A few hours ago, President Obama announced proposals to change the way the ATF handles NFA trusts. While the news is still fresh, I wanted to take a moment to discuss NFA trusts and the impact the proposed changes would have on the process of obtaining NFA-regulated items . . .
The National Firearms Act identified a number of different configurations of firearms that are classified as “restricted.” That means that you can still own them, but you need to pay a tax and pass a more rigorous background check to do so. The list of items includes short barreled shotguns, short barreled rifles, silencers and machine guns.
In order to get your hands on these items, you need to send in either a “Form 4” to buy such an item or a “Form 1” to make one yourself. On the form you need to answer the same old questions as you get on the 4473 (the “over the counter” transfer form). But the requirements differ depending on how you want to transfer the gun.
For individuals, you need to submit a set of fingerprints along with two passport-sized photos so that the FBI can do a background check on you. In addition, your chief law enforcement officer (or “CLEO”) needs to sign the form indicating that you aren’t a bad guy. The issue here is that some CLEOs, like the former San Antonio sheriff, refused to sign off on any NFA paperwork. Any, no matter who you were. This was in effect a ban on NFA items for individuals in that area, no matter what the state law says.
The way around that blockade is the NFA trust. By registering your NFA item to a corporation or trust, there is no longer an actual individual to fingerprint or run a background check on. Therefore no fingerprints are required, no photos are required, and no CLEO sign-off. It’s a much simpler way of doing the paperwork.
We have been discussing the proposed rule changes for months now, with the NFATCA back in March telling TTAG (well, me) that the sky is not actually falling and that trusts are here to stay. And now, with the outline of the proposal out in the public, their reading of the tea leaves appears to be right on the money.
The proposed changes appear to require all individuals associated with a trust to submit fingerprints and photos with every new form to the ATF, which is what we have been expecting for months. Still unknown is the extent to which documentation is required. For example, I’d assume that as the trustee I would need to submit fingerprints. But I list my sister as the beneficiary should I kick the bucket. Does she need to be fingerprinted as well? Hopefully we’ll know more once the ATF releases the proposal for public review.
However, conspicuously absent from that proposal is any mention of the CLEO sign-off. Whether that means that trusts will still skirt the sign-off, or if the sign-off is going away for good for all transfers, is still to be seen. The ATF was discussing removing all CLEO sign-off requirements with the NFATCA earlier this year, so hopefully that will lead to some progress on that front. If the alternative happens — that CLEO sign-off is required on all NFA applications both trust and individual — that would be “game over” for NFA ownership. The powers that be would no longer need to legislate changes to the ATF’s rules, they could simply block any and all transfers at the local level.
Overall, while this change seems big from a political standpoint, the impact on gun owners should be minimal. Assuming that the CLEO sign-off stays off the plate for trusts, everything should be more or less business as usual. Some additional headaches will be involved for those who have enjoyed skipping the fingerprinting line at the local sheriff’s office, but in the grand scheme of things these changes will not have a major impact on the ability for the average citizen to purchase a silencer or chop down their barrel to a more manageable length.
[UPDATE] The ATF has just released their proposed rule changes, and would require every single person listed on a trust to individually submit a CLEO sign-off. This is far worse than anyone had expected, and has the potential to deny hundreds of thousands of people their right to own NFA firearms.
That being said, the entire NFA system is broken and bloated and needs some drastic reform if not complete dissolution. But if this is the worst that President Obama can muster against gun owners then I’m quietly optimistic that things might be about to turn the corner for gun rights on the national level.