According to the poster, the trust was being handed out by a Texas gun shop to people interested in NFA firearms. This raises an additional issue for FFLs to be aware of – while a person can be their own plumber or surgeon, if you provide that same service to someone, you are required to be licensed in most states. Lawyers are no different in that regard. This generic trust has a modified Schedule A to make it more suitable for guns (ironically, it not only creates problems for the user as I’ll describe later; but if the gun shop did that modification, it could open them up to being sued for the unlicensed practice of law.)
Using a generic form trust as a Gun Trust has two major advantages – the initial cost is minimal ($30-50) and the chances of your form being approved by the ATF are very high. So if your major concern is to get your NFA toys into your hot little hands as cheaply and quickly as possible, this approach has a lot of appeal.
The final approach is to have a lawyer who specializes in trust law, or better yet, Gun Trusts specifically, draft a trust that specifically meets your needs. Ideally, a lawyer will talk to you about your needs and determine what approach works best for you. Because he does this for a living, he likely has an already drafted form or forms that are very close to what you want that he will modify as necessary. While many people don’t understand the difference between this and filling out a blank Quicken form, there are significant differences and I’ve found clients appreciate you not billing them several days work to recreate the form from scratch.
Additionally, a lawyer should not only draft a custom Gun Trust suitable to his clients needs; he should advise them on NFA law and how to avoid common pitfalls in NFA ownership. He should show you the kind of proper documentation he needs to defend you in court if you do have a problem somewhere. And he should help familiarize you with the tax consequences of trusts. As an added bonus, lawyers can be very handy in navigating establishing a bank account for your trust. You may have read recently that several banks have refused to do business with gun businesses. According to David Goldman, a Florida lawyer practicing in this area, this practice has also been extended to Gun Trusts by some banks.
The downside is that this approach, while very thorough, also has the highest initial cost ($150-600). While I described what I think is ideal and responsible, you should keep in mind that lawyers are businesses who have loans and expenses to pay. As you get lower in prices, you may not see the same level of service I described here simply because it isn’t economically feasible.
Quick Checklist - Will a generic trust be a good fit for my needs?
So which approach best fits your needs? To be honest, the generic form trusts can be a great solution for many people and it would be a mistake to discount them. I’ve created a short checklist to determine whether one of the generic form trusts would be a good fit for you:
1. Are you single?
2. Are you primarily interested in a suppressor or NFA item with a relatively low value and no plans to expand?
3. Do you trust every single person named in your trust in any capacity 100%? Not just trust them with your life; but trust them with your money and your hypothetical wife as well? Trust them for the rest of your life?
4. Are you going to be mentally OK with having the same people you trusted take every single thing you put in the trust and selling it for their own benefit/destroying it/taking it? Would you still consider that a good deal compared to the initial cost of an attorney?
5. Is your primary interest just to own an NFA item (not to deal with magazines or non-NFA items) and you don’t really care what happens with it after you die or whether it creates problems for those who handle your estate?
If you answered “YES!” to all of those questions, then you are probably a good fit for a generic form trust. Now using a generic trust doesn’t mean all of those things WILL happen. It just means that the generic trust doesn’t address a lot of commonly seen issues. If your trust is full of trustworthy people with good relationships with each other, even a poorly drafted trust will handle most problems because the people involved are trying to resolve their issues with goodwill.
