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We do not recommend allowing friends and family members to purchase NFA firearms using your gun trust. Those who believe that this is a great idea simply do not understand the proper roles of the parties to a gun trust. Fundamentally, there are three parties to a gun trust—the settlor, the beneficiary, and the trustee.
Settlor. The settlor is the owner of all property in the gun trust. If a friend or family member purchases an NFA firearm using your gun trust, he or she made a gift of that NFA firearm to you. You now own that firearm, regardless of the source of the money used to purchase the firearm.
Beneficiary. By creating a gun trust, you, as the settlor, are creating part of your estate plan. Your gun trust has beneficiaries, just like a will. When you die, the beneficiaries of your gun trust will inherit all of the firearms in your gun trust, regardless of the source of the money used to purchase the firearm.
Trustee. The trustee is the person who has the power to use and possess the NFA firearms in the gun trust. When you create your gun trust, you, as the settlor, are the initial trustee of your gun trust. In our gun trust, you can add and remove co-trustees any time you wish. Essentially, a co-trustee is merely an authorized user of your NFA firearms. If a person buys an NFA firearm using your gun trust, you can exclude him or her from being allowed to use or possess the firearm simply by refusing to make him or her a co-trustee or by removing him or her as a co-trustee. Again, the settlor is the owner of all property in the gun trust, regardless of the source of the money used to purchase the firearm.
It may seem like a money-saving technique to use someone else’s trust to purchase NFA firearms, but in the end it is a bad idea. Time and again, we hear from someone who has purchased several NFA firearms using a friend’s gun trust, which also means that he or she paid the $200 transfer tax for each NFA firearm that was transferred to the friend’s gun trust—only to learn that the friend actually owns the firearms. To correct the situation, the person must create a new gun trust and ends up paying $200 per NFA firearm, so he or she can transfer them into the new gun trust. However, the person needs permission from the friend (owner) to allow this to happen.
If you want to own the NFA firearms that you spend your money on, then you need to be the settlor of your own gun trust. When you die, your beneficiaries will inherit the firearms in your gun trust. If you want to be able to share possession of your NFA firearms, the Willi Law Firm gun trust is designed to make it easy for the owner (settlor) to share possession of NFA firearms with other people (co-trustees). If you and your friend want to be allowed to use each other’s NFA firearms, you simply appoint each other as a co-trustee of each other’s gun trust. Importantly, if you and your friend ever part company, you can remove each other as a co-trustee, and walk away from the relationship with the firearms that you bought.
Would you like to have the peace of mind that comes with knowing that you received a high-quality Texas NFA gun trust from a Texas attorney who is recommended by several of the largest Class 3 dealers in Texas? Let’s get started!
The Bottom Line
Total Legal Fees − $300. Debit and Credit Cards Accepted.
Statewide Service − No Office Visit Required
Same-Day Service Normally Available − No Extra Charge