FAQs Colorado Gun Trusts | Colorado Firearm Trusts, NFA Trusts and Gun Trusts

FAQ

This column is not legal advice nor does it create an attorney-client relationship with the reader. Due to limited space, complex legal concepts and rules may be stated in terms of general concepts. Based on 2024 Colorado and Federal law. Consult legal counsel before acting on any information contained in this column.

Rocky Mountain Gun Trust Frequently Asked Questions

In reviewing frequently asked questions and this website, please keep in mind that we are talking specifically about our Colorado gun trust and not another trust from another place. Further, answers to your specific questions will be specific to your specific facts and cannot be answered just be reading FAQs. All information on this website should be considered general background information. Access to this website does not create an attorney-client relationship. Consult legal counsel before acting on any website information.

Does a limited purpose trustee have to undergo a background check when the full trustee purchases a suppressor?

In our trust, a limited purpose trustee is considered a Responsible Person under ATF rules. A limited purpose trustee must submit to ATF the fingerprint cards, photos, and Responsible Person form just like the primary/full trustee. Benefit is the limited purpose trustee name appears on the tax stamp and the limited purpose trustee is entitled to possess the suppressor.

Does your firm have a process in place for an NFA item to be correctly added to my trust when it was created by me the individual? Example: I purchased a suppressor and have the tax stamp under my name. I would like it to be added to my firearm trust.

When the tax stamp is in your name, ATF requires another Form 4 (and $200) to transfer the suppressor from you to your trust. Your memorandum outlines the procedure for filing the Form 4. Please note that your co-trustee added by first amendment will need to fill out the responsible person form and submit fingerprint cards and photos just like you do.

Who can I put on the trust (wife, son, daughter)?

We get this question a lot. First, by “put on the trust” what I assume you mean is added to the trust in a way that they can be in current possession of firearms in the trust. With our trust, that means adding them as a current trustee. Yes, you can add your wife, son or daughter as a current trustee.

What do they have to do? Do they need to be fingerprinted?

Whoever you add as a current trustee would have to fill out the responsible person form and send fingerprint cards and photos to the ATF for all Form 4/Form 1 submissions after the date they are added. Currently, there does not appear to be a retroactive requirement. Another option is to utilize our short term trustee form.

What are the advantages of having an NFA trust for my existing firearms?

Ability to quickly react to Red Flag Orders. Consolidating ownership in an entity that does not die. Ease of transfer of possession to the next generation – ownership stays with the trust. The ability to quickly flee a jurisdiction and transfer physical location of the firearms should the local laws become unfriendly.

Will the trust allow me to purchase a fully automatic rifle?

Yes, assuming you are otherwise eligible.

Are there ongoing maintenance requirements for the trust?

No. However, you should keep proper records of all items transferred to the trust or purchased in the name of the trust. We go over this in our memorandum.

How long does it take to get the trust to be active?

The trust is active upon execution. Usually start to finish less than 2 weeks. We are usually waiting on you and not vice versa.

How do I transfer ownership of existing firearms to the trust?

It depends on the type of firearm. For example, Title I firearms can be transferred by the provided assignment form. Depending on the situation, an additional ATF Form 4473 background check may be required; and the conservative approach is to submit a Form 4473 following instruction 1 on the back of the form (Transfers to business entities). We provide the referenced affidavit as part of your documents.

I have a living estate planning trust, is that a substitute for an NFA trust?

In my opinion, no, it is not. Most standard living trusts do not fully address firearm ownership issues.

What if I move to another state with your Colorado gun trust. I understand that the Colorado gun trust will not make it legal to possess if a state prohibits the firearm. What if I move to a state that does allow the firearm? How difficult would it be to amend the gun trust?

Moving to another state should not be a problem. Maine is the only state I can think of that requires an amendment to the trust to make local law apply. On occasion, a firearms dealer may hesitate even though they should not. In that situation, a minor amendment to make that the law of the new state apply should probably be adequate.

Can a gun trust be used for other purposes? Meaning other personal possessions?

Our Rocky Mountain Gun Trust is specifically designed to hold firearms and firearm accessories. We do not recommend using the gun trust for anything else. A properly drafted gun trust is not your usual estate planning trust.

