Many financial advisors who assist clients with estate planning know about various types of trusts.
These can include charitable trusts, asset management trusts (also known as spendthrift trusts), and beneficiary trusts.
But how many out there know about ‘gun trusts?’
This may depend upon whether or not you have clients who are big time gun collectors.
In a nutshell, a gun trust is a protection mechanism for folks who want to make sure that their firearm collections are handled properly after their deaths.
Like wills in the estate planning process, a gun trust, also known as an NFA Trust, (which stands for National Firearms Act), can be used to avoid probate, which becomes part of the public record and could mean that gun owner information could be made available to the viewing public.
Just like any other estate planning tool, gun trusts serve as a means to allow individuals to have a say in what happens to their legally owned firearms after they pass away.
If no gun trust is in place, heirs who inherit a loved one’s gun collection could risk running afoul of state and federal laws if they want to, say, sell the firearms, but they aren’t technically the owner of said firearms.
In the event a gun owner becomes incapacitated, the trust could also help relatives or other appointed trustees more easily access the guns to either sell or transfer to another party, or legally hold on to them for safe keeping while the owner of the guns is still living.
If no gun trust is in place, the relative of the gun owner may be breaking federal law, state law, or both, if he or she tries to sell the guns since they may not be in his or her possession legally.
While gun trusts can include any commonly owned guns, people often utilize the trusts as a way to protect guns that are classified under the National Firearms Act, Title II of the Gun Control Act of 1968.
These Title II weapons can include fully automatic weapons (i.e. machine guns), and suppressors, which are more commonly known as silencers, and muffle the sound of the gun.
If no gun trust is in place, the heir to the individual gun owner could be in danger of committing a federal felony if he or she attempts to transfer or even transport these types of nationally regulated weapons and accessories.
While this is not an entirely comprehensive look at gun trusts, it’s at least a place to get you started.
And since, by the latest estimates, there are nearly 395 million firearms in private ownership in the United States, the chances are pretty good that one or two of your clients is a gun owner.
For more information on gun trusts and their specific provisions, make sure to consult with an estate planning attorney who specializes in firearms law.