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Question on Lawful Transfer of Pre-May '86 Machine Guns


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#1 iron bender

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Posted 09 January 2020 - 09:38 PM

I'll start this by saying, I will not ever be in the FFL business again. Period. Out of the question. To the point of the thread, I'm curious about the disposition of some machine guns. Today, I called Texas Law Shield to speak to the NFA lawyers, and they don't currently know the answer. Hoping maybe someone here has an actual law abiding real answer, with proof. I currently have a trust with lots of NFA stuff in it. My dad HAD an FFL.  He got rid of it 10 years ago. (For those who know him he's still alive and well, FYI). He still owns 8 machine guns. Four of the eight are going into my trust fine. Four are PRE-86 dealer samples, which are perfectly legal for the original holder of the FFL to keep. NOT POST 86 SAMPLES (they're goners with the license no ifs ands or buts). Can pre-May samples be moved to a trust (not an individual) from a former FFL, or are we :)ed? For those of you curious, I may be fixing to have a sale on a really nice MG34, two BAR's (Winchester 1918 and Royal Typewriter 1918a1), and one M1a1 tommy gun. Curiosity is biting at me and I've read the rules a hundred times. Interested if anyone has experienced this or knows actual FACTS, not I thinks. Some of you dudes are smart. Please show me the written law. I'm all ears and not concerned either way. I probably missed the facts in the written rules pumped out by BATF. Thanks in advance!

 



#2 colt thompson

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Posted 10 January 2020 - 05:48 AM

My understanding is that pre-86 machine guns can be kept by the original registrar but can only be transferred to another SOT holder. I've never dealt with it but it's my recollection



#3 TexRdnec

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Posted 10 January 2020 - 06:22 AM

ya, if that were a thing and you could keep pre-86s in perpetuity i'm sure it'd have already been done



#4 Phantomf4

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Posted 10 January 2020 - 08:05 AM

 9.5.3 Distribution of estate firearms. A decedent’s registered NFA firearms may be conveyed taxexempt to lawful heirs. These distributions are not treated as voluntary “transfers” under the NFA. Rather, they are considered to be involuntary “transfers by operation of law.” Under this concept, ATF will honor State court decisions relative to the ownership and right to possess NFA firearms. So, when State courts authorize the distribution of estate firearms to decedents’ lawful heirs, ATF will approve the distribution and registration to the heirs if the transactions are otherwise lawful. A lawful heir is anyone named in the decedent’s will or, in the absence of a will, anyone entitled to inherit under the laws of the State in which the decedent last resided.

couldn't they be willed to him?



#5 Phantomf4

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Posted 10 January 2020 - 08:06 AM

9.5.3.1 Distributions to heirs. Although these distributions are not treated as “transfers” for purposes of the NFA, Form 5 must be filed by an executor or administrator to register a firearm to a lawful heir and the form must be approved by ATF prior to distribution to the heir. The form should be filed as soon as possible. However, ATF will allow a reasonable time to arrange for the transfer. This generally should be done before probate is closed. When a firearm is being transferred to an individual heir, his or her fingerprints on FBI Forms FD-258 must accompany the transfer application. The application will be denied if the heir’s receipt or possession of the firearm would violate Federal, State, or local law. The law enforcement certification on the form need not be completed. The form should also be accompanied by documentation showing the executor’s or administrator’s authority to distribute the firearm as well as the heir’s entitlement to the firearm. Distributions to heirs should not be made until Forms 5 are approved. Executors and administrators are not required to have estate firearms registered to them prior to distribution to lawful heirs.



#6 Phantomf4

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Posted 10 January 2020 - 08:08 AM

As the law states above he might just be able tio will them to you. Now it doesent state pre may dealer samples. I'd call the ATF and ask them. 



#7 Phantomf4

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Posted 10 January 2020 - 08:26 AM

14.2.1 Sole proprietors. FFLs licensed as sole proprietors, who have been qualified to deal in NFA firearms and who go out of the NFA business, may lawfully retain their inventory of these firearms, including imported NFA “sales samples”, in their individual capacity. No NFA transfer occurs that would require an ATF-approved transfer because the firearms are still possessed by the same person to whom they were previously transferred and registered. However, any firearm registered to the individual as a “sales sample” would continue to bear the “sales sample” restriction on any subsequent transfer, unless the firearm is being transferred to a government agency. Thus, the transfer of a “sales 215 ATF P 5300.4 (09/05), Question C-7, Page 180 216 18 U.S.C. 923(g)(4); 27 CFR 478.127 217 Ibid. 218 Ibid. 85 sample” to other than a government agency will only be approved if the transferee is an FFL/SOT qualified to receive such samples.219 Since the registered owner of the firearm is no longer an FFL/SOT, the owner’s subsequent transfer of the firearm to other than a government agency would be subject to transfer tax and require approval of an ATF Form 4. NOTE: If an NFA firearm registered to a sole proprietor as a “sale sample” becomes part of the person’s estate upon his/her death, the firearm may not be registered to a beneficiary of the estate unless the beneficiary is qualified to deal in NFA sales



#8 Phantomf4

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Posted 10 January 2020 - 08:27 AM

Well the will thing won't work, read the last sentence of section 14.2.1



#9 iron bender

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Posted 10 January 2020 - 08:29 AM

Phantomf4 thank you. The four transferable guns are going into my trust asap. It's those pesky pre-may guns that are getting at me. Really I'm only disappointed because of the BAR's. My current thought is to peddle the four samples and use the money to buy a transferable BAR

 

That last one is what I'm looking for. Did the ffl thing for a long time and that's not happening again. 


Edited by iron bender, 10 January 2020 - 08:33 AM.


#10 Phantomf4

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Posted 10 January 2020 - 08:36 AM

Yeah, it can be a pain. I personally don't see the big deal, they are still machine guns no matter what the paper work says. You should be able to keep them but ohhhh no the form says dealer sample. LOL



#11 johnsonlmg41

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Posted 10 January 2020 - 06:54 PM

Had you set up a another entity such as a corporation,llc, etc........ anything but a trust, it could have held an FFL/SOT and transferred the pre-may samples to it, then dropped it later.   As the regs are currently, trusts are barely a legal entity, have issues crossing state lines, and a number of other pitfalls including their longevity, etc.     The short answer is no, you can't move pre-mays into a trust, they can only go to a current SOT.   They can't even be willed/ form 5'ed to a beneficiary.    Now you know why they are cheap....er.



#12 Okie96

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Posted 11 January 2020 - 11:26 PM

For anyone interested this may help some. Wish I had money for a BAR and Thompson. Or a few.



#13 johnsonlmg41

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Posted 12 January 2020 - 11:50 AM

Unfortunately at 7:20 the claim is made pre-86 dealer samples can be transferred to an heir without an SOT.  That's not correct and is what the OP is asking about.  There's a reason they use red ink on these dealer sample stamps, so you don't attempt to transfer them to anyone other than an SOT  i.e. "red flag".   Other than the the video is pretty good basic info, but I can tell you from personal experience Morphy's, nor any other auction houses are up to speed on what it takes to transfer to entities, they wait till after the correction letter arrives to fix it.   This adds time and frustration to an already long process.  Other than a 2 month period, I've had transfers in the system for over 20 years as a person, LLC, and SOT for a time.    What's also funny is I recently acquired the barrel Ian mentions late  in the video and it's in queue for repair here.....small world.



#14 Leatherneck72

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Posted 14 January 2020 - 03:58 PM

Sending you a PM. I work under a Class 3 FFL for NFA MG's. 




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