So I stopped by my FFL today to full out a Form 4 and he advised me to open a checking account and pay the stamp tax with a check from the account so there is a paper trail. I guess it would be to prove that the trust is not just for acquiring a NFA item. My problem with that is - that's exactly what the trust is for! I am not going to open an account just to try to mislead the BATFE. Has anyone else done this or been advised to do it? I am guessing that my personal check will clear just fine.
Suppressors NFA Trust bank account?
- Thread starter HawkDriver
- Start date
It's not misleading its just taking yourself a little further from the microscope in case they do ever decide to track all registered weapons and items down.. the paper trail wouldn't lead directly to you.. it would go to the trust...first... Or so it was explained to me...
It's not to mislead. It is done to tighten up the trust. Much as a corperation is not allowed to be personally funded, it needs to be done by a short term loan. If a corperate officer puts personal money into a corperation without loan papers to prove, they risk loosing the corperate shield that protects thier personal assets. It was my understanding when my lawyer explained, that by setting up the trust checking account, you are paying for NFA items by the trust for the trust, even though you are funding that account. It's not nessesary, just recomended.
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The way i understand it is this: you purchase the can then put IT into the trust = transfer requiring a stamp because you owned it before the trust did. Trust buys the can from the dealer and there is only one transfer. Meaning if the ATF wanted they could say that by buying the can and then transferring it to the trust you evaded the transfer. I have no knowledge of them pursuing anyone for this but its usually free to set up an account.
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Seems like a lot of extra steps to take if you are listed as the beneficiary and guarantor of the trust with my address and my name on the check. And until the form 4 clears the FFL legally owns it so they can't tax you twice if you set up the trust and file the form 4 with that name, can they? Seems like the type of thing that would have everyone raising hell.
It actually doesn't sound like that much extra work. Set up an account for the trust, and when you wanna buy some goodies you could make a deposit, and write the check. Or I would deposit a small amt each week and let it accumulate.
Although I'm not goin NFa for some time, I think it might be a good idea to go ahead and get me a trust and acct set up (and let funds accumulate) so when I get ready for that sbr I can write the check and be done.
Although I'm not goin NFa for some time, I think it might be a good idea to go ahead and get me a trust and acct set up (and let funds accumulate) so when I get ready for that sbr I can write the check and be done.
I do this, setup a free online account in the name of my trust. All I had to do was provide the certification of trust papers (NOT the actual trust) and it was done. I then transferred funds from my checking acct into the trust account. A week later I had checks with "dvdt trust" and "dvdt, trustee" written on them. Then I use those funds to purchase the item, pay for any transfers and send the ATF their $200 fee.
Piece of cake!
The only hassle I had was when I was at my bank trying to open the acct. The lady kept asking me what the trust is for and I repeated myself 3x that it was a private matter in nature.
Piece of cake!
The only hassle I had was when I was at my bank trying to open the acct. The lady kept asking me what the trust is for and I repeated myself 3x that it was a private matter in nature.
here is some of the instructions and info I got when doing my trust.....
1. How to Purchase and Pay for Items in the Trust
We strongly recommend purchasing any NFA restricted items in a bank account owned by
the trust to avoid the potential allegations that the paperwork does not comply with the actual
transaction. Although it is possible to properly document the purchase of these items without a bank
account, the risk of the potential exposure to criminal charges is increased significantly unless a bank
account is used.
2. Accounts: Bank, Brokerage, Money Market, Credit Union, and Mutual Funds
You may create a new bank account in the name of the Trust. We would recommend
creating a bank account in your Trust’s name to make purchases. This will show a clear chain of
title from the previous owner of the firearms to your trust.
You may also change the name on a previously opened bank, brokerage, money market,
credit union, or mutual fund account (referred to in this Section as an "account" or as "accounts")
that you wish to be owned by the Revocable Trust, but we do not recommend this.
