Hi guys, every so often I see some incorrect discussion about NFA trusts that I'd like to clear up. Note that this is about private registered NFA firearm ownership, rather than FFL holders. Also note that this is not legal advice to anyone here - I'm just sharing my ornery, cussed opinion on this topic.

First off, the vast majority of folks who form an NFA trust nowadays are doing so in order to own a suppressor or short barreled firearm (and a few "any other weapon" type firearms). These are relatively inexpensive items that can be easily replaced should the need ever arise. In contrast, the original purpose of NFA trusts was to ensure continuity of ownership for transferable machine guns, which have a very limited supply, are very costly, and are pretty much irreplaceable if one is destroyed/stolen/lost. As a result, there's two basic types of trusts - the cheap 'kiosk' trusts for suppressors & SBRs, and more costly lawyer-drafted customized trusts to protect high value collectible machine guns. One can also use an NFA corporate entity (LLC, limited partnership, corporation) instead of a trust, but they carry higher risks and are not suitable for the vast majority of suppressor & SBR owners. I do sometimes recommend them in limited cases for folks who want to own transferable machine guns.

The main purposes of an NFA trust or entity are to allow multiple people to share and use the NFA firearms without creating "transfers", and to allow continuity of ownership after your death.

When a trust purchases an NFA firearm (suppressor, SBR, machinegun, etc), as part of the application to ATF, EVERY "Responsible Person" must submit form 5320.23 ('responsible person' questionnaire) with fingerprints and photographs. In the case of an NFA trust, every trustee is usually a 'Responsible Person', and in the case of a corporate entity, the officers/managers are usually 'Responsible Persons'. The ONLY time that the 5320.23 must be filled out is when the trust is submitting an application to make or transfer an NFA firearm. I'm going to repeat that - the ONLY TIME that the form (with fingerprints and photos) must be filled out is when the trust is submitting an application to make or transfer an NFA firearm. So, most trusts are formed with the grantor/settlor (the person creating the trust and putting property in) as the sole trustee, and a separate beneficiary named. Once the tax stamps are issued, then the grantor adds the other people that are desired as trustees who can use the firearms.

Here's where I see the incorrect discussion: I've seen folks post that every time you add a new trustee to an NFA trust, that person has to send in fingerprints & photos to ATF.

FALSE There is no statute or regulation that imposes such a requirement. Once the trust has the tax stamp, then the grantor may add or remove trustees at his discretion (provided of course that the trustees are not "prohibited persons" under applicable law), and there is no requirement to notify ATF of the change in trustees. When the grantor dies and the successor trustees take over, there is no 'transfer' of any firearms - the trust is still the registered owner. The same applies to corporate entities, so an LLC could have a change of managers, or even a change of company ownership, and there is no 'transfer' that requires any reports to ATF.

Now here's a caveat that I want to share regarding those cheap kiosk trusts. I bought one a few years back, and have compared it along with a couple client supplied ones to the trusts that I draft. I've seen the instructions tell the grantor to remove all other trustees when applying for a new NFA firearm, and then to add the trustees back after the tax stamp is approved. While there's no express prohibition against such a practice, the ATF could view it as attempting to evade reporting requirements, assuming that they learned of the additional removed trustees while reviewing an application. Consequences could include ATF rejecting the application, or deciding that an unlawful transfer took place . . . or worse.

TLDR version - a change of trustees in an NFA trust does not require new fingerprints and photos being sent to ATF unless the trust is acquiring another NFA firearm.

Thanks Zeek!

Good info…exactly as I understand it too.

I’m almost of the opinion to just form a new trust every item. Seems in the long run it could sure make some things easier. One example - what keeps me from adding someone to a trust then “giving” them the trust?

For common items like suppressors and SBR's, this isn't necessarily a bad approach. But for machine guns, more sophisticated planning is necessary.

Hypothetically, if you had a single-suppressor (or SBR) trust, you could appoint your friend or family member as a the beneficiary of the trust, and also name him as the sole trustee.

Ok so my SIL has a trust for a suppressor. Does that mean he can add me without fingerprints and such?

Assuming he’s already got the tax stamp, yes.

If he buys any other NFA items on that trust after he adds you then your stuff would be needed for those additional items though.

I'm assuming that the trust already owns the suppressor? If so, then yes, he can add additional trustees without fingerprints etc.

But as Judd said, if he adds you as a trustee, THEN purchases additional NFA firearms, you would have to submit form 5320.23 w/fingerprints etc.

Good stuff.

Question...
I have a trust with a single suppressor on it from 2015, which is pre-fingerprinting. I added a few people from my family to the trust (pre tax stamp). If I were to pick up another or a couple more suppressors now on that same trust, everyone has to submit that form and fingerprints, correct?

With what Judd said about just creating a new trust for essentially each transaction from here on out, I would assume that would probably be one of the easier routes to go rather than getting everyone on my current trust to get forms and fingerprinted?

Yes, if you add anything to the existing trust everyone on the trust has to be fingerprinted and photographed.

All good things come to an end.

Adding, deleting, manipulating a trust so paperwork, prints, photos don't have to be submitted will end this process. "Someone" will screw up and it will be traced back to a trust member issue and ATF will stop approving trust paperwork.

People always assume they are smarter than a 1st grader (AFT) and push the envelope to the point of failure. With the explosion of suppressors and SBR's on trust paperwork, there will be an event where someone that shouldn't have been on the trust or wasn't added back when "Uncle Joe" bought the new item, there will be a review of the trust process.

KRoyal answered your first question, but as to the second one ... it depends. If you only have a few NFA items, then a 'single shot' trust for each could be workable, so long as you remember to prepare your trustee appointment (or removal) for every trust when you want to add or remove someone. But if you end up with a larger NFA collection, there's a greater chance of forgetting to prepare documents for every trust for each change. The risks involved with forgetting one of these could be pretty severe (an illegal transfer or illegal possession of an NFA firearm, which can get up to ten years prison time).

Depends on how well-organized you are and how well you can maintain your documents.



Agreed. That's why I dislike the kiosk trusts.

Thanks. That's kind of what I was thinking.

Makes sense. My thinking, at least at this stage in my life, I'll probably only pick up a 2-3 more suppressors over the years and that's it.

So I have 2 suppressors and 2 single shot kiosk trusts. I could see myself buying maybe 1 or 2 more suppressors (over time),
Hypothetically, my brother would like to use my suppressor(s), so I assume I would need to add him somehow to the trust. Is it better I form a more legal/separate trust?

The company who sold the trusts to you should have provided a template or form to add a trustee to each trust.