Examining the Generic Trust as a Gun Trust - First Problem
Now let’s examine the generic trust to see how well it works as a Gun Trust. Since this form is drafted to Texas law and I am a Texas lawyer (but not your lawyer), we will be looking at it specific to Texas. Some of these points may not apply if you do not live in Texas and as always, this is a poor, poor substitute for an actual face-to-face with a conversation with a lawyer. The first thing you’ll notice is that the generic trust isn’t a gun trust at all. It is a generic form trust that has a different schedule A to list firearms on it. However, in attempting to give this generic form trust a “gun trust” flavor, the drafter actually created a minor problem. Under NFA law, your trust may not take possession of a firearm until your form is approved. Unless you already own the NFA item in question as a private individual, you have no authority to transfer it to the Trust. If you live in an area where the CLEO signature cannot be obtained, it will have to be transferred from the FFL to the Trust directly. So the Schedule A will not be helpful in that circumstance. It probably won’t be harmful either; but if you were foolish enough to list your new intended purchase on the Schedule A, it can raise questions as to who the actual owner of the item was at the time of transfer and ambiguity about who is the legal owner of an NFA weapon is rarely helpful. The gun trusts that I have drafted actually use a very similar Schedule A. The difference is that when you fill out a gun trust I drafted, I am there to advise you how to fill it out correctly. With any generic form trust, you take that responsibility on yourself.
Common Problem #1 in Generic Trusts used as Gun Trusts
Let’s discuss a common situation with Gun Trusts. You have a family and you want to own NFA items. You love your wife and do not want her to go to prison because while you were at the range the police came by to check on a burglar alarm and discovered your short-barreled rifle registered in only your name; but that your wife had access to because you gave her the combination to the safe so she could use your handgun if necessary. So you use our generic form trust and you list your wife’s name as Trustee so she will be able to have LEGAL access to your short-barreled rifle (which she probably shoots well because it is light and the suppressor makes it quiet
). Texas is a community property state. Was it your intention in creating this trust to make even your separate property into community property? Did your wife join you in executing the trust? The generic form trust we are looking at is unclear on the intent of the Grantor as well as giving a non-professional any clue that it might or might not be necessary for the wife to join in the execution of the trust.
And what happens if one day divorce hits our happy hypothetical family? As written, the generic form trust says that “If, in the judgment of the Trustee, the Grantor becomes incapacitated by reason of legal incapacity or other infirmity, Trustee shall have full authority…” That seems like a remarkably broad grant of power doesn’t it? The same Trustee who has full authority to manage all the trust property also has the authority to declare you incapacitated and continue to manage the property. Additionally, the generic form trust goes on to say that the Trustee must be given 30 days notice before removal by the Grantor and that the Grantor is powerless to modify or alter the powers of the Trustee without the consent of the Trustee. Between this and the generic reference to the Texas Trust Act powers, anyone named as a Trustee has the power to find the Grantor incapacitated based only on their own judgment, as well as the power to sell Trust property, take loans against it, etc.
Even if it is obvious that there is a conflict between the Trustee and the Grantor, the Grantor cannot remove the Trustee without 30 days notice or restrict the powers of the Trustee without their consent. How long would it take for a registered M16 lower to sell for say $200? Less than 30 days? Will a court be willing to invalidate a sale to a third party when the Trustee clearly had those powers under the terms of the trust? Those can be expensive questions to resolve through the court system. And that broad grant of power with little ability to revoke it may be a problem in a contentious divorce.
And even if you can revoke the trust successfully - what are you going to do with the NFA items? If you revoke the trust, they will have to be transferred to the individuals who established the trust. Assuming that divorce isn't already complicating that issue, one of the common reasons for an NFA trust is that the CLEO will not sign off on the proper form. If the ATF will not approve the transfer to the individual or individuals, then being able to revoke the trust isn't a very helpful means of resolving any problems caused by the drafting of your trust.
Other Common Problems Not Addressed by This Generic Trust - A Short Rundown
These are just a few examples of commonly occurring problem with generic trusts that this trust doesn’t really address well. There are others :
1. This trust has no provisions for what happens if a Grantor, Trustee or Beneficiary becomes a prohibited person.
2. It has no provisions dealing with tax issues raised by gifting NFA items to a trust (more important in transferable machineguns or items with a value of greater than $10,000 in a single year)
3. This trust terminates on the death of the Grantor. What happens if your beneficiary is a minor child unable to possess such items due to state or federal law when you die? Will the Trustee be forced to sell off the items in order to terminate the Trust and comply with the law?