Some clients have decided not to open a trust checking account because of the account fees
charged by their local bank. There are several options to avoid these fees. First, consider looking
for a free internet checking account. For example, in Colorado, FirstBank offers this kind of
account. See https://www.efirstbank.com/business/checking/. In many other states, Compass Bank
offers free checking accounts: http://www.bbvacompass.com. Check with your current bank for
more options.
If you cannot find a free checking account for a revocable trust, consider a savings account
with limited check writing privileges or a debit card. Another option is a standard savings account
and having the bank issue cashier's checks when you need to purchase an item.
3.What if the Bank or Credit Union says they don't allow Revocable Trust Accounts?
Some banks and credit unions don't allow their customers to open Revocable Trust accounts.
Often the problem is that the person you are talking to does not realize the bank really does allow
you have a trust account, so the solution may be as simple as talking to another more senior person at
the bank. If it turns out that you are definitely not able to have a trust account there, you can either
open your account at a bank which does have trust accounts, or you can set the account up as a Joint
Tenants With Rights of Survivorship account or as a Payable on Death account so that the account
will pass directly to the surviving joint tenant or to the named beneficiary without having to go
through probate. Of course, if an account does pass directly to a person, it is possible that the
planning contained within your Revocable Trust may be nullified or disrupted.
1. How to Purchase and Pay for Items in the Trust
We strongly recommend purchasing any NFA restricted items in a bank account owned by
the trust to avoid the potential allegations that the paperwork does not comply with the actual
transaction. Although it is possible to properly document the purchase of these items without a bank
account, the risk of the potential exposure to criminal charges is increased significantly unless a bank
account is used.
2. Accounts: Bank, Brokerage, Money Market, Credit Union, and Mutual Funds
You may create a new bank account in the name of the Trust. We would recommend
creating a bank account in your Trust’s name to make purchases. This will show a clear chain of
title from the previous owner of the firearms to your trust.
You may also change the name on a previously opened bank, brokerage, money market,
credit union, or mutual fund account (referred to in this Section as an "account" or as "accounts")
that you wish to be owned by the Revocable Trust, but we do not recommend this.
Some clients have decided not to open a trust checking account because of the account fees
charged by their local bank. There are several options to avoid these fees. First, consider looking
for a free internet checking account. For example, in Colorado, FirstBank offers this kind of
account. See https://www.efirstbank.com/business/checking/. In many other states, Compass Bank
offers free checking accounts: http://www.bbvacompass.com. Check with your current bank for
more options.
If you cannot find a free checking account for a revocable trust, consider a savings account
with limited check writing privileges or a debit card. Another option is a standard savings account
and having the bank issue cashier's checks when you need to purchase an item.
3.What if the Bank or Credit Union says they don't allow Revocable Trust Accounts?
Some banks and credit unions don't allow their customers to open Revocable Trust accounts.
Often the problem is that the person you are talking to does not realize the bank really does allow
you have a trust account, so the solution may be as simple as talking to another more senior person at
the bank. If it turns out that you are definitely not able to have a trust account there, you can either
open your account at a bank which does have trust accounts, or you can set the account up as a Joint
Tenants With Rights of Survivorship account or as a Payable on Death account so that the account
will pass directly to the surviving joint tenant or to the named beneficiary without having to go
through probate. Of course, if an account does pass directly to a person, it is possible that the
planning contained within your Revocable Trust may be nullified or disrupted.
Yes, your trust should first have its own bank account. NFA items should then be purchased with funds from the account. This way you can prove chain of title of the items and prevent any potential allegations that the claimed transaction (purchase by a trust) does not comply with the actual transaction.
This is great information, just got my trust and I will follow these guidelines. Thanks everyone!
I had an attorney who specializes in Class 3 stuff draw up my NFA trust. It was made strictly as a NFA trust and nothing more. Schedule A has all the stamped items on there along with a dollar bill.
I've never heard about opening a bank account for NFA stuff. I have 4 stamps and 3 of the 4 were done with USPS Money Orders. Yeah you can't see when they cashed it but I haven't had a problem yet with the transactions. All were done right at the 6 month mark. This was pre-2012 election.
