Disclaimer: I am not a JD, but this is the direction I received from mine. This is how I got an SBR direct from Noveske.
[ol]
[li]Find a Class III dealer in your area. You can expect at least a $100 transfer fee
[/li][li]Have the Class III dealer fax their info to your manufacturer/dealer of choice
[/li][li]Place the order for your SBR with your manufacturer/dealer. They will fill out the paperwork to transfer the weapon to your Class III. This will take a minimum of three weeks.
[/li][li]Find a local lawyer, go to guntrustlawyer.com or take a risk with Quicken to make your own trust
[/li][li]Sign, witness and notorize your trust.
[/li][li]Sign, witness and notorize your certification of trust. (Do not mail this to the ATF)
[/li][li]Fill out a certificate of compliance (ATF Form 5330.20).
[/li][li]Either open a bank account in the trust’s name and pay for your SBR from that account, or purchase your SBR with your money and write a statement which indicates that you contributed X number of dollars to [the name of your trust].
[/li][li]List additional trustees on a separate document, called the “First Amendment of the [your name] trust”. Have your additional trustees sign, witness and get notorized.
[/li][li]When your weapon arrives at your Class III dealer, go there and have them fill out the bottom portion of the form 4 in duplicate. Make sure they do it properly (see example below).
[/li][li]Fill out your portion of the form 4 (see example below)
[/li][li]Fill out an assignments page to “assign” the ownership of your SBR to the trust
[/li][li]Mail the ATF your $200 check, the form 4 filled out in duplicate (must be an original double sided copy), a COPY of your trust, a COPY of your certificate of compliance, a COPY of your first amendment to your trust (if you have one), a copy of the assignments page, and a copy of the document stating where the money came from for the purchase of the SBR
[/li][li]Wait.
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Yea I just to talk to my lawyer last night about opening a trust he’s charging $750 out the door . But I don’t understand the part why I can’t pay in cash for anything I buy. Why I need a bank accont in the name of my trust…? Do you know why I havent talk to my lawyer yet today…?
Sec.*112.006.**ADDITIONS TO TRUST PROPERTY. Property may be added to an existing trust from any source in any manner unless the addition is prohibited by the terms of the trust or the property is unacceptable to the trustee.
As long as it is properly registered to the trust, it doesn’t matter how it was paid for. The NFA act only controls transfers and says a tax must be paid, but does not care who pays the tax or for the item.
Same goes for Nevada. The trust I draft allows anyone to add property to the trust while the Trustor is alive. No account is needed unless the trust is specifically holding onto cash.
The ATF doesn’t care where the $200 tax payment comes from, so long as the check/mo clears.
So you don’t think there are any concerns about a straw purchase? Couldn’t it be argued that you are paying for it and the trust is receiving it? That is how it has been explained to me, and yes I understand it’s the overly cautious way to do it.
Sure you could be overly cautious and use a dedicated account, but in the end you don’t have to prove it was purchased by the trust. If you as the grantor owned an existing nfa item, you would just submit the form 4 and $200 and once received you add it to the trust’s assets.
Nothing else is needed to make it official. There is no need for the trust to pay for the item.
The way it was explained to me is that even with the separate account, YOU are the one that is supplying the money to the account, so the “money trail” will lead back to you regardless, so what’s the difference?
In regards to a factory SBR purchase, is there any worry that you could get a lemon upper that you will be stuck with due to the fact that the serial # is registered as an SBR? Wouldn’t it be better to SBR a known good lower to avoid this…even though you have to get it engraved?
I know that the likelihood of this is low, especially with top tier manufacturers like Noveske, but in the rare event that it does happen, what is the course of action that either you or the manufacturer will have to take?
I guess I put a lot of faith in Noveske…2k rounds last week without a hiccup:smile: I would also venture to say that any top tier manufacturer would take care of you. Also, your SBR lower is not married to any particular upper.
The issue isn’t the upper that my “rare situation” is concerned with. Its a SBR lower that is no good that you have too much invested in to just toss out or replace on a whim. I agree that the good people at places like Noveske would take care of you, but I was wondering (not so much a worry) what the procedure would be like in that case? New transfer/tax stamp/different lower with serial number, ect.?
Ok well I didn’t think my ? was going to stir this up that much but thx’s I understand now they the ATF wanna know were the money is coming from to buy the item’s makes sence but I guess I could also photo copy my pay check stubs and my withdraw ststement and have that on file , but the acct. is safer. And the $750 was the cheapest out of 6 different lawyers I contacted. And I might spend $750 But I’ll have my big boys toys… Plus I live in Bridgeport CT and my police chief refuses to sign any fourms for NFA items so I need to get a trust. And In the last year in CT ATF had come to 10 houses in CT that had those damn internet trust’s and tacking back there items. They the atf will sign off on the papper work and then down the road they see it’s not a real lwayer and a internet type deal and then send some people to take back the NFA items and now your out all that money so i’ll spend the $750 and cover my ass good…
I have heard many rumors of the ATF coming for NFA items in bad trusts, but never any proof. Got anything to back that up or a source for the info?
Being legal per state law on trusts is different than being legal under the GCA and NFA laws on transfer of firearms. I know there are a lot of people who don’t know what they don’t know about trusts. I don’t know if it’s a big or small CYA but multiple people using a lawyer and getting the same advice recommending a bank account is a clue, to me anyway.
I’m overly cautious by nature, but I think that’s an attenuated reading of the law.
My understanding of a typical straw purchase situation is where Cletus walks into a gun store with Jethro, Cletus picks out a gun, and Jethro buys it, fills out the paperwork and gives it to Cletus after leaving the store.
When dealing with a trust, the situation is more like if Cletus and Jethro go to the gun store, Cletus picks out a gun and fills out the paperwork, but Jethro pays for it. Ownership passes with the transfer from the store to Cletus. In that case it shouldn’t matter where the money comes from. Jethro never owned the weapon.
What would concern me (only slightly more) is the definition of and NFA requirements for a “transfer,” which essentially means to dispose of in any manner. If I pay for SBR individually, assign my interest in it to the trust, and then, as the trustee, fill out the paperwork and pick it up, was there a “transfer” from me to the trust? I doubt it. Transfer in this context seems to presuppose having physical possession. But I have not researched this issue. It’s pretty esoteric, very technical, and I have a very hard time seeing anyone getting in trouble because of it.
Having said that, everything I just posted is theoretical and the law may be different. If anyone has information to the contrary, or knows of investigations or prosecutions that inquire into any situations like the ones in this thread I would appreciate knowing about them.