Living Trust vs Firearms Trust???

[The Punisher]

My local class 3 dealer informed me that my Revocable Living Trust can not be used to purchase class 3 items. He said that lots of people use Quicken to make this and that the ATF will only accept "Firearms Trust". This is the first i hear of this and i was wondering if this is true.
Has anyone use quicken willmaker to create their trust and had problems?

Thanks!

[noiseless]

Not saying the guy has no idea what he's talking about, but I used Quicken Willmaker and mine got approved so recently, I got it back yesterday. this is the fourth time I have used it

[joshuap]

You can use a regular revocable trust but it is ill advised. Keep your firearms separate in their own trust. I would caution against using willmaker. You can see the article I wrote here: http://paelderestatefiduciary.blogspot. ... un-in.html

[Vid]

You can use a regular revocable trust but it is ill advised. Keep your firearms separate in their own trust. I would caution against using willmaker. You can see the article I wrote here: http://paelderestatefiduciary.blogspot. ... un-in.html

The article, if I am reading it correctly takes issue with the use of Quicken as opposed to an attorney. Most of the questions regarding the trust itself and concerns have more to do with the legal transfer to benificiaries (sic).

So correct me if I am wrong, but the use of Quicken should by no means be interpreted as wrong, but the legal advice concerning the use of different methods Corp,Personal, or trust has more to do with legal advice then the software having some flaw.

Am I correct in this? I bought 2 suppressors this morning and submitted the full declaration and schedule which shows prior NFA items that I have purchased before they required the entire declaration. I use this trust solely for firearms and there are no other items declared and I have no intent of doing so.

Best,

Kris

[joshuap]

You are mostly correct, if I am reading you response/question correctly. Let me try to clarify. There is no concern with Quicken for a typical revocable trust or will. The issue revolves around firearm trusts which are anything but typical. While the article does deal with the transfer to a beneficiary and/or long term issues, there are issues in general which Quicken will not know. For instance, Quicken could care less if you have a Trustee that is 15 years old, whereas, with a firearms trust, this is a big issue. Also, if the trust isn't properly drafted in all respects, the BATFE could come and take the item as a forfeiture. None of these are flaws in Quicken, per se, but are flaws, which could cause one to lose his/her NFA items.

I believe most attorneys are charging $300-400 for a trust, which after completion, gives you security. It only needs to be done once (unless you want to change it later) and all your future transfer can be done to the trust, without concern. Even if you decide to change it later, the cost should be next to nothing, unless you are completely revamping it to an extreme.

[Vid]

You are mostly correct, if I am reading you response/question correctly. Let me try to clarify. There is no concern with Quicken for a typical revocable trust or will. The issue revolves around firearm trusts which are anything but typical. While the article does deal with the transfer to a beneficiary and/or long term issues, there are issues in general which Quicken will not know. For instance, Quicken could care less if you have a Trustee that is 15 years old, whereas, with a firearms trust, this is a big issue. Also, if the trust isn't properly drafted in all respects, the BATFE could come and take the item as a forfeiture. None of these are flaws in Quicken, per se, but are flaws, which could cause one to lose his/her NFA items.

I believe most attorneys are charging $300-400 for a trust, which after completion, gives you security. It only needs to be done once (unless you want to change it later) and all your future transfer can be done to the trust, without concern. Even if you decide to change it later, the cost should be next to nothing, unless you are completely revamping it to an extreme.

Yes were on the same page, your are trying to make people aware that just tossing software into your computer and tossing names in would not be advisable and that legal advice for those who are unfamiliar with the law or trusts should consider legal advice that could save them much hassle.

Since I used Quicken and have pretty fair firearms knowledge in regards to the law, I was very careful as to who I put on the document as it pertains to age and prohibited persons and such. So I did get concerned when I saw a Firearms trust vs. Revocable trust as I am unaware of a difference as long as the trust is firearms specific.

I think I understand your concerns. I don't see an issue on my end, although I was informed they kicked a couple back for more questions. The only concern I have is that I used benificieries (sic) (2) and one is geographically prohibited, but that I would think is a non issue as the other is not.

Thank you,

Kris

[joshuap]

To answer your question, a firearm trust is a revocable trust, it is just a revocable trust that deals solely with firearms and nothing more. I am somewhat concerned by your statement that you have listed two beneficiaries. How have you taken appropriate steps to handle this? Two people cannot individually own the NFA item at the same time. Just because the one person lives in a state that does not allow such, does not devoid him /her of his/her interest. Moreover, and I hope you understand, a beneficiary cannot possess the item prior to your death (assuming that is the action which causes the interest to vest in the beneficiary). When I say they cannot possess, I mean that they cannot go to the range without the person(s) listed as the Trustee(s) in the Trust. ONLY the trustee(s) can possess the items (I assume you are a trustee).