I've never heard about opening a bank account for NFA stuff. I have 4 stamps and 3 of the 4 were done with USPS Money Orders. Yeah you can't see when they cashed it but I haven't had a problem yet with the transactions. All were done right at the 6 month mark. This was pre-2012 election.
Still yet to see a single case of a NFA Trust account being needed, or any legal action that suffered/gained because of it.
If you are using an account because you think they don't know you own guns/NFA then you got alot to learn about our .gov.
If you are using an account because you think they don't know you own guns/NFA then you got alot to learn about our .gov.
At the advice of my dealer, I went with the separate bank account for the trust. As I said in an earlier thread over this same topic, since the trust owns the NFA item, the trust should pay for the NFA item. It's not about hiding possession from the government or any other tin-foil hat antics. It's like when I have purchased assets for my company...I'm an owner of the company, so it's my money that pays for it anyway, but I don't write a personal check for it. I view my NFA trust the same way. In the long run, it probably doesn't make a bit of difference, though.
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I don't think you should be listed as the grantor and the beneficiary, based on my lawyers advice. Also I set up the trust not to hide anything from the gov, but to make it legal for the other trust members to handle or dispose of the can in the event of my death. I didn't want to put them in legal jepoardy if I died.
When I say beneficiary I actually meant trustee. There are co beneficiaries within the trust. In the event of my death, there is a clear chain that the property will follow. What legal trouble would it be?
I was advised to avoid purchasing NFA items for the trust with a personal checking account or credit card. I was advised to open a trust checking account or to use a money order to purchase NFA items.
As far as paying for the tax stamp, the lawyer explained that form 4 is technically a tax return and the BATFE does not care who actually pays the tax, as long as the tax is paid.
Technically it is the transferor (the registered owner of a firearm) that is applying to transfer the NFA item to the transferee (the person or entity acquiring the NFA firearm)...
This statement appears on form 4 immediately below section 3C:<o
></o>
The above-named and undersigned transferor hereby makes application as required by Section 5812 of the National Firearms Act to transfer and register the firearm described below to the transferee.<o></o>
Tax returns are confidential documents. The transferor needs to circle ‘I Do’ in section 9 in order for the transferee to be able to check on the status of the transfer with the BATFE:
9. Consent to Disclosure of Information to Transferee (See instruction 8) . I Do or Do Not (Circle one) Authorize ATF to Provide Information Relating to this Application to the Above-Named Transferee.
<o></o>
Instruction 8:
Status Inquiries and Questions. Information relating to the NFA and other firearms laws is available at the ATF Internet website at www.atf.gov . Any inquiry relating to the status of an application to transfer an NFA firearm or about procedures in general should be directed to the NFA Branch at (304) 616-4500. Please be aware that any dissemination by ATF of information relating to the application to register an NFA firearm must conform with the restrictions in 26 U.S.C. § 6103. The opportunity provided in item 8 to authorize ATF to disclose information is intended to enable ATF to respond to inquiries by the transferee regarding the application. The failure to complete item 8 will be considered a declination of authorization to release the information.
Here is a portion of the relevant IRS Code:
26 U.S.C. § 6103
§ Section 6103. - Confidentiality and disclosure of returns and return information
(a) General rule
Returns and return information shall be confidential, and except as authorized by this title -
(1) no officer or employee of the United States, ... shall disclose any return or return information obtained by him in any manner in connection with his service as such an officer or an employee or otherwise or under the provisions of this section. For purposes of this subsection, the term ''officer or employee'' includes a former officer or employee. <
(b) Definitions
For purposes of this section -
(1) Return
The term ''return'' means any tax or information return, declaration of estimated tax, or claim for refund required by, or provided for or permitted under, the provisions of this title which is filed with the Secretary by, on behalf of, or with respect to any person, and any amendment or supplement thereto, including supporting schedules, attachments, or lists which are supplemental to, or part of, the return so filed.