4. The trust isn't really designed to have multiple Trustees. What happens if there is more than one Trustee named (say you and a spouse) and you each have a different opinion about what is the best course of action for dealing with Trust property. Who wins that argument?
5. The Trust has no provisions dealing with waste. Remember, the purpose of a trust is to manage a future interest in property for someone else for their benefit. What happens if a beneficiary objects to the use of trust property because shooting that transferable M249 SAW will reduce its future value? Does that beneficiary have a claim against the Trustee? Of course, the Grantor could always just revoke the trust - assuming the CLEO will sign off...
For further reading, David Goldman, a Florida-based Gun Trust lawyer, keeps quite a collection of stories of various problems with generic "gun" trusts he has encountered in his practice. It makes for some informative reading in seeing the types of problems he has been asked to solve for clients who didn't want to pay the higher initial cost; but I doubt he solved many of those problems for less than $600.
Conclusion
I hope you have found some of this info useful in deciding what type of Gun Trust is going to best suit your needs. Without question, I think an attorney-drafted Gun Trust is the best option if you can afford the higher initial cost. Like many things in life, I think that in the long term that type of trust is going to cost you less than some of the options that appear cheaper at first glance. Having said that, thousands of people have used generic form trusts successfully to enjoy NFA firearms without problems yet. Nobody can tell you whether you are going to be one of those people; but those who can answer Yes to all of the questions on this checklist should be in a better position than most to have that experience. Ultimately, a trust is about planning for the future; but it can also be used to just simply streamline the NFA process. If you interested in planning for the future, a lawyer's advice is going to be invaluable because they know where the problems are going to crop up due to experience. If you just want to streamline the NFA process and are less worried about future planning, then a generic trust may be a better value for you. Ultimately, it is a decision you will have to make. I hope this piece helped you be a little better informed about those decisions.
Bartholomew Roberts is a pseudonym for a Texas-licensed attorney who has drafted gun trusts, is a member of the Texas State Bar Real Estate, Probate and Trust Law Section, and who has taken David Goldman's "Gun Trust" CLE through the ABA.
Often, in reading Internet discussions of whether someone should use an attorney-drafted trust or a "generic trust" from a legal form service such as Quicken, LegalZoom, etc., I see groups of people who don't know what they don't know. One day, I got tired of addressing common misconceptions one at a time and decided to write this short article in hopes of helping non-professionals understand the differences between a generic form trust used for a gun trust and an attorney drafted gun trust. This will, I hope, give you some idea about what a gun trust is and some things to think about if you decide you might want to set one up. But this is not intended to tell you in detail how to go about it and it is no substitute for a professional consultation with an attorney.
What is a Trust?
First, let’s discuss what a trust is. Most commonly, a trust is a device to hold property for the future use of other people. In the distant past, when people died and their children were not yet of age to manage land or other expensive property, the property would be placed in a trust. The trustee was the person who managed the property for the benefit of the children, who are called the beneficiaries. The key features of a trust are that it involves a future interest and it distributes control and use of the property to more than one person. Additionally, in many states, the trust must have a set lifespan and will one day have to terminate and distribute its property.
Over time this idea was extended more broadly so that people could give property to trusts while still alive (living trusts) and even revoke the trust and retake possession of the property (revocable trusts). Trusts, however, are a creation of state law and what powers they may have depends entirely on your state law. Accordingly, the issues discussed here are only discussed in a broad, general sense to help you become better informed. Once again, this post is no substitute for consultation with a lawyer or attorney specialized in Trust Law in your state.
So what is a Gun Trust?
