Methods to Acquire Class III/NFA Firearms:
There are two different avenues for acquiring Class III/NFA firearms and devices: as an individual or as an entity.
(1) Individual Possession and Ownership of Class III/NFA Firearms
A Nevada resident may lawfully possess/own Class III/NFA firearms so long as they comply with the procedures established by the BATFE. This includes submitting a completed BATFE Form 1 or Form 4, payment of the $200 tax stamp, payment of any local FFL transfer fees, purchase of the item, background check, fingerprints on FBI FD-258, photos, and finally the signature of the Chief Law Enforcement Officer (“CLEO”) where the applicant resides on the Form 4. Some of the major drawbacks are that many CLEOs either create long delays in signing or outright refuse to sign the form at all. Overall, this is typically the longest route to go and wait times can easily reach into many months.
(2) Entity Possession/Ownership of the Class III/Firearms
An alternative to the individual route is to create an entity and then have the entity possess/own the Class III/NFA firearm. This method eliminates several of the above steps, including the fingerprinting, photographs, and CLEO signature. By creating an entity, time can be saved and other benefits can also be realized.
A Nevada resident can form a corporation or limited liability company to possess/own Class III/NFA firearms. Then, either the directors/officers or the members can legally possess and use the firearms. As explained above, this can often reduce wait times down to a month. Additionally, a corporation or LLC allows multiple individuals to legally possess the Class III/NFA firearms (unlike the individual method above), often without additional paperwork. The disadvantages of using a corporate entity or LLC is that the startup costs and requirements can be significant, there are annual fees to the secretary of state, and there is no privacy. Additionally, if the corporation or LLC dissolves, the Class III/NFA firearms must then be transferred to someone else, thus incurring another $200 tax stamp fee.
(b) The NFA Gun Trust
More specifically, a Revocable Living Trust, which is the preferred trust vehicle for creating an entity to possess/own Class III/NFA firearms. With an NFA gun trust, there is only the single fee to pay to create the trust and no annual costs. Moreover, like the corporation/LLC, multiple individuals (trustees) can legally possess the Class III/NFA firearms. A properly created trust, with the nuances of the NFA in mind, can also ensure that the Class III/NFA firearms are distributed when the trustor passes away. Be forewarned that a “cookie-cutter” trust does not consider the implications of the NFA upon distribution and violations of federal and state law can occur. Considering the significant cost of purchasing Class III/NFA firearms and devices, it is worth it to have an experienced attorney prepare your NFA gun trust.
Contact us to learn more about how we can prepare your NFA firearms trust (for as low as $299) or form a corporation/LLC for a NFA gun purchase.
You can find out more here: Nevada Gun Trust Attorney