(2) Return information
The term ''return information'' means -
(A) a taxpayer's identity, the nature, source, or amount of his income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments, or tax payments, whether the taxpayer's return was, is being, or will be examined or subject to other investigation or processing, or any other data, received by, recorded by, prepared by, furnished to, or collected by the Secretary with respect to a return or with respect to the determination of the existence, or possible existence, of liability (or the amount thereof) of any person under this title for any tax, penalty, interest, fine, forfeiture, or other imposition, or offense,
...
(3) Taxpayer return information
The term ''taxpayer return information'' means return information as defined in paragraph (2) which is filed with, or furnished to, the Secretary by or on behalf of the taxpayer to whom such return information relates.<o></o>
As far as paying for the tax stamp, the lawyer explained that form 4 is technically a tax return and the BATFE does not care who actually pays the tax, as long as the tax is paid.
Technically it is the transferor (the registered owner of a firearm) that is applying to transfer the NFA item to the transferee (the person or entity acquiring the NFA firearm)...
This statement appears on form 4 immediately below section 3C:<o
></o>The above-named and undersigned transferor hereby makes application as required by Section 5812 of the National Firearms Act to transfer and register the firearm described below to the transferee.<o
></o>Tax returns are confidential documents. The transferor needs to circle ‘I Do’ in section 9 in order for the transferee to be able to check on the status of the transfer with the BATFE:
9. Consent to Disclosure of Information to Transferee (See instruction 8) . I Do or Do Not (Circle one) Authorize ATF to Provide Information Relating to this Application to the Above-Named Transferee.
<o
></o>Instruction 8:
Status Inquiries and Questions. Information relating to the NFA and other firearms laws is available at the ATF Internet website at www.atf.gov . Any inquiry relating to the status of an application to transfer an NFA firearm or about procedures in general should be directed to the NFA Branch at (304) 616-4500. Please be aware that any dissemination by ATF of information relating to the application to register an NFA firearm must conform with the restrictions in 26 U.S.C. § 6103. The opportunity provided in item 8 to authorize ATF to disclose information is intended to enable ATF to respond to inquiries by the transferee regarding the application. The failure to complete item 8 will be considered a declination of authorization to release the information.
Here is a portion of the relevant IRS Code:
26 U.S.C. § 6103
§ Section 6103. - Confidentiality and disclosure of returns and return information
(a) General rule
Returns and return information shall be confidential, and except as authorized by this title -
(1) no officer or employee of the United States, ... shall disclose any return or return information obtained by him in any manner in connection with his service as such an officer or an employee or otherwise or under the provisions of this section. For purposes of this subsection, the term ''officer or employee'' includes a former officer or employee. <
(b) Definitions
For purposes of this section -
(1) Return
The term ''return'' means any tax or information return, declaration of estimated tax, or claim for refund required by, or provided for or permitted under, the provisions of this title which is filed with the Secretary by, on behalf of, or with respect to any person, and any amendment or supplement thereto, including supporting schedules, attachments, or lists which are supplemental to, or part of, the return so filed.
(2) Return information
The term ''return information'' means -
(A) a taxpayer's identity, the nature, source, or amount of his income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments, or tax payments, whether the taxpayer's return was, is being, or will be examined or subject to other investigation or processing, or any other data, received by, recorded by, prepared by, furnished to, or collected by the Secretary with respect to a return or with respect to the determination of the existence, or possible existence, of liability (or the amount thereof) of any person under this title for any tax, penalty, interest, fine, forfeiture, or other imposition, or offense,
...
(3) Taxpayer return information
The term ''taxpayer return information'' means return information as defined in paragraph (2) which is filed with, or furnished to, the Secretary by or on behalf of the taxpayer to whom such return information relates.<o
></o>
Consult the attorney who drew up your trust.
You shouldn't need a separate account. Your trust should have a page called "Appropriations of Funds" (or something to that effect; mine isn't in front of me right now). It basically lists when you, or someone else, "lent/gave" the trust the money to buy the items. It isn't a loan. The trust bought the items. The trust owns the items. You, as a primary trustee, can use/possess/etc the items the trust owns.