Many people become interested in Gun Trusts because they wish to own NFA firearms and in many restrictive areas, a Gun Trust can make this easier. There are two common reasons people use NFA Trusts. Sometimes, the Chief Law Enforcement Officer will not fulfill his obligation to sign the Form indicating that possession of NFA weapons is not illegal in your area – even if this is well understood by the courts, the legal system and ATF. Without this signature, the ATF will not process your request. However, this requirement is not necessary for a corporation or trust. A second common reason is that possession of an NFA weapon not registered to you is a serious felony crime with strict penalties. This means even your close family may not use or even have access to your NFA firearms without your direct supervision. Rather than create a situation where your wife or children can easily become felons, many families choose to use a Gun Trust since this allows for possession of the firearm by more than one person.
However, Gun Trusts have more uses than just NFA firearms. If you live in a restrictive state that is about to adopt prohibitions on the transfers of magazines or non-NFA firearms, a Gun Trust may be an excellent vehicle for making sure your children can enjoy the same rights you enjoyed when they come of age.
Three Common Ways Used to Draft Gun Trusts
Once people become interested in Gun Trusts, they soon discover some very different approaches to having one done. The first approach is to “borrow” a form from the Internet and change the names and wording as necessary. This is usually the least desirable approach; but the cheapest in terms of initial cost ($0). Much like you can be your own plumber or electrician, you can be your own lawyer as well. Except instead of 3” of water on your kitchen floor, the problems in a poorly drafted trust may not show up for years and can range from minor inconvenience, to major legal expense, to criminal charges and prison.
The second approach is to use a “generic trust” generated by Quicken, Legal Zoom, or similar software. Occasionally, gun stores will even hand out these blank forms for their customers to fill out. The trusts will have standard language with blanks for the user to fill in according to their needs. These trusts will be very simple, very broadly drafted documents that don’t address many common issues in NFA trusts. However, as long as you fill them out correctly, the ATF will usually approve the form. For example, one common error in drafting by non-professionals is to make the Grantor (also called a Settlor), the Trustee and the Beneficiary all the same person. Remember, a trust involves property interests among more than one person. Such a trust will be found invalid, even when using an otherwise valid form trust. Attached to this post is an example of a generic form "gun" trust that was posted on the Internet.
According to the poster, the trust was being handed out by a Texas gun shop to people interested in NFA firearms. This raises an additional issue for FFLs to be aware of – while a person can be their own plumber or surgeon, if you provide that same service to someone, you are required to be licensed in most states. Lawyers are no different in that regard. This generic trust has a modified Schedule A to make it more suitable for guns (ironically, it not only creates problems for the user as I’ll describe later; but if the gun shop did that modification, it could open them up to being sued for the unlicensed practice of law.)
Using a generic form trust as a Gun Trust has two major advantages – the initial cost is minimal ($30-50) and the chances of your form being approved by the ATF are very high. So if your major concern is to get your NFA toys into your hot little hands as cheaply and quickly as possible, this approach has a lot of appeal.
The final approach is to have a lawyer who specializes in trust law, or better yet, Gun Trusts specifically, draft a trust that specifically meets your needs. Ideally, a lawyer will talk to you about your needs and determine what approach works best for you. Because he does this for a living, he likely has an already drafted form or forms that are very close to what you want that he will modify as necessary. While many people don’t understand the difference between this and filling out a blank Quicken form, there are significant differences and I’ve found clients appreciate you not billing them several days work to recreate the form from scratch.
Additionally, a lawyer should not only draft a custom Gun Trust suitable to his clients needs; he should advise them on NFA law and how to avoid common pitfalls in NFA ownership. He should show you the kind of proper documentation he needs to defend you in court if you do have a problem somewhere. And he should help familiarize you with the tax consequences of trusts. As an added bonus, lawyers can be very handy in navigating establishing a bank account for your trust. You may have read recently that several banks have refused to do business with gun businesses. According to David Goldman, a Florida lawyer practicing in this area, this practice has also been extended to Gun Trusts by some banks.