[Vid]

To answer your question, a firearm trust is a revocable trust, it is just a revocable trust that deals solely with firearms and nothing more. I am somewhat concerned by your statement that you have listed two beneficiaries. How have you taken appropriate steps to handle this? Two people cannot individually own the NFA item at the same time. Just because the one person lives in a state that does not allow such, does not devoid him /her of his/her interest. Moreover, and I hope you understand, a beneficiary cannot possess the item prior to your death (assuming that is the action which causes the interest to vest in the beneficiary). When I say they cannot possess, I mean that they cannot go to the range without the person(s) listed as the Trustee(s) in the Trust. ONLY the trustee(s) can possess the items (I assume you are a trustee).

I am the trustee, and I understand the beneficiaries question. Let me clarify my statement, there are 2 successor trustees. If one is unable or does not want to deal with the issue, the second can step in and take charge or appoint a Trustee.

The actual beneficiaries are the same as the successor trustees, and are to receive proceeds in equal shares, not unlike a will. Being that they are successor trustees, they can pay the tax and liquidate the items and neither is a prohibited person. My only concern when I initially structured it was the geographic location of one of the beneficiaries. But I over ruled that premise as a prohibited person as that person can obviously comply with the law as trustee within the state of the trust. The appropriate steps will be laid out for them under the law, and I would lay out options written step by step and contacts made available should there be an issue and to stay in compliance with the law.

I can however see the need for your article as I have no doubt that some folks may in fact just toss a trust together without thought in order to cut transfer times and cause themselves some very real problems. So these articles even for a know it all like myself are always appreciated.

Thank you,

Kris

[noiseless]

The "prohibited persons" and "Juvenile" issues are great points. One would think that they would be "Common Sense", but hey, some people were rejected for stupider reasons.

[PAR]

I have been told that Sandra Snook is in charge of the determination and, to my knowledge, she has never been to law school, nor obtained a Juris Doctorate. Thus, the BATFE could be in REAL deep water doing such...

I spoke to Sandra a few months back concerning my second transfer, she is not the trust approving authority. BATFE has a staff attorney that has been reviewing them. Now is this happening 100% of the time, probably not but are the examiners working under their direction, probably so.

You bring up several go points which everyone should consider when constructing their trust; however, Quicken still works for those who don't want to shell out $300 plus for attorney; especially, for a $300 item.

Now back to the OP question - your dealer is mistaken, BATFE hasn't published a ruling on rather you need a firearm trust only.

[joshuap]

Working under an attorney's direction means nothing. It is still practicing law without a license. The ONLY exception is that in some states, if the person is in law school, and is working under the supervision of an attorney, then he/she can, in essence, practice law without a license.

[The Punisher]

Ok, I undertand your point. So, should i not use Quicken Willmaker? If so, how do i know i did it correctly. I do not have an extra $350 to give to a lawyer who will basically use a similiar program to generate my trust.
How can i setup my trust on Quicken and how can i be sure its correct?

[joshuap]

No one can tell you, because to do so would be practicing law without a license. People can only speak in hypos and actual rules and regs. Not trying to be negative, but $350 will be the least of your concerns if the BATFE comes knocking that you have unlawful possession of a firearm. No attorney will be using a program to make a firearm trust...no such program exists, nor would it be cost effective.

[ArevaloSOCOM]

Ok, I undertand your point. So, should i not use Quicken Willmaker? If so, how do i know i did it correctly. I do not have an extra $350 to give to a lawyer who will basically use a similiar program to generate my trust.
How can i setup my trust on Quicken and how can i be sure its correct?

Quiken willmaker has worked for tons of people.

As for knowing if you did it right, the BATFE is checking them over.

If you set up up ok, you'll have a silencer to show for it.

I had lawyer set up 2 trusts for me, a real one and a NFA one.

Since my wife is his paralegal, he did it for free/cheap.

But Quiken willmaker has worked for many people with little problems.

If you do screw something up the BATFE will let you know if it's something that matters to them.

Do it now.

YOU WILL NOT REGRET IT.


As for your dealer, he's wrong..................it doesn't have to be a "firearms" trust.

[The Punisher]

Thanks for all of the replies. I guess i'll just give it a shot myself, if it works then i saved $350. If not then i guess i'll find out. I dont have anything to put on the trust yet but i plan on changing that soon.

[joshuap]

If you screw up, you are looking at up to 10 years in jail and up to $250,000 in fines. $350 isn't so much in that context...

[Vid]

If you screw up, you are looking at up to 10 years in jail and up to $250,000 in fines. $350 isn't so much in that context...

