Trust Questions

[Praxidike]

Im about to start a trust, my first, for a couple of SBRs and one .22 can. With the upcoming NFA trust legislation about to go into effect, I just wanted to get some clarification.

Is the best wrought for me to take now would be to start a trust for each item instead of having all the items within the same trust? Also going forward vs the law how it stands now, If I decide to purchase another NFA item, I could simply create one trust for the item, remove all trustees before submitting my stamp application, and then add them back again correct w/o the trustees or beneficiaries needing to be photoghraphed and fingerprinted? In that event, he only thing the new law would have changed is the fact that I'd have to notify the CLEO correct?

 

[pdsmith505]

I see absolutely no reason to have multiple trusts unless you want a different list of people to be able to posses each item.

 

[Praxidike]

I see absolutely no reason to have multiple trusts unless you want a different list of people to be able to posses each item.

If I read the other post correctly, the benefits to having multiple trust would be to avoid having to finger print all of he trustees whenever a new item is added after july 1st.

 

[pdsmith505]

I suppose. Or you could add and remove trustees as needed when you get around to picking up a new toy.

 

[Aaron Baker]

If you are getting multiple NFA items now, then you can just use one trust for that. Since the regulation isn't in effect yet, there's no reason to have a separate trust for each item right now.

If you want to buy a new NFA item after the regulation takes effect on July 13, you have a few choices. First, you can use a new trust and only put yourself on it. In that case, only you will have to submit fingerprints and photographs and provide CLEO notification (which is less stringent than CLEO sign-off). Once the item gets approved, you can add your other trustees to the new trust then and don't have to update the ATF with their fingerprints and photographs.

Your second option would be to use the same trust you already have when you apply for a new stamp after July 13. If you have other trustees on it, then you and all your trustees would have to submit fingerprints and photographs at the time of the application. This may be too much of a pain, and what you're trying to avoid.

The final option is to use the same trust you already have when you apply for a new stamp after July 13, but to amend it to remove all the other trustees besides yourself before you submit the Form 1 or Form 4. In that case, only you have to be fingerprinted and photographed. However, I believe the safest advice right now is that if you do that, you would have to leave those trustees off until the tax stamp is approved. If you add them while the stamp is still pending, then I think the ATF could require you to update them with the trustees' fingerprints and photographs because the trust has changed before the stamp was approved. (There hasn't been a firm position or answer from the ATF on this question yet.) The problem, then, with this method is that you're removing your trustees for 6-8 months at a time, and they can't legally possess your trust's NFA items during that time.

So for now, one trust for all NFA items is fine. After July 13, your two best options are to use the same trust and submit prints and photos for all trustees, or to use a new trust for each item, and only add the trustees after the tax stamp is approved, so only you have to submit prints and photos.

Aaron

 

[Theohazard]

With the upcoming NFA trust legislation about to go into effect

Just to clarify, there was no legislation involved.

 

[pjeski]

Just to clarify, there was no legislation involved.

true

 

[Praxidike]

Thanks for thr info Aaron, and thanks pdsmih.

 

[medalguy]

Aaron I thought I read that if you add trustees after the new regs go into effect they would have to submit photos and prints. No? If no, what's the point of the new regs?

 

[Praxidike]

Aaron I thought I read that if you add trustees after the new regs go into effect they would have to submit photos and prints. No? If no, what's the point of the new regs?

My response is only in the context that you described, e.i., adding a new trustee to an already approved NFA trust. If understood Aaron correctly, after the new rules go into effect, you can add and remove trustees from a trust as you see fit WITHOUT having to have added/new trustees photographed and finger printed; however, if/when you add a new item to the trust, all trustees within the trust will then have to submit a photo and prints... Put simply, all trustees will have to submit a photo and prints whenever a new item is added to a trust (not when a new trustee is added). The submitted photo and prints would be good for up to 2 years thereafter only for the trustees that have previously submitted within that time frame.

To get around the new rules, one could simply remove all trustees before adding a new item, and then later add them back again after the item has been approved. The only thing you can not get around is the new requirement which mandates CLEO "notification" (not approval).

 

[pdsmith505]

The submitted photo and prints would be good for up to 2 years thereafter only for the trustees that have previously submitted within that time frame.

According to a lot of what I've red on the interwebs, that is NOT the case. Silencershop's blog has a write up of some key points when they discussed 41f with the ATF here: http://blog.silencershop.com/details-atf-41f/

Of note to this topic:

What Does The 2-Year Exemption Actually Mean?
The 2-year exemption has been a source of debate, but the ATF clarified that it does NOT apply to fingerprints or passport photos – which is kind of a bummer.

Basically, they’re interpreting the rule to mean you don’t have to send a copy of your trust if it hasn’t changed; but, the other requirements ALWAYS apply, even if you’ve received a recent approval.

Keep in mind that 1) I am not a lawyer and 2) this advice and a dollar is worth approximately one cup of coffee at McDonalds.

 

[Ryanxia]

According to a lot of what I've red on the interwebs, that is NOT the case. Silencershop's blog has a write up of some key points when they discussed 41f with the ATF here: http://blog.silencershop.com/details-atf-41f/

Of note to this topic:



Keep in mind that 1) I am not a lawyer and 2) this advice and a dollar is worth approximately one cup of coffee at McDonalds.

That's disappointing, pretty much means the end of e-filing for regular people (using Trusts) if the 2 year rule doesn't apply to fingerprints/photos. Unless they expand the system to allow you to upload these which I doubt will happen.