Firearms raise estate planning issues

William Kain

More than a third of American households have firearms. Consequently, passing on guns to family members and other heirs can constitute an important part of the estate planning process.

As a simple example, take a 60-year-old man who wants to leave his hunting rifles and a few handguns to his beloved grandchild. It might not be enough to simply add to his will the statement: “I leave my hunting rifles and handguns to my grandson, Jake.”

Hunting rifles and most handguns don’t need to be registered at the death of an owner under Colorado law, and can simply be delivered to the beneficiary named in the will if the beneficiary resides in Colorado.

However, the National Firearms Act (NFA) applies special rules and restrictions when an “NFA firearm” owner dies. The definition of “NFA firearm” includes sawed-off shotguns, machine guns, sawed-off rifles, certain handguns, guns with silencers, umbrella guns, knife guns, grenades and other types of extremely dangerous and unusual weapons.

One of the first tasks of an executor carrying out an estate plan is determine whether the firearms should be sold or distributed to a particular heir. It’s best to let a dealer handle any sales. If an executor is going to transfer an NFA firearm to a particular beneficiary, the executor needs to comply with federal requirements.

Consideration also should be given to whether either the executor or beneficiary receiving receiving the firearm is disqualified by law to possess a firearm. Generally, the following persons are disqualified to possess a firearm: anyone who has been convicted of any crime punishable by imprisonment for a term exceeding one year, a fugitive from justice; an unlawful user of controlled substances; someone who’s been adjudicated mentally defective or has been committed to a mental institution; an alien who’s unlawfully in the United States; anyone dishonorably discharged from the armed forces; anyone who has renounced his citizenship; anyone subject to a restraining order from harassing, stalking or threatening an intimate partner; anyone convicted of a misdemeanor crime of domestic violence; and anyone adjudicated as a juvenile for an act that would have been a felony if committed by an adult.

In addition to federal law, several state gun laws also affect estate planning and execution. State law requires background checks for most private transfers of firearms. The law doesn’t apply to a transfer of a firearm at death by an executor or trustee under a will. It isn’t clear whether the State Legislature intended to leave out a trustee of a living trust as an exempt transferor at death.

A newly enacted state law prohibiting large-capacity magazines applies to firearms transferred at death. How an executor should dispose of an illegal magazine is not made clear by the statute.

Still other state laws also could apply.  The following are illegal in Colorado: firearm silencers, machine guns, short shotguns, short rifles, ballistic knives, blackjacks, gas guns, metallic knuckles, gravity knives and switchblade knives. It is also illegal to possess a defaced firearm. Moreover, it’s illegal under state law for a juvenile under the age of 18 years to possess a handgun.

There are substantial penalties for violating federal and state firearms laws. If an executor were to transfer a firearm to a person ineligible to possess a firearm, the executor has committed a felony.

The above offers only a brief summary of federal and state laws and isn’t intended as specific legal advice. Nor does this cover every applicable law. Anyone planning or settling an estate, especially where firearms are involved, should consult with a qualified estate planning attorney.