WHAT ARE NFA FIREARMS
NFA Firearms are firearms and other weapons which are more closely regulated by the government than ordinary firearms and codified in The National Firearms Act of the U.S. Code. Some weapons that are regulated by the NFA are considered, by definition, firearms even though they are not firearms in the traditional sense. Examples of this legal characterization would be suppressors, hand grenades and other destructive devices. People often refer to NFA firearms as Class III firearms or Title II firearms. The categories of firearms that are regulated by NFA include: Machine Guns, Short Barreled Rifles, Short Barreled Shotguns, Suppressors/Silencers, Destructive Devices, and a broad categories of firearms called AOW’s (Any Other Weapon). While many people have an interest in NFA Firearms, you simply can’t go down to the local sporting goods store and buy these items because the transfer and possession of NFA firearms is regulated by the federal government. Additionally, most states have their own state laws regarding the transfer and possession of these firearms.
NFA FIREARMS ARE LEGAL TO OWN
I often run into people who believe that NFA firearms are illegal for everyone, and they are usually surprised when they find out that’s not the case. As evidenced by the growing number of applications submitted to the Bureau of Alcohol, Tobacco, Firearms and Explosives, the legal ownership of silencers, short barreled rifles and shotguns and even select fire machine guns is becoming more popular.
While the ownership of NFA, or Class III firearms, by private individuals is generally legal in Texas, there are several caveats that private individuals must be aware of before purchasing NFA firearms. Before a transfer can take place, the firearm must be registered in the National Firearms Transfer and Registration Record. Unregistered NFA firearms are illegal for any individual possess. Registered NFA Firearms must also be legal under state and local laws. In Texas, it is a defense to prosecution, if you possess: 1. an explosive device, 2. machine gun, 3. short barreled firearm, 4. a firearm silencer, 5. armor piercing ammunition, if possession was following registration pursuant to the National Firearms Act, as amended.
PEOPLE WHO CANNOT OWN FIREARMS
There are also categories of people who are prohibited from possessing not only NFA firearms, but firearms in general. If you have ever filled out an ATF Form 4473(Federal Firearms Transaction Record), you know that you are prohibited from possessing a firearm if you:
- Are under indictment for a felony
- A convicted felon
- A fugitive from justice
- Unlawfully using or addicted to a controlled substance
- Have been adjudicated as mentally defective or incompetent
- If you received a dishonorable discharge from the military
- If you are the subject of a domestic relations restraining order
- Have ever been convicted of domestic violence
- Have renounced your US Citizenship
- Are an illegal alien
- Are a non-resident alien.
To comply with Federal and Texas Law regarding ownership of NFA Firearms such as silencers, short barreled rifles, short barreled shotguns and machine guns. You have to follow the rules outlined in the National Firearms Act relating to the transfer, possession and tax on these items. You need permission from the BATFE, and you have to pay a tax on the transfer or making of a NFA firearm. Part of the application process involves Law Enforcement Certification that requires you to have your chief law enforcement official sign off on your possession or making of an NFA firearm. In addition, the laws related to transfer and possession are strictly applied. Lending your NFA firearms to, or allowing a family member, or friend, possess your NFA firearms could not only result in seizure of your NFA firearm, but also criminal penalties including prison and fines.
WHY A TRUST IS THE BEST WAY TO HOLD YOUR NFA FIREARMS
To prevent the problems associated with individual ownership of firearms subject to the National Firearms Act, people are increasingly using other entities (such as a trust) to purchase their NFA items. Trusts, corporations, and various recognized business entities may own NFA firearms. While corporations and other business entities work, the NFA Gun Trust offers privacy and lower fees, which is a distinct advantage for most people.
A trust is a better vehicle for NFA gun ownership, as opposed to individual ownership, because it allows for flexibility and protection that individual ownership simply cannot provide.
The primary function of a trust is to manage property outside a person’s estate. The same holds true for an Texas Gun Trust. When a trust holds the property, it allows the owner to set the rules of who can use the property, and when; even when the owner is no longer able to make those decisions for himself. Trusts can also pass property to an heir, like a will. However, trust property does not need to be probated like a will does in Texas. Probate means the court supervises and approves all property transfers of a decedent’s estate and those probate records are part of the court records and available to the public. Moreover, if an NFA gun owner dies or becomes disabled and can’t manage their own firearms, the owner’s families often don’t know how to deal with NFA firearm. Many times family members don’t even realize that NFA firearms are regulated items and they could get in trouble for the illegal transfer or possession of NFA items. A Texas Gun Trust gives your family guidance in the management of your firearms and helps them from unknowingly becoming criminals.