If you seriously think you have to be sneaky to somehow disguise where the money came from, then you need to have your trust paperwork examined by a professional. On-line trust documents "might" pass a screening by an "examiner" at the BATFE, but that doesn't guarantee it'll pass scrutiny by a Federal Prosecutor trying to send you to jail...
You shouldn't need a separate account. Your trust should have a page called "Appropriations of Funds" (or something to that effect; mine isn't in front of me right now). It basically lists when you, or someone else, "lent/gave" the trust the money to buy the items. It isn't a loan. The trust bought the items. The trust owns the items. You, as a primary trustee, can use/possess/etc the items the trust owns.
If you seriously think you have to be sneaky to somehow disguise where the money came from, then you need to have your trust paperwork examined by a professional. On-line trust documents "might" pass a screening by an "examiner" at the BATFE, but that doesn't guarantee it'll pass scrutiny by a Federal Prosecutor trying to send you to jail...
No, your trust does not need its own bank account. I have 3 form 4s you can look at that were approved with no problem with personal checks. Any trustee in the trust can purchase things in the name of the trust. That is what the schedules are for.
I switched gears on you by posting answers to 2 different posts. I was referring to Stalking Rhinos post regarding why I set up a trust (potential legal issues for my family if they possessed a suppressor that was in my name only).
Absolutely set up a non-interest earning checking account strictly for your trust because yes, you do want to create a very clear paper trail of where the money came from. Pay for your purchases, stamps and transfers with this checking account.
This is like the IRS and the rest of government - you can submit something and make a mistake and they will let you, only to come back later and attempt to penalize you for it. The lawyer who drew up my trust made it very clear that the #1 issue that gets people in trouble with the ATF when using a trust is where did the money come from. Do not use cash or any personal money outright. You have the right as a citizen to fund the trust with your personal money so as to be able to purchase NFA items, but you can not buy NFA items with personal money outright if the trust is going to own them.
Yes, sounds like a lot of bullshit because it is legal bullshit. Just like you give money to charity, you can give money to the trust. The trust buys the items with its own funds and it owns the item - NOT YOU. You are the sole caretaker of the trust and have the right to purchase/sell items on its behalf and use those items. But if you buy items for the trust with your personal money outright that is looked at as an illegal transfer of the item.
This is like the IRS and the rest of government - you can submit something and make a mistake and they will let you, only to come back later and attempt to penalize you for it. The lawyer who drew up my trust made it very clear that the #1 issue that gets people in trouble with the ATF when using a trust is where did the money come from. Do not use cash or any personal money outright. You have the right as a citizen to fund the trust with your personal money so as to be able to purchase NFA items, but you can not buy NFA items with personal money outright if the trust is going to own them.
Yes, sounds like a lot of bullshit because it is legal bullshit. Just like you give money to charity, you can give money to the trust. The trust buys the items with its own funds and it owns the item - NOT YOU. You are the sole caretaker of the trust and have the right to purchase/sell items on its behalf and use those items. But if you buy items for the trust with your personal money outright that is looked at as an illegal transfer of the item.
Please have your lawyer get in touch with me with the court case numbers, perhaps after all these years of searching we found a lawyer that ACTUALLY has documentation on this, I seriously doubt it though!
According to the BATFE there has NEVER been a single case of anyone getting in trouble with them based on WHERE the money came from or WHO paid for any NFA item. This is why often dealers pay the tax stamp or other individuals can pay the stamp. They have not gone after a single trust based on how the tax or the item was paid for.
There are tens(if not hundreds) of thousands out there that have been paid like this and not a single issue.
This is the same BS that the NFA trust lawyers spout without a single case as justification, but it does help sell trusts after all...its a scare tactic and nothing more.
Please show me where by the individual purchasing the item and it being registered to the trust that it is an illegal transfer of the item, if its that clear cut there will be code explaining it.
