Gun trusts can also be drafted with incentive provisions for carrying on the firearm legacy. Gun trusts are purpose-built to hold guns. The benefits of a gun trust are so numerous that just about every gun owner in California should have one.
Gun trusts have grown in popularity as a means to acquire Title II firearms under the National Firearms Act (NFA). Title II firearms (also called NFA firearms or Class 3 firearms) include machine guns, silencers, short-barreled rifles, short-barreled shotguns, and a class of firearms called “Any Other Weapon” or AOW. The NFA excludes most handguns so the AOW class includes unusual firearms not fitting in the other classifications. While legal in most states, most of these firearms are not legal in California except for certain types of AOW. In California, gun trusts have been a popular means of acquiring these AOW—which for the most part can be thought of as short-barreled shotguns without a stock.
However, the benefits of a gun trust extend much further than NFA firearms. For all gun owners, gun trusts can help prevent accidental felonies by instructing those involved with trust administration about the transfer rules and other rules which can turn family members into felons. Both the successor trustee and the recipient may be held criminally liable if the rules are not followed. Problems may arise in handling firearms; or in transferring them out of state, for example if the firearm is banned in the recipient’s state, perhaps due to a modification made to the firearm; or in transferring to a prohibited person. There are many classes of prohibited person under both state and federal law: felony conviction; misdemeanor conviction for domestic violence; certain violent misdemeanors; fugitive status; renunciation of citizenship; adjudicated mental defects; illicit drug use (including medical marijuana, even if legal in the state); dishonorable discharge; illegal alien or aliens here under non-immigrant visa; anyone with a restraining order against them; etc. Any trust will avoid probate, but the trustee designated for a gun trust can be a person who knows the rules better than the surviving spouse, so the survivor does not end up in the slammer.
The gun trust can help carry on the firearm legacy in a number of ways, and this may be very important to the family. First, it is surprising how often a trustee or attorney that knows nothing about guns may just recommend that the guns be turned in to the police. Guns can be quite valuable, and this is not only wasteful but probably a violation of fiduciary duty! The gun trust can either distribute the firearms outright, or sell them for cash, or exchange them for an annuity to benefit the survivor, or the guns may be kept in trust for generations and used to train the beneficiaries. The gun trust can be funded with a small life insurance policy in order to maintain the firearms and provide this training. In this way, the firearms may be protected from confiscation by the government—more on that in the section below on irrevocable trusts. By allowing use by multiple beneficiaries at once, the beneficiaries can be evaluated on maturity, responsibility, and skill, before any firearm is transferred to them. The gun trust can also help insulate the rest of the estate from possible civil liability arising from misuse of the firearms.
The gun trust may also serve as a way to avoid having to sell the firearms in a hurry in the event of a restraining order, if the court approves transferring the firearms to a successor trustee. Restraining orders are common in divorce situations.
The gun trust may also help someone convicted of a felony/misdemeanor wobbler get their firearms back in the future, once their Second Amendment rights are restored.
But the most important benefit of a gun trust is that it can turn a family into a firearms training institute, for generations. Incentives can be given for descendants to train with different weapon platforms; to meet certain performance standards; to enter competitions and win; to get certified as a firearm instructor; to get licensed to carry concealed; to actually make it a practice of carrying daily, subject to verification by the trustee; to learn how to reload ammunition and actually build guns at home; etc.
Incentive trusts are often viewed as potential litigation traps, but because the gun trust has limited assets it is not likely to cause a family feud. The firearms often do have high sentimental value, which will increase its effectiveness in transmitting values and training, but any conflicts will be limited to the gun trust.