A Texas Gun Trust is especially helpful when you want to have more than one user of an NFA firearm. The National Firearms Act and Gun Control Act have especially harsh penalties for illegal transfer or possession of NFA firearms. When you purchase a NFA firearm as an individual, there are no provisions for joint ownership or joint use. You cannot lend your NFA items to anyone or store them so that others have access to them. The word transfer has a very broad definition in the code:
”transfer” and the various derivatives of such word, shall include selling, assigning, pledging, leasing, loaning, giving away, or otherwise disposing of.”
If you make an illegal transfer not only are your NFA firearms subject to seizure, you expose yourself to criminal penalties and fines and the realistic potential of never possessing any firearm ever again. A Texas Gun Trust can be set up for multiple users and even multiple owners of NFA firearms, something individual ownership cannot achieve.
Law Enforcement Certification can often be timely, difficult or simply impossible for individuals who want to purchase or make NFA firearms. However, when a person with a Texas Gun Trust purchases or makes an NFA firearm, no law enforcement certification is required. The same is true for the fingerprinting and photographs which are required of individual purchasers. Even in areas where your chief law enforcement officer will sign off, it can slow the process down by weeks or months.
Like the assault weapons ban in 1994, the future possession of NFA firearms is uncertain as our gun laws become more voluminous and restricting. An NFA trust helps to establish and protect your right to ownership prior to any future ban and likely protect any future beneficiaries you have named in your trust.
While you can use a corporation or LLC to purchase NFA firearms, a NFA gun trust offers advantages cost and privacy advantages. In Texas, Corporations and LLC’s need to be formed and filed with the Secretary of State. There are also hundreds of dollars in fees associated with their formation. Moreover, the filings are public record and you have to file paperwork and pay fees to make changes. You are also subject to annual franchise tax filings even if you have no revenues. Moreover, in Texas you could be hit with a business property tax assessment on your NFA firearms. For most people a Texas Gun Trust is a better option than a business entity.
As a potential NFA owner, you need to decide whether you are going to make a NFA Firearm or purchase one from a dealer. Most people buy from a dealer and they will use an ATF Form 4 for their application. Those who go the route of making their own NFA firearm, usually in the context of a “short barrel rifle”, will make their application on a Form 1. You should note that you cannot make a machine gun unless you are a manufacturer or you are building it for the Government.
Regardless if you make or buy the NFA firearm, it will take several weeks to complete the application process and have your item in hand. You can’t make, or take possession of your NFA firearms until you have been approved and issued a tax stamp.
BUYING A NFA FIREARM
When buying a NFA firearm your Class III dealer will generally help you prepare your Form 4. The ATF Form 4 is the “Application for Tax Paid Transfer and Registration of Firearm”. On the application, you will provide your personal information and information about the firearms. If you are an individual, you will also have to provide a photo and fingerprint cards for a background check. If you are a trust, or corporation or other business entity, then no fingerprints or photos are required.
Both Form 4, for NFA purchases and Form 1(Application to Make and Register a Firearm) require “Law Enforcement Certification”, in this section of the application, the chief law enforcement officer of your local area must certify that local law enforcement, has no information that you will not use the firearm or device for other than a lawful purpose, and that possession of the items would not put you in violation of state or local laws. This is where many people have problems because some law enforcement officials will not sign an ATF form 4 as a matter of policy, and they are under no obligation to do so. However, a trust and other business entities are not required to have a Law Enforcement Certification and this is the only way one can even legally submit an application.
Along with your Form 4 or Form 1 application you must also complete another form called Certification of Compliance with 18 USC §922(g)(5)(B). On this form, you certify that your immigration status does not make you a person who is prohibited from lawfully possessing firearms.
After you submit your application along with the payment of the Tax ($200 for Machine Guns, Silencers, Short Barreled Rifles and Shotguns), ($5.00 of Any Other Weapon “AOW” designations). Your application and application fees are sent off, in duplicate, to the PO Box Address in Georgia. Your paperwork is then sent to the examination branch in West Virginia, where they will hopefully approve your application and issue your tax stamp. After you have been approved, your Form 4 is then returned to your FFL Transfer Dealer and you can go pick up your weapon.
When you are ready to buy or make an NFA firearm, consider a Texas Gun Trust. Feel free to give me a call and I will personally help you with your Texas Gun Trust, specifically tailored to your particular needs.
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