Here's my experience. I'm a lawyer and I drew up my own trust. I started from scratch because I had heard that certain aspects of the Quicken trusts weren't sufficient for NFA purposes. Specifically, issues that arise when you die or if you become ineligible to possess NFA items aren't usually addressed by standard trusts. If you die and the property is automatically given to your heirs, and they aren't eligible to on NFA items, what happens then? There's contingencies to think about.
The ATF isn't going to care about certain aspects of your trust. If your trust automatically gives your NFA items to any surviving heirs, the ATF isn't going to spin out every possible scenario to figure out if that might cause problems. They're fine with leaving NFA items to heirs. But once you actually die, and your 5-year-old son is suddenly the legal owner of a machinegun, the ATF will care. That's why you have to be careful with trusts. They're like wills--it doesn't matter what they say when you're alive, and good lord knows how screwed up they can be once you're dead and can no longer fix them.
The ATF does care about some aspects of trusts, though, and will scrutinize them. I drafted a trust that was governed by Kentucky law. Kentucky has adopted the Uniform Probate Code, which requires registration of trusts with the local court. However, when Kentucky adopted that section, they added language that exempted revocable living trusts. I'm in Alaska right now, but planned to return to Kentucky eventually, hence the Kentucky law aspect of the trust. Well, the ATF lawyer must have looked at the Kentucky statute, said to himself, "Hmm. Uniform Probate Code. I don't see proof that he registered this trust. I'll send him a deficiency letter." And he did. And then I had to write a letter explaining that I was not required to register my revocable living trust under Kentucky law. He got the letter and my form 1 was eventually approved.
My form 1 took from December 26, 2009 to July 2010. It wasn't quick. I got frustrated. But some people's form 1's using trusts take less than six months. It really just depends. I imagine it's a toss up on approval speed. Trusts don't have to go past the fingerprint, photograph and LEO sign-off reviews, but they do have to get looked at by the ATF lawyer. He took vacation during the time my form 1 was pending, so it took longer.
So yeah, trusts work. They can be dangerous if they're not properly drafted, but you may not realize the danger until years later. Or you'll never realize the danger--your heirs will when you're dead. The ATF won't pass one that's faulty on its face, but they're not going to explore every possible scenario under your trust, either. That's your job, or your lawyer's.
The non-trust route is perfectly viable, if you can get good fingerprints and an LEO signoff. (I couldn't get the latter, and wanted my wife to be a co-grantor and co-trustee so that she could possess the trust's NFA items.)
It's worth getting a lawyer from your state to draft one. You can go to that blog run by the NFA specialist lawyer and e-mail him. He'll refer you to someone. It'll probably run about $600. Or if you're a lawyer, you can do it yourself. Or if you're not a lawyer, but you're brave, you can do it yourself.
And no, before anyone asks, I'm not going to share my trust design publicly. Not because I'm a typical greed lawyer (although it'd be nice to get paid for it) but because if it's a bad trust, I'm only endangering myself right now. I don't have enough malpractice insurance to cover everyone on the internet if I screwed it up.
Aaron, who is a lawyer, but is not your lawyer.