Bought my buddy a handgun, he picked it out, he did the paperwork and I paid for it......no illegal transfer there nor any ownership rights on my part......its the same scenario.
I paid an attorney for their legal advice because I don't know and if he says do it this way then that is what I do. Kind of silly not to, don't you think? His BS about the bank account didn't help sell me on a trust and quite frankly I don't see how suggesting a separate account would sell anyone on a trust. What scare tactic and to what point? Is he getting a kick-back from the bank? So why does he care if I set up a bank account or not? It doesn't benefit him in any way if I do it or not.
If you haven't noticed, two different lawyers will interpret the same law different ways (they don't agree). But that's my lawyer's advice so I'll stick with it and in case there is an issue, I at least have that to fall back on. Don't think for a second that at some point the ATF and maybe Congress aren't going to get around to taking a hard look at these trusts and god forbid we have some gun-hating prick as an attorney general (oh wait) who may look for loopholes and grey areas to use to stick it to people.
I owe my buddy a gun purchase too, but I sure as hell won't throw the money down on the counter while he's filling-out the paperwork in front of the salesman. In some places you can't lend another person a handgun to go to the range without you being present. The rules about storage, transport and possession of Title II weapons are pretty strict. I'd tend to err on the side of caution and avoid unnecessary entanglements when possible but other guys like to walk around with their balls out. To each his own.
If you haven't noticed, two different lawyers will interpret the same law different ways (they don't agree). But that's my lawyer's advice so I'll stick with it and in case there is an issue, I at least have that to fall back on. Don't think for a second that at some point the ATF and maybe Congress aren't going to get around to taking a hard look at these trusts and god forbid we have some gun-hating prick as an attorney general (oh wait) who may look for loopholes and grey areas to use to stick it to people.
I owe my buddy a gun purchase too, but I sure as hell won't throw the money down on the counter while he's filling-out the paperwork in front of the salesman. In some places you can't lend another person a handgun to go to the range without you being present. The rules about storage, transport and possession of Title II weapons are pretty strict. I'd tend to err on the side of caution and avoid unnecessary entanglements when possible but other guys like to walk around with their balls out. To each his own.
This sounds a lot like my attorney. He specializes in Class 3 and didn't say anything about needing a separate bank account for the trust. However, it doesn't sound like a bad idea at all, but it must not have been important enough for him to make that recommendation.
You don't need a 'court case number' to be considered informed about a law.
People exceed the speed limit tens (if not hundreds) of thousands of times every day without issue. Of course, speed limits are not determined by opinion letters. And the next time you bash the ATF remember how much you say you trust them.
Telling people to open a bank account has nothing to do with selling trusts. This is YOUR agenda that you are pushing, not that of trust lawyers.
Don't be naive; doing that is not a necessary task of a regulatory agency.
Not quite... That's not an illegal transfer, but it could be a straw purchase. The difference is whether the transfer of the firearm is legal.
maybe this was asked or answered already, but those of you who claim you need a separate bank account to purchase NFA items in the name of your trust, so you can "establish chain of title" or some dumb shit like that..... please answer this: Whats the ATF going to do with your NFA trust bank account when all of the deposits into that account are coming from your personal bank account? I mean, if you're trying to cover your tracks then your going to be depositing all cash into the NFA account? So then what if they start looking into the personal accounts of those listed as the settlor and trustees and find money withdrawn for cash that matches whats put into the NFA account? and so on, and so forth... just keeps spiraling on and on.
Pay with a personal check. your name is listed on the trust as the Settlor and Trustee, its no secret where the funding is coming from, and no one really cares.
Pay with a personal check. your name is listed on the trust as the Settlor and Trustee, its no secret where the funding is coming from, and no one really cares.
Because 'no one really cares' is not a good business practice.
Graham's Rule #1 applies. You misunderstand how business works: The ATF doesn't DO anything with your bank account; and you are assuming incorrectly that one is trying to 'cover' one's 'tracks'.
