Can you explain “there is not much advantage to a trust anymore” to someone without a law degree (aka: me)
I have been buying cans since 2004. Back then, the main reason to own your NFA items via a trust was to get around the chief law enforcement officer (CLEO) signature requirement. In order to get a form approved as an individual, you had to obtain the signature of the chief law enforcement officer of the jurisdiction in which you reside on a certification that he had no information you intended to use the item for unlawful purposes. In many urban and suburban jurisdictions, sheriffs and police chiefs would just refuse to sign.
If the transfer was to a corporation, trust, or other business entity, then the CLEO signature requirement did not apply. Corporations and LLCs require annual filings and fees with the state, which is a hassle if you don't need the entity for some other reason. Trusts are generally private between the parties with no filings required ( a few states require registration I think), so that was easier. Lots of guys started creating trusts so they could get SBR's and cans and avoid the CLEO signature requirement.
A few years back, ATF changed the rules in the CFR to replace the CLEO signature requirement with the notification requirement. You just mail a copy of the form to the police chief or sheriff, but he doesn't have to sign. So, a trust no longer has an advantage in this regard.
The other perceived advantage of a trust owning the NFA item is that multiple people can possess the item. This has never been tested in court and is somewhat theoretical. Normally, if I hand you my can, and you drive off with it, unless we have an approved form 4, we have both committed a felony.
If we take the case of a corporation, obviously it is an artificial person, and it must possess property via one or more agents. This is where the 'responsible person' certification stuff comes in. If you have a corporation that has an FFL and runs a gun shop, one or more RP's have to submit fingerprints and be responsible for the firearms.
When I first created an NFA trust back in 2006, there was no RP requirement for trusts. My trust said that any of the beneficiaries were entitled to possess the trust property at the discretion of the trustee, and I listed all my close friends and family as beneficiaries. ATF used to approve transfer to that trust with no problem.
They have since changed their tune, and eventually they told me that I had to submit RP paperwork, prints, and photos, for each of those people for every transfer. So, I amended the trust to remove that language.
This is not say that the idea of a trust letting multiple people possess the NFA items is completely dead, but it has become a headache. I personally don't care to push the envelope. For a lot less than you can pay lawyers to defend you, you can just buy another can or two for your friend or family member.
So, based on all that, I have decided to just do my transfers to me as an individual. Plus, I get a tax-free transfer to my heirs when I die.
this. I just got mine and went and picked it up day after. They just pulled it off the shelf and I filling out the paperwork and left
