NFA question...

[GhostofWinter]

OK I am getting ready to take the lunge into the realm of NFA's (yeah I got bit by the NFA bug at the 2010 NFA Day) My question is in regards to Trust or no Trust. What is the difference in the two? I am thinking about the future as well as the present. Which would be the easiest for my kids to inherit the goodies once I am gone?

At this point I would be the ONLY one using the toys or would be present when they are played with. Also can you create a trust later? or would you have to pay the tax stamp fees again? So many questions....LOL

 

[Aszerigan]

I'm waiting for the answers too.

 

[mertbl]

You can create the trust later. But you have to transfer the items to the trust, so another $200. I'm not sure, but I believe the item has to be held at the dealer until the trust is approved to possess the item. Not 100% sure on that part.

You can always add people to the trust later on. That part I don't believe is difficult.

 

[JTinIN]

Just name the kids in the will and they get the guns with no issues (assuming they are old enough and legally have them in the state they live in).

The general rule is easier to go no trust if you can get sign off and are the only one using the guns for the near future.

Myself went with a LLC as the son is 28, also shoots and gives options for current transfer of the toys over time.

 

[CountryBoy19]

The actual NFA process doesn't really change between the 3 main channels of NFA ownership (personal, trust, and llc/company). It's the finer details that vary.

I'll outline some of the advantages/disadvantages below.

Regarding passing the weapons on to your children it doesn't much matter. Your heirs are going to get the weapons tax free on a form 5 no matter what, unless you specifically name somebody else to get them. You don't have to specifically name your heirs to get them in order for them to transfer tax free. The only time a person needs to be named to get a tax-free transfer is if they wouldn't normally be considered an heir, then they need named. Example: You want your son to have your M16, but your best friend to have your AK47. Your son does not need named, the M16 will transfer to him tax-free on a form 5 no matter what. Your best-friend however, will need to pay a transfer tax unless the AK47 was specifically willed to him, in that case it will also transfer on a tax-free form 5.

Personal
Advantage: Easy
cheap

Disadvantages: You're the only person that can possess the firearm.
If your CLEO won't sign-off then you're screwed.

Trust
Advantage: Allows multiple people to possess
Little to no annual maintenance on the trust
Trustees can be changed (want to change who can possess the NFA firearms)
No CLEO signoff or citizenship forms

Disadvantages:
More costly than personal ($35-5,000)

Company
Advantages: You can sell your whole collection off some day with no transfers etc (just sell the whole company, ownership of the firearms doesn't change, ownership of the company does)
Changes are much easier to make and you have a lot more freedom in making those changes depending on how the companies governing documents are written (vs. a trust that has a lot more guidelines)
No CLEO signoffs or citizenship forms

Disadvantages:
Most states require a yearly fee for LLC's etc
Most LLCs are required to file taxes as well
An LLC written to give you the most benefit over a trust will be more costly to have written up.

I know there is more, I did this comparison once before on here, I'll see if I can find the thread.

Check out this thread for more info https://www.indianagunowners.com/forums/class_iii_nfa/84201-nfa_newby_to_trust_or_not_to_trust.html