Can I meet with you before deciding on the Rocky Mountain Gun Trust?

Yes. Remember that brief phone calls are at no charge. That said, I can meet with you. I do bill for my time when we meet prior to executing the Rocky Mountain Gun Trust.

When I buy my title II firearm from a class 3 dealer, do I bring my original gun trust?

This is addressed in the memo that comes with your gun trust. A copy should be okay.

I have an S-Corp. Can I use my S-Corp to hold my title II firearms?

In our opinion, it would be unwise.

Can I create a Rocky Mountain Gun Trust with my wife/significant other? A joint settlor trust?

Terminology. The “settlor” is the person creating the trust. Settlor, Grantor, Trust Maker typically all mean the same thing — the individual creating the trust. We try to deter people from joint settlor gun trusts. If joint settlors part ways, it becomes very difficult (translated – $$$$$) to amend the trust. Plus, the beneficiaries are not always the same for both settlors. Properly drafted, the cost is about the same as doing two, separate trusts; and each of you can be co-trustee on the other’s separate trust.

Can I create a Rocky Mountain Gun Trust and let a co-trustee buy firearms for the trust?

Yes. BUT, whoever is the trust maker/settlor is in TOTAL control. If a co-trustee buys a firearm in the name of the trust, the trust maker / settlor can exclude the co-trustee.

What is the Colorado Large Capacity Magazine Ban?

Colorado law section 18-12-301 through 303. Starting on July 1, 2013, selling, transferring or possessing a Large Capacity Magazine is a class 2 misdemeanor in Colorado.

What is a Large Capacity Magazine?

In general, it means any device designed to accept more that 15 rounds of ammunition or that can be readily converted to accept more than 15 rounds of ammunition.

Does the Ban Only Apply To Magazines?

No. A magazine is one specific type of ammunition feeding device.

What is a High Capacity Magazine?

A misuse of the term. The official term is Large Capacity Magazine. We respectfully suggest that you not use that term because of the image it creates in the minds of others. In that same vein, we have found that the term firearm or gun is preferable to weapon for similar reasons.

Can I Keep My Large Capacity Magazines I Acquired Prior to July 1, 2013?

Well, that is a bit of a loaded question. The short answer is yes, but there is risk, in our opinion. In addition, upon your death, the Large Capacity Magazine cannot be given to another person. We assume (since there are no regulations as of April 1, 2016), that forfeiture is required and that your estate will have an opportunity to forfeit the Large Capacity Magazine before being in violation of the law.

For a little longer explanation, we do not believe the statute creates an exception. The statute starts by prohibiting possession of Large Capacity Magazines, period. In Section 18-12-302(2)(a), a person may possess a Large Capacity Magazine if he or she owned it prior to the effective date of the law and maintains continuous possession.

First, just what exactly it means to “continuously possess” the Large Capacity Magazine is open to debate. Second, please note that this is something that a person is entitled to raise AFTER they have been charged — a person has the right to assert that they possessed the Large Capacity Magazine prior to the effective date and then the prosecution (not the police officer) has the burden to prove otherwise. We believe that means anyone in possession of a Large Capacity Magazine can be charged, cuffed, hauled off to jail; and their Large Capacity Magazine seized even if they show the arresting officer proof of possession prior to the effective date of the statute and proof of continuous possession after the effective date. Again, without state regulations fleshing out the statute, this is is a difficult question to answer.

Are Links a Colorado Large Capacity Magazine?

Good Question. We assume they are. Links is a term that has different meaning to different people. For example, a client brought us two different types of WWII vintage links – one American and one German. The American link is what we call a disintegrating link. As it feeds through the firearm and the ammunition is expended, the links come out the other side in individual pieces that can be re-assembled with new ammunition. The German version does not disintegrate and looks more like a continuous belt.

We will have to wait for the regulations to be written to know how Colorado views these links. For now, we assume that both examples above are subject to the ban starting July 1, 2013 because they are a feed strip or a device capable of accepting or designed to be readily converted to accept more than 15 rounds of ammunition.

I can get a trust form online for under $200. How is your Colorado gun trust different from these cheap form trusts?

