• Proposed Changes to Gun Trust Rules.

     

    Last Updated Jan, 2017

     

     

     

     

    Don’t forget to read our Frequently Asked Questions:

     

    F.A.Q.s

    Intro

    There is a lot of information out there regarding the changes to the rules, so we decided to sift through all of it and provide you with what we think is the best reading material on the web. We’ve summarized most of it for you here, but we recommend you also read the content that we link to from this page.

    History

    • September 9, 2013: BATFE proposed changes to the existing rule, subjecting the rule to a 90-day period before any changes could be made, to allow comments on the proposed changes to be filed.
    • December 9, 2013: The 90-day comment period ended. Nearly 10,000 comments were filed. BATFE estimated they would implement the rule-change in June, 2014.
    • June, 2014: BATFE’s did not implement the rule-change,  and postponed their estimate until January, 2015.
    • January, 2015: BATFE again postponed their expected rule-change until May, 2015.
    • January, 2016: BATFE Announced the final rule change. It will take effect in 180 days. (Here is the rule and an article about it.)
    • July, 2016. Rule went into effect.

     

    Original Post from September 2013 below:

    Most Important things to know:

    1. Current owners of NFA items, whether owned in a trust or in their personal names, should not be affected. The changes will most likely apply only to new transfers. No one knows for sure, but most commentators seem to agree on this point.

    2. Perhaps most important to remember is that currently, these are only proposals. Once a proposed rulemaking is published for public comment, the public has a minimum of 90 days to comment on the rule (for more on how you can get involved in this process, see below). At that point, the ATF will read and process the comments and either abandon the rulemaking, revise it, or publish it as a final regulation. Because the changes will almost certainly be prospective, they shouldn’t affect existing Forms 1 and 4 that have already been submitted by the date the regulation becomes final. You can still buy NFA items using trusts without needing a CLEO signature until this proposed rulemaking goes through (if it ever does). That means you still have an less than 30 days to get this done. If you’ve been toying with the idea of getting a suppressor, short barrel, or other NFA item, depending on where you live, you could be running out of time. Click here to get started.

    3. The proposed changes do not outlaw or eliminate gun trusts. Trusts are recognized as a legitimate method of owning NFA items by the NFA statute itself, which is not changing, and which neither the President, the Attorney General, nor ATF can change. The statute can only be changed by Congress.

    [Cite:  Zachary B. Setzer, North Carolina Lawyer.]

    The rule-changing process.

    The president has been pressuring the BATFE to amend the rules regarding Gun Trusts and NFA Trusts. The BATFE issued a rule change proposal to the White House, on August 20th, but formally announced it on September 9th  for a 90-day review period. During this review period, the public and summit comments on the rule, which the BATFE will consider before it submits its final draft of the rule.

    No one knows what will happen to applications that are pending when the rule changes, but many predict that any new rules would not retroactively affect applications already pending BATFE approval.

    The actual proposal.

    It is 16 pages long, but if you really want to know what is going on, this is the best and only way. You only need to read the first 7 pages, and we have highlighted the important parts so you can skim quickly and easily.

    This is the actual proposed rule:  CLICK HERE TO VIEW THE HIGHLIGHTED PROPOSAL.

    If you would like the un-highlighted, and original version- it is here: http://www.gpo.gov/fdsys/pkg/FR-2013-09-09/pdf/2013-21661.pdf

     

     Summary:

    “The proposed regulations would,” according to the Office of Information and Regulatory Affairs, “(1) add a definition for the term “responsible person”; (2) require each responsible person of a corporation, trust or legal entity to complete a specified form, and to submit photographs and fingerprints; (3) require that a copy of all applications to make or transfer a firearm be forwarded to the chief law enforcement officer (CLEO) of the locality in which the maker or transferee is located; and (4) modify the requirement for a certification signed by the CLEO.”

    Basically, it would close the “loophole”, which allows NFA Trusts to be transferred a NFA firearm without a) fingerprints, b) photos, or c) the CLEO signature.

    For a longer summary read this http://thehill.com/blogs/regwatch/pending-regs/318133-white-house-reviewing-draft-gun-control-rule

    And read this as well as all the links within this article: http://www.examiner.com/article/divergent-views-emerging-on-atf-gun-trust-rulemaking

    So are Gun Trusts over?

    No.

    First, the rule change is only in the proposal state so no one know what the actual rule change will be. While the proposal makes no mention of how it will implement the change, (i.e. Will this effect pending Form 4 Transfers to gun trusts? etc.), those who want a gun trust should act quickly.

    Further, The ATF Proposal doesn’t entirely close the “loophole”.  Imagine the following scenario. Two people form a trust. Then, that Trust applies to the ATF for approval of a transfer of an ATF firearm. This would require that both people submit fingerprints, photos and CLEO signatures. Once the transfer is approved, the Trust is amended to add more Trustees, who would have the same rights to the Trust’s property as the original two members. The late-added persons would effectively bypass the requirements. The ATF addresses this partially on page 7 by stating:

    “ATF recognizes that the composition of the responsible persons associated with a trust . . . may change, and is considering a requirement that new responsible persons submit [a form with fingerprints, photos and CLEO signature] within 30 days of the change. ATF seeks comments on this option and solicits recommendations for other approaches.”

    The final draft might address this issue, but regardless of the proposed rules, a trust will continue to be a valuable estate plan to help a beneficiary lawfully, safely, and privately inherit an entire gun collection without a court proceeding.

    Lastly, even if the rule requires all ‘responsible parties’ to undergo heightened scrutiny, a trust will still enable more-than-one person to collectively own a Title II item. In other words, while an individual silencer owner cannot let a friend borrow it to go to the range, they could if they were both co-trustees of the trust that owned it.

    Comments worth reading.

    By far the most comprehensive comments drafted in opposition to the proposal have been by submitted by the  Firearms Industry Consulting Group, a division of Prince Law Offices, P.C.

    The comments are long and comprehensive, and we did not highlight or summarize, but you can read them here:
    http://nfafirearmstrust.com/files/2013/11/Guntrustlawyer-41P-comments2.pdf

    There are exhibits and attachments, which can be found here:
    http://nfafirearmstrust.com/files/2013/11/GuntrustLawyer-Exhibits-to-41P.pdf

    Both of those are big PDFs, so you may want to “right click–> save file as ” to download.

     

    Conclusion, more information.

    Please email us with other questions that you can’t seem to find the answers too, and we’ll write on those topics.

    If you know more details, or have a great article that we’ve missed, please email us as well.

    info@NFAFirearmsTrust.com

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