The downside is that this approach, while very thorough, also has the highest initial cost ($150-600). While I described what I think is ideal and responsible, you should keep in mind that lawyers are businesses who have loans and expenses to pay. As you get lower in prices, you may not see the same level of service I described here simply because it isn’t economically feasible.
Quick Checklist - Will a generic trust be a good fit for my needs?
So which approach best fits your needs? To be honest, the generic form trusts can be a great solution for many people and it would be a mistake to discount them. I’ve created a short checklist to determine whether one of the generic form trusts would be a good fit for you:
1. Are you single?
2. Are you primarily interested in a suppressor or NFA item with a relatively low value and no plans to expand?
3. Do you trust every single person named in your trust in any capacity 100%? Not just trust them with your life; but trust them with your money and your hypothetical wife as well? Trust them for the rest of your life?
4. Are you going to be mentally OK with having the same people you trusted take every single thing you put in the trust and selling it for their own benefit/destroying it/taking it? Would you still consider that a good deal compared to the initial cost of an attorney?
5. Is your primary interest just to own an NFA item (not to deal with magazines or non-NFA items) and you don’t really care what happens with it after you die or whether it creates problems for those who handle your estate?
If you answered “YES!” to all of those questions, then you are probably a good fit for a generic form trust. Now using a generic trust doesn’t mean all of those things WILL happen. It just means that the generic trust doesn’t address a lot of commonly seen issues. If your trust is full of trustworthy people with good relationships with each other, even a poorly drafted trust will handle most problems because the people involved are trying to resolve their issues with goodwill.
Examining the Generic Trust as a Gun Trust - First Problem
Now let’s examine the generic trust to see how well it works as a Gun Trust. Since this form is drafted to Texas law and I am a Texas lawyer (but not your lawyer), we will be looking at it specific to Texas. Some of these points may not apply if you do not live in Texas and as always, this is a poor, poor substitute for an actual face-to-face with a conversation with a lawyer. The first thing you’ll notice is that the generic trust isn’t a gun trust at all. It is a generic form trust that has a different schedule A to list firearms on it. However, in attempting to give this generic form trust a “gun trust” flavor, the drafter actually created a minor problem. Under NFA law, your trust may not take possession of a firearm until your form is approved. Unless you already own the NFA item in question as a private individual, you have no authority to transfer it to the Trust. If you live in an area where the CLEO signature cannot be obtained, it will have to be transferred from the FFL to the Trust directly. So the Schedule A will not be helpful in that circumstance. It probably won’t be harmful either; but if you were foolish enough to list your new intended purchase on the Schedule A, it can raise questions as to who the actual owner of the item was at the time of transfer and ambiguity about who is the legal owner of an NFA weapon is rarely helpful. The gun trusts that I have drafted actually use a very similar Schedule A. The difference is that when you fill out a gun trust I drafted, I am there to advise you how to fill it out correctly. With any generic form trust, you take that responsibility on yourself.
Common Problem #1 in Generic Trusts used as Gun Trusts
Let’s discuss a common situation with Gun Trusts. You have a family and you want to own NFA items. You love your wife and do not want her to go to prison because while you were at the range the police came by to check on a burglar alarm and discovered your short-barreled rifle registered in only your name; but that your wife had access to because you gave her the combination to the safe so she could use your handgun if necessary. So you use our generic form trust and you list your wife’s name as Trustee so she will be able to have LEGAL access to your short-barreled rifle (which she probably shoots well because it is light and the suppressor makes it quiet
). Texas is a community property state. Was it your intention in creating this trust to make even your separate property into community property? Did your wife join you in executing the trust? The generic form trust we are looking at is unclear on the intent of the Grantor as well as giving a non-professional any clue that it might or might not be necessary for the wife to join in the execution of the trust.And what happens if one day divorce hits our happy hypothetical family? As written, the generic form trust says that “If, in the judgment of the Trustee, the Grantor becomes incapacitated by reason of legal incapacity or other infirmity, Trustee shall have full authority…” That seems like a remarkably broad grant of power doesn’t it? The same Trustee who has full authority to manage all the trust property also has the authority to declare you incapacitated and continue to manage the property. Additionally, the generic form trust goes on to say that the Trustee must be given 30 days notice before removal by the Grantor and that the Grantor is powerless to modify or alter the powers of the Trustee without the consent of the Trustee. Between this and the generic reference to the Texas Trust Act powers, anyone named as a Trustee has the power to find the Grantor incapacitated based only on their own judgment, as well as the power to sell Trust property, take loans against it, etc.