Not if they issue the stamp on a legitimate trust and legal document, there is no intent unless the trustee is a prohibited person by definition.

[joshuap]

WRONG. Do not tell people that which you do not know. There are a bunch of ways you could be found to be in unlawful possession of the weapon with a trust if not properly drafted. Also, if you think a legitimate approved transfer will always be deemed legitimate by the BATFE, think again. Go on http://www.nfaoa.org and go to the resources page and read about Mr. Napollili. He had a legitimate form 4 (stamp and signature), they acknowledged that the form was legitimate (not forgery), and they deemed it contraband. While it is possible that a court would not have held such, he dropped the case due to threats.

[chrismartin]

What in the default printed current version of Willmaker with the seltor(s)/trustee(s) still living and "possessing" an NFA device would cause the trust or possession to be unlawful?

Obviously there are issues with Willmaker wrt future issues (deaths, trustees, ages, etc) that you brought up in your article, but I'm interested in the faults of a standard printed trust from willmaker instantly making something wrong.

Could a lawyer "fix" a quicken willmaker trust that already contains NFA items without re-paying the $200 tax?

[joshuap]

Any trust can me modified. For purposes of the registration, so long as the name of the trust remains the same, you do not need to pay the $200 tax for each item or even re-register for that matter. Even if you do change the name, you *may* with certified affidavits be able to get the BATFE to change the registered name, but I wouldn't hold my breath. I say this, because the BATFE needs to be able to handle name changes (due to marriage, or people just wanting to change his/her name).

If you read my article, you should be able to pick up on some of the ways that a person can be found to be in illegal possession. An example of such is not knowing who can legally possess the weapon in the trust. A settlor cannot possess it, because it now belongs to the trust. The beneficiary also cannot possess it, until the interest vests, which, in most instances applicable here, will be the demise of the trust.

[chrismartin]

I wish you or Bob in FL were in VA, I'd have no problem handing over some cash to whip something up

[ArevaloSOCOM]

If you screw up, you are looking at up to 10 years in jail and up to $250,000 in fines. $350 isn't so much in that context...

Not if they issue the stamp on a legitimate trust and legal document, there is no intent unless the trustee is a prohibited person by definition.

+1

Don't be scared.

Just do it.

[Vid]

WRONG. Do not tell people that which you do not know. There are a bunch of ways you could be found to be in unlawful possession of the weapon with a trust if not properly drafted. Also, if you think a legitimate approved transfer will always be deemed legitimate by the BATFE, think again. Go on http://www.nfaoa.org and go to the resources page and read about Mr. Napollili. He had a legitimate form 4 (stamp and signature), they acknowledged that the form was legitimate (not forgery), and they deemed it contraband. While it is possible that a court would not have held such, he dropped the case due to threats.

Sir,

Could you please stick to the Trust itself, were not talking about war trophies or heirs of veterans. We are talking about a trust. If the trust is legally recognized and the persons submitted on the trusts are not prohibited persons under the law. Whether or not the firearm is handled in a correct manner as it pertains to the trustee is no different than if it were privately owned.

Its the trust, I believe you are fear mongering and probably an attorney who feels slighted for not cashing in on trust documentation. Show me the trust issues other than prohibited persons and mishandling or wrongful possession in transport or whatever.

What is your issue?

[Vid]

This unusual case arises from two issues---ATF's loss of all its NFRTR records of a registered NFA firearm, and ATF's later interpretation that the firearm was contraband. Both issues were beyond control of the owner, to whom ATF had approved a valid Form 3 transfer. The NFRTR issue is straightforward, as ATF states: " . . . ATF had no record of registration of the MP40 machinegun to Mr. Napolilli or any other person." The larger issue arises from an apparently informal practice, during the early 1980s, of getting unregistered machineguns off the street by some ATF Special Agents instructing Class II manufacturers to "manufacture" them and file Forms 2 to register them. This little-discussed but widely known practice within the Class III industry may involve as many as 20,000 machine guns currently owned by people who have no way of knowing that these firearms are contraband, or any means of rendering them legal to possess. Mr. Napolilli's letter to the Congress and copy of Noel E. Napolilli vs. United States of America (U.S.D.C., D. Alaska, Case No. Civ. F93-37), are published in TREASURY, POSTAL SERVICE, AND GENERAL GOVERNMENT APPROPRIATIONS FOR FISCAL YEAR 1999. 105th Congress, 2nd Session. PART 5: STATEMENTS OF MEMBERS OF CONGRESS AND OTHER INDIVIDUALS AND ORGANIZATIONS. Washington, D.C.: U.S. Government Printing Office, 1998, pages 33-39; the "Declaration of Noel E. Napolilli" and ATF's "Laboratory Report" dated March 2, 1993, is published in TREASURY, POSTAL SERVICE, AND GENERAL GOVERNMENT APPROPRIATIONS FOR FISCAL YEAR 2000. 106th Congress, 1st Session. PART 5: MEMBERS OF CONGRESS AND OTHER INTERESTED INDIVIDUALS AND ORGANIZATIONS. Washington, D.C.: U.S. Government Printing Office, 1999, pages 82-87. ATF's April 11, 2005, letter to Mr. Napolilli, and its letter dated September 18, 1992, to attorney James H. Jeffries III, are unpublished. To read James H. Jeffries' article, "Owners of 'Remanufactured' Guns Beware," click here.