Do you NEED a separate bank account? Nope. But it's a smart thing to do if you intend to enter a world where right and wrong can be determined retroactively and in the absence of legislation.
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And you think a bank account opened by YOU and funded by YOU is going to do anything to protect you in this “world" you describe? Of they are so far in your business that they are looking at your bank accounts, they can link one that you opened and funded, to you! The NFA trust account still has you at the helm.
If it makes you sleep better, then by all means.
If it makes you sleep better, then by all means.
Again: The purpose of the exercise is not to disguise who funded the trust, or the name of the trustee. The issue is not who funded the trust.
To put it another way: What would be the point of taking your advice to: a) do the transaction in a way that could subject it up to allegations of a sham; and b) comingling funds?
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Wait a minute who's on first???
If ATF really wants to retroactively arrest tens of thousands of NFA owners, then we're all fucked, plain and simple. They can find a million and one reasons to do so, without even having to make shit up beforehand. "You failed to properly capitalize the middle initial of your name in the certification of compliance...registration revoked, go straight to jail!"
The reason they don't is plain and simple: the political and physical force required to do so isn't within their powers. The fallout in DC wouldn't end careers, it would end the existence of entire agencies. And that's not even contemplating the question of how many people would turn violent in the process.
Laws and lawyers aside, this will never be an issue.
The reason they don't is plain and simple: the political and physical force required to do so isn't within their powers. The fallout in DC wouldn't end careers, it would end the existence of entire agencies. And that's not even contemplating the question of how many people would turn violent in the process.
Laws and lawyers aside, this will never be an issue.
You are making this up. No one is talking about the arrest of tens of thousands and NFA violations do not occur from a failure to use capital letters. What people have been concerned about on this Thread is the exact opposite of what you are saying: One person; one significant mistake; and unnecessary scrutiny for that person only.
All the good folks that contributed the thought that a separate Trust account are correct, the Trust should have its own bank account for a whole host of important reasons, some having to do with estate planning as well.
Yes, for those of you that just sat down a wrote a personal check to buy items for a Trust, you were either poorly advised or not advised at all.
Should purchases of assets held within a trust be if at all possible paid for with funds originating from the trust? Yes.
Yes, for those of you that just sat down a wrote a personal check to buy items for a Trust, you were either poorly advised or not advised at all.
Should purchases of assets held within a trust be if at all possible paid for with funds originating from the trust? Yes.
Let me be clear: I don't expect ATF to arrest NFA owners because of paperwork typos.
On the other hand, there is absolutely zero legislative protection against exactly such a situation. ATF can approve or disapprove forms any which way they'd like, and they can also retroactively decide that a given item was improperly or incorrectly approved. I've had Form 4's returned to me for bizarre omissions or typos that were present on the original manufacturer's Form 3, for instance. A previously approved document, when resubmitted as another form, winds up getting kicked back because they changed their mind on how something should be formatted.
Hold no illusion that ATF doesn't have it within their authority to do whatever they want with the NFA. They don't for the sheer simple reason that it's not in their interest to rock the boat. Hence why they approve Form 4's with blank Schedule A's, and with completely filled out and detailed Schedule A's. And why they'll approve Form 4's with random bullshit for transferor's business title, like "Ferengi Grand Nagus" (as per FirearmsConcierge). It just doesn't matter to them..right now. I don't think that's ever going to change, but it theoretically could. If ATF cared about the source of payment, then they would require it to be documented properly at the time of submission. Because they don't, and I've yet to see a single recorded instance of someone getting a form rejected or facing arrest because of improper payment methodology, I have absolutely zero reason to believe that ATF feels this is a mandatory issue.
Law is a set of ideal rules set forth by the politicians. Policy is what determines whether you actually wind up in handcuffs or not.
Bureaucracies are composed of people, directed and authorized by law, who create and use their policies upon the public. To ignore the role of the human in the equation is to fear that which is improbable, and to ignore that which will harm you.
