Click Here To Know More About:
By Joe Willis
Texas law requires a trust to get funded in order to be created. Section 112.005 within the Texas Property Code (Texas Trust Code) provides: ‘A trust is not created unless there is trust property.’ Nominal funding is sufficient to create a trust where the other formal requirements for the establishment in the trust are met. In a battle over a large estate, the San Antonio Court of Appeals ruled that funding a trust with $1.00 was sufficient corpus to fulfill the funding requirements of a valid trust. In Re: Estate of Canales, 837, S.W.2d 662 (Tex. Civ. App. – San Antonio, 1992). The mere drafting and signing of one’s revocable trust won’t form a trust unless it is funded. That is why questions have been brought up by ATF examiners for ATF Form 4 transferees regarding NFA trust funding. In case your trust has not been funded the transfer may just be to a non-existent entity therefore invalid. A gun trust must be funded to be in existence and valid.
Funding of any Class 3 gun trust may be accomplished in several ways. A bank account is generally opened or property can also be transferred to the trust. Trust property is know for being the ‘res’ or ‘corpus’. It is crucial to document transfers of property into an NFA gun trust. Given that a gun trust can last several generations and survive the death its creator (grantor or settlor), issues often arise in regards to what property the trust actually owns. When there is not a soul living to ask, documents will be reviewed to ascertain ownership. The document which shows a transfer of title into the gun trust is the Form 4 or Bill of Sale. Without either there is no written proof for the conveyance of NFA or other tangible physical property in the trust. This can lead to expensive litigation later on if not done correctly in a timely manner. A few years ago, litigation arose from the large estate of a Kerrville oilman. When the trustee of the trust created by the oilman’s will did not keep very good records, it turned out difficult and quite expensive to discover what property was actually contained in the trust and what was not. Some of the items to be transferred to the trust or left to their heirs had stickers with the trust or beneficiaries names thereon. However, after a period the glue had dried up and also the stickers had fallen off of the items making it difficult to determine who was entitled to what property. For instance, the sticker around the back of a $25,000.00 painting by Salinas, hanging on the a wall in the estate’s mansion, had fallen off. The sticker on the back of a less expensive armoire with another heir’s name thereon had also fallen off. Both stickers were found lying on the floor, next to one another, behind the armoire covered in dust. The dispute over who received the expensive painting versus the cheaper armoire needed to be resolved. In a gun trust setting this matter can be avoided through filling out a bill of sale conveying the property at issue (i.e. 1862 Sharps rifle, Serial # 3354) to the NFA gun trust and keeping the bill of sale with the original gun trust document. This should be sufficient proof of transfer from the non-NFA item into the trust. The transfer of NFA items into a gun trust require a approved Form 4 to be valid.
It is essential that a gun trust be funded and transfers in to the trust be properly documented. Martin Seidler, a Texas gun trust lawyer, solves these issues by properly drafting each NFA trust which he prepares along with a custom Bill of Sale with instructions for use.
About the Author: Jim Willis is a
Gun Trust
/
NFA Trust
enthusiast who provides information on acquiring class 3 weapons.
Source:
isnare.com
Permanent Link:
isnare.com/?aid=521723&ca=Legal