http://www.nfaoa.org/documents/jim1.txt


Show me the relevance to a trust please.

[Vid]

In a letter dated September 18, 1992, then-NFA Branch Chief Wayne Miller advised attorney James H. Jeffries, III that until his client, Noel Napolilli, produced a Form 3, "ATF had no record of registration of the MP40 machinegun to Mr. Napolilli or any other person." This letter may be cited as "Letter from Wayne Miller, Chief, NFA Branch, to James H. Jeffries, III dated September 18, 1992."

This ATF letter is significant because it meets a standard set by the Department of Justice in 1979 that "a particular individual or weapon is registered" and ATF finds that its "files are missing," then "the only solution would be to declare another amnesty period" (see "Response to Senator [James A.] McClure," by Philip B. Heymann, Assistant Attorney General, and Lawrence Lippe, Chief, General Litigation & Legal Advice Section, Criminal Division, U.S. Department of Justice, November 29, 1979, LL:JJD:ajw, page 4); click here to read this document. Interestingly, a June 2007 report by the Department of Justice Office of Inspector General found that firearm registration documents missing from the NFRTR is apparently generalized and a routine event: "If the NFA weapons owner [sic] can produce the registration paperwork, ATF assumes the error is in the NFRTR and fixes it in the database" (DOJ-OIG Report Number I-2007-006, page 31); click here to read this document. Thus, it appears only to be a matter of time before the Attorney General will authorize a new amnesty period to render the NFRTR accurate and complete.

The background of this case is that during a routine compliance inspection, ATF encountered several NFA firearms owned by Noel Napolilli of Fairbanks, Alaska, that ATF alleged were not registered in the NFRTR. ATF eventually determined that all of the firearms were registered except for an MP-40 machine gun bearing serial number 4212; and although Mr. Napolilli had a copy of an approved Form 3 for the firearm issued by ATF, ATF claimed the document was a forgery because there was no computerized or hard copy record of the MP-40 in the NFRTR. ATF was later forced to withdraw that allegation after ATF's own forensic document laboratory determined that the Form 3 issued to Mr. Napolilli was a copy of a Form 3 that ATF created. ATF then changed tactics and alleged that the firearm was contraband because it bore the name of an Ohio manufacturer and no evidence the gun had been remanufactured although (as attorney James Jeffries pointed out), ATF had itself lost or destroyed the very documentation that could have unambiguously settled the issue. Mr. Jeffries wrote an article entitled "Owners of 'Remanufactured' Guns Beware!" (click here to read it), summarizing the legal issues from his perspective as Mr. Napolilli's attorney.

Mr. Napolilli's account of what happened has been published in Congressional hearing records, in the statements of Eric M. Larson, posted elsewhere on this site and linked here for convenience of reference. In a letter dated February 19, 1998, Mr. Napolilli contacted Rep. Jim Kolbe, then Chairman of the Subcommittee on Appropriations, House of Representatives to inform him of his experience and included a copy of his Declaration filed in United States District Court for the District of Alaska at Fairbanks (see 1998 statement, pages 33-39); click here to read these documents. Mr. Napolilli further submitted a Declaration describing how ATF initially claimed his Form 3 was a forgery, but was forced to retract that allegation when ATF's own forensic document laboratory examined the Form 3 and determined it was genuine (see 1999 statement, pages 82-84; a copy of the ATF laboratory report is on page 87); click here to read these documents. Finally, on November 19, 1999, ATF executives Walfred Nelson, Kent M. Cousins, Gary Schaible and representatives from ATF's offices of Legislative Affairs and Chief Counsel, told Jeff Ashford, Staff Assistant, Subcommittee on Treasury, Postal Service, and General Government Appropriations, and a staff member of the Committee on Government Reform, House of Representatives, that ATF had lost all of its documentary and computer files for Mr. Napolilli's MP-40 (see 2001 statement, page 13; click here to read it).