Because it is a Colorado gun trust drafted by a Colorado lawyer and not some generic form. Unfortunately, the proliferation of cheap online gun trust forms has created the perception that all trusts are created equal. Not so. Most people using these online forms do not understand the difference between the trust settlor, primary trustee, co-trustees, successor trustees and beneficiaries. Most people using these online forms don’t understand who in their gun trust is entitled to possess firearms, when they are entitled to possess firearms and under what circumstances. We know this because we interview our clients asking very specific questions about client goals. Most clients start by saying they want to add so-and-so to the Colorado gun trust. Just what exactly does that mean? “Add” somebody to the trust?

The truth is, people using cheap forms have no idea. We spend significant time determining client goals and then making recommendations. Initial drafts go out including the Colorado gun trust and other documents. There is typically a phone conference with an attorney to discuss those drafts. Finally, we encourage our clients to execute the trust in our office where we ensure the documents are executed correctly. When executed remotely, we ask for executed copies to be emailed to us for review. That review usually results in corrections to about 40% of the gun trusts executed remotely — that’s right 40% need revision when executed out of our presence. We are currently considering charging an additional fee for Colorado gun trusts executed out of the office because they typically take considerably more lawyer time than trusts executed in the office. Now, just imagine the error rate when the trust maker uses a generic form, not tailored to Colorado and without professional assistance. The choice is yours. Do you value the services of a professional? Or no?

Is there any disadvantage to having my name as the name of the NFA trust?

In my opinion, no. Some like the NFA trust to be more discreet and not mention your name. The counter argument is that by having your name in the NFA trust, a not-so-smart police officer can easily make the connection between you, the tax stamp, and the NFA trust.

My last NFA trust said ” Revocable “ in the name. This one doesn’t. Is that important?

In our NFA trust, no, it is not important. We have removed the word revocable to shorten the trust name.

Does not having the word “Revocable” affect opening a bank account in the name of the NFA trust in any way?

In our trust, no.

I have a quick question about my gun trust that was established by your firm a few years back. Is this trust a revocable or irrevocable trust by chance? I have some other non-firearm assets I may want to include in it (much like a domestic asset protection trust) but wasn’t sure if this trust was the right “type”.

Your NFA trust is revocable. Our professional gun/NFA trust is irrevocable and is a $2,300.00 to $3,400.00 investment depending on the complexity. Your current trust can be amended/updated to the professional version to make it irrevocable.
We typically do not recommend putting non-firearm related items in either our revocable NFA trust or the irrevocable NFA trust. The use of a trust to hold firearms for the use of the Settlor (i.e., you) and others (i.e., your co-trustees) is a very unique use of a trust. Your NFA trust is drafted specifically for that unique use.
We offer domestic asset protection trusts for assets other than firearms. Typically, the investment in the domestic asset protection trust is $2,400.00 to $3,800.00 depending on the complexity (plus hourly for help in funding the trust). The investment in a domestic asset protection trust can be substantially more if there are income tax, estate tax, and gift tax issues involved.
We have found that many people misunderstand the effectiveness of an asset protection trust when you are trying to put your assets in trust for your use. In Colorado, domestic asset protection trusts don’t always protect the assets when you directly continue to obtain the benefit of those assets. However, a domestic asset protection trust does provide some deterrent to creditors even when not totally effective.

I setup an NFA trust with you back in 2013. And I have a question concerning the changes the ATF made concerning “Responsible Persons” and the new requirements of finger prints, photos, and a questionnaire for each person that fits this definition. I am the only trustee on my trust but I have a successor trustee (my father) and two beneficiaries (my brothers). My question is, would my father be subject the new rules about fingerprints, photo, questionnaire since he is the successor trustee or am I the only one that would need to fill out the new required items to purchase an NFA item going forward? I assume my brothers would not as they are only beneficiaries of the trust.

In our typical NFA Trust document, successor trustees and beneficiaries upon death are not responsible persons. Those individuals should not need to fill out fingerprint cards, photos, and ATF responsible person forms. What that also means is those individuals should not be in actual or constructive possession of NFA items unless they are added as a current, co-trustee.

I would like to add my Title I firearms to my NFA trust. Please advise on the best way to proceed. All my title I purchases have been made under my name with background checks to me. My understanding is that I need to complete a declaration of contribution form to have a paper trail, but that may be difficult to do.

