NFA Gun Trust Lawyer Blog
As of January 1, 2013 it became legal persons with a C&R license to purchase, transfer, make, possess, and use an SBR in IL.
The Law is poorly written and only indicates that it restricts possession. While it has been clear that a trust could not purchase an SBR in IL, there has been a question about whether an SBR purchased legally in another state by a trust could then be in the possession of a Trustee, authorized by the trust to possess the firearms in the state of IL when that person had their own C&R license.
ATF has recently rejected such a request stating that a trust may not have an SBR in IL. This does not appear to be entirely correct, but until someone is willing to challenge the decision by the ATF it will not be possible to use an ATF 5320.20 to bring an SBR to IL. Here is a copy of a rejected form.
This appears to be another example of the ATF not understanding trusts and how they work. The restriction in IL is on possession and not ownership, the trust owns the firearm, the trustee possesses the items in the Gun Trust.
Options in IL?
The Gun Control Act defines a “person” is as “Any individual, corporation, company, association, firm, partnership, society, or joint stock company.” While this definition does not include a person, it does include a partnership, corporation, company, or firm. We have had clients create business entities that were owned by a trust or where a trust was one of the members, directors, officers, or shareholders. By creating a business entity that is owned by a Gun Trust, you should be able to have the business entity obtain a C&R license, then have the business entity apply for approval to purchase or make an SBR using a Form 4 or Form 1.
I am sure many people will ask, why would I incorporate a Gun Trust when I could just use the business entity itself. The answer to this deals with the many benefits that a Gun Trust provides in the management and succession planning (the beneficiary designations) that are not available with a business entity. While it would be possible to create business documents that incorporated some of the protections found in a Gun Trust, the cost to do so would be far more expensive than just using a Gun Trust.
In Summary, SBRs are legal to possess in IL as of January 1, 2013 if the person in possession has a C&R. It appears based on documents rejected by the ATF that a Trust or Gun Trust may not bring an SBR to IL when it was purchased legally in another state even when the trustee has a valid C&R license.