You are missing the point here. a Revocable trust insulates you much like an S Corp. It also deletes the requirement for a local sheriff to sign your app, deletes the fingerprint requirement, and allows you to name a beneficiary at the time of your passing. No one is trying to hide anything, just using good prudent legal sense.
So, what do trust stamps approved and paid with personal check do now to be out of the Grey ?
How do you unwind a ball of string?
You will want to document that you contributed the money to the trust by paying the seller. Then the trust must accept the benefit. This should be done and attached to the trust before the trust is sent to the ATF for approval of the Form 4 on the item.
Are you a lawyer?
It doesn't matter; I'm not giving legal advice.
I wouldn't bother getting an NFA Trust checking account. First the NFA tax is not a transaction tax, it's a transfer tax. The reason I mention it's not a transaction tax is to point out that it does not matter what entity funds it. Second, NFA laws deal with possession not ownership. It's possible to own an NFA item but not possess it (happens all the time until it's transferred). So, one purchases a suppressor and owns it and then gifts that ownership to the trust. I wouldn't take the time to gift cash to the trust just so the trust can purchase items until such time that the transfer tax becomes a transaction tax or ownership language is added to the NFA.
Personally, I would think that putting money into an NFA bank account without gifting the money first would look more like a straw purchase than just buying the item and then gifting the item to the trust. And how many actually take the time to gift cash to a trust before the trust purchases an item. How's your paper trail look now?
Personally, I would think that putting money into an NFA bank account without gifting the money first would look more like a straw purchase than just buying the item and then gifting the item to the trust. And how many actually take the time to gift cash to a trust before the trust purchases an item. How's your paper trail look now?
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A straw purchase is one in which an agent agrees to acquire a good for someone for whom it is not legal to purchase it himself, and then the agent transfers the good to the prohibited person after the purchase.
Straw purchases (for firearms) are illegal regardless of the possessor's legal status to own. One can not purchase a firearm for another using the recipients funds PERIOD. Perfectly legal to gift, though, assuming the funds were not acquired by the giftee (and assuming the giftee can legally possess a firearm).
I would not consider an undeclared cash gift to a Trust to be a straw purchase unless, of course, there are multiple beneficiaries in the trust. Can of worms.
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Is that what is says on your 4473? I have a feeling the purchaser was an individual on that form since one can't do a background check on a trust or corporation. And you will fill out a 4473 for a suppressor. I'm willing to bet the Trust did not fill out that form and was not the purchaser of the suppressor.
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That's actually not legal because the dealer has to assume the purchaser is the possessor. Your FFL would absolutely deny that occurred if he wanted to keep his license.
Here's the form. Your scenario does not exist for legal purchase. Question 11a. Page 4.
http://149.101.29.141/forms/download/atf-f-4473-1.pdf
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Everyone is doing it incorrectly. The transferor is required to pay the tax per the NFA:
Part II -- Tax on Transferring Firearms
Sec.
5811. Transfer tax.
5812. Transfers.
§ 5811. Transfer tax
(a) Rate. -- There shall be levied, collected, and paid on firearms transferred a tax at the rate of $200 for each firearm transferred, except, the transfer tax on any firearm classified as any other weapon under section 5845(e) shall be at the rate of $5 for each such firearm transferred.
(b) By whom paid. -- The tax imposed by subsection (a) of this section shall be paid by the transferor.
Part II -- Tax on Transferring Firearms
Sec.
5811. Transfer tax.
5812. Transfers.
§ 5811. Transfer tax
(a) Rate. -- There shall be levied, collected, and paid on firearms transferred a tax at the rate of $200 for each firearm transferred, except, the transfer tax on any firearm classified as any other weapon under section 5845(e) shall be at the rate of $5 for each such firearm transferred.
(b) By whom paid. -- The tax imposed by subsection (a) of this section shall be paid by the transferor.
Even if he filled the 4473 and turned around and gave his buddy the handgun that's still legal per federal and many state laws.
Paid and funded are different concepts for transaction purposes. I seriously doubt you'll ever get a transferor to fund that transaction. If you find one, let me know.
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