Even if it is obvious that there is a conflict between the Trustee and the Grantor, the Grantor cannot remove the Trustee without 30 days notice or restrict the powers of the Trustee without their consent. How long would it take for a registered M16 lower to sell for say $200? Less than 30 days? Will a court be willing to invalidate a sale to a third party when the Trustee clearly had those powers under the terms of the trust? Those can be expensive questions to resolve through the court system. And that broad grant of power with little ability to revoke it may be a problem in a contentious divorce.
And even if you can revoke the trust successfully - what are you going to do with the NFA items? If you revoke the trust, they will have to be transferred to the individuals who established the trust. Assuming that divorce isn't already complicating that issue, one of the common reasons for an NFA trust is that the CLEO will not sign off on the proper form. If the ATF will not approve the transfer to the individual or individuals, then being able to revoke the trust isn't a very helpful means of resolving any problems caused by the drafting of your trust.
Other Common Problems Not Addressed by This Generic Trust - A Short Rundown
These are just a few examples of commonly occurring problem with generic trusts that this trust doesn’t really address well. There are others :
1. This trust has no provisions for what happens if a Grantor, Trustee or Beneficiary becomes a prohibited person.
2. It has no provisions dealing with tax issues raised by gifting NFA items to a trust (more important in transferable machineguns or items with a value of greater than $10,000 in a single year)
3. This trust terminates on the death of the Grantor. What happens if your beneficiary is a minor child unable to possess such items due to state or federal law when you die? Will the Trustee be forced to sell off the items in order to terminate the Trust and comply with the law?
4. The trust isn't really designed to have multiple Trustees. What happens if there is more than one Trustee named (say you and a spouse) and you each have a different opinion about what is the best course of action for dealing with Trust property. Who wins that argument?
5. The Trust has no provisions dealing with waste. Remember, the purpose of a trust is to manage a future interest in property for someone else for their benefit. What happens if a beneficiary objects to the use of trust property because shooting that transferable M249 SAW will reduce its future value? Does that beneficiary have a claim against the Trustee? Of course, the Grantor could always just revoke the trust - assuming the CLEO will sign off...
For further reading, David Goldman, a Florida-based Gun Trust lawyer, keeps quite a collection of stories of various problems with generic "gun" trusts he has encountered in his practice. It makes for some informative reading in seeing the types of problems he has been asked to solve for clients who didn't want to pay the higher initial cost; but I doubt he solved many of those problems for less than $600.
Conclusion
I hope you have found some of this info useful in deciding what type of Gun Trust is going to best suit your needs. Without question, I think an attorney-drafted Gun Trust is the best option if you can afford the higher initial cost. Like many things in life, I think that in the long term that type of trust is going to cost you less than some of the options that appear cheaper at first glance. Having said that, thousands of people have used generic form trusts successfully to enjoy NFA firearms without problems yet. Nobody can tell you whether you are going to be one of those people; but those who can answer Yes to all of the questions on this checklist should be in a better position than most to have that experience. Ultimately, a trust is about planning for the future; but it can also be used to just simply streamline the NFA process. If you interested in planning for the future, a lawyer's advice is going to be invaluable because they know where the problems are going to crop up due to experience. If you just want to streamline the NFA process and are less worried about future planning, then a generic trust may be a better value for you. Ultimately, it is a decision you will have to make. I hope this piece helped you be a little better informed about those decisions.
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