Regarding transferring your Title I firearms to your trust, you do not use the Declaration of Contribution form. You use the assignment form. The assignment form should be in your binder and labeled. It has 14/15 lines on the page. We recommend making copies and using 1 assignment form for each firearm because, if for some reason you must disclose the assignment, you are only disclosing one transfer.

The question comes up about background checks for transferring Title I firearms (Colorado) to your trust. The conservative approach is to get a 4473 background check for each Colorado, Title I firearm you already own and transfer to your trust. Regarding any co-trustees, again the conservative approach is to have them also get the 4473 background check if they will be in possession of the Title I firearms more than 72 hours (3 days) without you present. This is the exception to the Colorado background check law; not to be confused with federal laws regarding NFA items. Currently under Colorado law (2020), you can loan your firearm to another for up to 72 hours without triggering the background check requirement (the “3 day exception”). Please follow the instructions on the back of ATF Form 4473 for business entities. Short version is sign the 4473 “Your Name”, Trustee and swear out the referenced affidavit that you are making the request on behalf of the trust. We now have that affidavit as part of our standard documents.

Regarding the Declaration of Contribution, this form is often misunderstood. The Declaration of Contribution is used when an NFA item or firearm is purchased on behalf of the trust not using a trust financial account. It is not used when transferring a previously purchased firearm or NFA item to your trust. For example, you purchase a suppressor using your personal credit card and then go set up our trust before filling out the Form 4. In this situation, you would fill out the Declaration of Contribution documenting an indirect gift of the purchase proceeds to the trust. “I, Douglas Turner, as trustee of my trust, contributed xx dollars to the Turner Trust through the use of credit card number 1234, made payable to The Local Brick and Mortar Suppressor Shop, for the purchase of The Acme Suppressor Supreme, Model XYZ, serial number 56789.” An example using a Title I purchase on behalf of your trust: You purchase a 22 long rifle using your personal credit card. You are careful to fill out the ATF Form 4473 following the instructions for a purchase by a business organization (See form 4473 instructions). You should fill out the Declaration of Contribution form and keep it with your trust documents.

Stated another way, you will never need to use the Declaration of Contribution form if all new trust purchases are done through the trust financial/checking account. It is only for when you use personal funds instead of trust funds.

If I move to different state, what is required for my trust?

The question is a bit broad. Your NFA trust we drafted should be valid in most states. That is a different issue from whether the state you move to allows possession of the items in the trust. It is also different from what that state may require of you (registration, licensing, etc.). Those questions must be asked of a qualified lawyer in the state you move to.

Stated another way. Your trust does not circumvent local law. A gun trust does not allow you to do/not do something otherwise required by that state or the federal government.

What exactly will my Gun Trust do for me if Law Enforcement comes after my guns under Colorado’s Red Flag Law?

It gives you some negotiating ability. Our gun trust is designed to expel a trustee that becomes a prohibited person unless it is a Title II (NFA) firearm in the actual, physical possession of the trustee being expelled. When the Red Flag order is issued and then served upon you, our trust tries to distance you from any right to possess trust firearms. In theory, this gives you the ability to say that you are not entitled to be in possession of any trust firearms; and therefore, no trust firearms should be confiscated.

Practically speaking and in my opinion, I doubt law enforcement will distinguish between the right to possession and any firearm located at your residence. The Red Flag order may be written broadly. The police officer will probably tell you to take it up with the prosecuting office or the court. However, to the extent there are current, co-trustees and the firearms are not in the residence and in the possession of the co-trustees, in my opinion, it creates a good argument that those firearms are not subject to confiscation. Keep in mind that you cannot be in possession of a firearm once the Red Flag order is issued. Should the co-trustee allow you to be in possession of the firearms after the Red Flag order is issued, civil and criminal liability could exist.

I have moved. Do I have to update my trust address?

Well, that depends on what you mean. Our trust does not contain a physical address. This is intentional so that you do not have to amend your trust every time you move and take your NFA items with you. That is a different issue from what the ATF requires when there is a permanent change of address/location of an NFA item. When you submitted your Form 1 or Form 4, you listed a permanent location for the NFA item. If that permanent location will change, you must update the permanent location with the ATF using Form 20 (5320.20) BEFORE the permanent change in location.