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1/22/2020 12:12:56 PM
Posted: 1/18/2015 11:10:11 PM EST
I work under a 1099 for three different companies. Business may be picking up for me, and my accountant has asked if I have looked into getting an LLC (he mentioned two types, but I cant remember what they are called). I told him I havent. I mentioned that I was thinking about a Trust so I can eventually buy a suppressor and perhaps SBR a M92. He said he isnt sure, but I may be able to get stuff under the LLC. He said he would do it for $300, some .22LR ammo, and help guide him on getting an AR journey.

However I was talking to a cat at the range today that had a suppressed 9mm AR (also SBR'ed) and he said getting them under the LLC isnt the way he recommends. He recommends a trust. Something about if I take a family member shooting, and hand the gun (say an SBR) to them to shoot, I could get in trouble. He also said if the LLC goes away, (why would it go away?), I could be in trouble. Maybe I am not relaying exactly what or how he said.

A little background. I again live in Dallas County. It is a liberal dominated county, as is the city. My family works for the sheriffs office, but she is a die hard liberal, among other things, that wont even discuss it with you. The chief of Dallas PD is also a raging liberal (again, amongst other things). Anyways, getting a signature in Dallas County is next to impossible, so I'm told and understand. Moving is not a possibility at this time.

What are your thoughts?
Link Posted: 1/19/2015 5:38:42 AM EST
My opinion - I would go with a Trust and get it from a lawyer that specializes in NFA Trusts. I wouldn't trust an accountant (no offense to accountants everywhere) to draw up a Trust that would withstand the scrutiny of the courts if it ever came to that.
You can always cut corners, have an accountant draw it up, you could get a copy from a friend or create it yourself. For me, spending a few hundred bucks to make sure it's done right is the only option when not doing it right has the possibility of landing you multiple felony convictions which takes away your right to have any firearm - not just NFA items.

Again, my opinion.

Link Posted: 1/19/2015 8:00:55 AM EST
Link Posted: 1/19/2015 9:42:10 AM EST
In many states, there are recurring taxes on LLCs. In every state, there is some sort of filing fee to create the LLC in the first place. Neither of these apply to trusts. I recall hearing, though, that you can form a non-profit LLC in TX for a filing fee of only $5, with no recurring fees.

A trust is primarily an estate planning device, and has some side benefits for NFA ownership. If you don't have any particular plans to pass your NFA stuff to someone on your death, a trust may introduce some complications that you don't want to deal with.

IIRC, bigcbass here is a TX attorney who does NFA trust/LLC work. I'd suggest getting in touch with him to discuss the details of your situation, and determine which would be better for you.
Link Posted: 1/19/2015 12:13:29 PM EST
I have contact Chris, but he is at SHOT and is short on time. His short answer is LLC. If I did a trust I was absolutely going to through Chris Bass, I wasnt going to try and do it myself.

In the State of Texas there is no renewal fee (yearly or otherwise) for LLCs, and I would only have to pay a franchise tax/fee if I made over 1..... meeellion dollars. Besides selling railroad stuff, I also do some stuff in the firearms world, so guns, ammo, etc is considered a write-off.

At this point, I am considering doing both. I just want to make sure I am not screwing up. Also I am trying like hell to avoid having to get a CLEO, since this is Dallas County.
Link Posted: 1/19/2015 12:50:25 PM EST
Well, I wrote a fairly long message and the board went down...

Anyway, I chose an LLC, for me it was a one-time fee of $150 and was super easy to file for. After I filed it, when you submit the forms for your stamps, it's literally one-paper, easy and simple. It was also explained to me (by a SOT) that with an LLC (in my state), I can verbally authorize family-members to have access to my NFA items, hence I don't have to worry about locking them up or people not having access to them.
Link Posted: 1/19/2015 2:47:56 PM EST
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By FAIL-SAFE:
At this point, I am considering doing both. I just want to make sure I am not screwing up. Also I am trying like hell to avoid having to get a CLEO, since this is Dallas County.
View Quote

I can't easily think of a situation in which having both a trust an an LLC for NFA ownership would be needed, but I suppose there could be. Neither needs CLEO signature as it stands now. If ATF 41P is implemented in anything like its proposed version, both (as well as corps) will require CLEO signatures, along with prints/photos/etc.

An LLC isn't going to be limited to a single person having possession of the NFA items. I don't know exactly what the process would be for it to be legal (with a trust it would be a co-trustee), but I'm sure Chris would square you away on that as well.
Link Posted: 1/19/2015 3:43:23 PM EST
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.
Link Posted: 1/19/2015 4:21:52 PM EST
[Last Edit: 1/19/2015 4:23:33 PM EST by texassooner]
Get a trust. No fees for cert of formation. Have an attorney draw it up for you and you never have to mess with it again. I was in Dallas County for many years and i tried everything to get a signature. You can pretty much forget about it.
Link Posted: 1/19/2015 4:36:37 PM EST
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By FAIL-SAFE:
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.
View Quote

I'd lean toward using a separate LLC for the NFA stuff, but as I'm not licensed in TX I wouldn't go much further than that. Especially if there aren't any ongoing fees or other requirements, I'd think keeping them separate would be a good idea.
Link Posted: 1/19/2015 5:23:29 PM EST
[Last Edit: 1/19/2015 5:47:11 PM EST by Homeinvader]
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By FAIL-SAFE:
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.
View Quote


You should look beyond simply acquiring an LLC for NFA and see the accounting and tax issues with your capitalizing the LLC to buy NFA firearms. You should understand clearly the relationship of the LLC to you as a member. Putting money in and taking it out present serious income tax issues which can bite you later on.

If you get an LLC to do your work, then buying NFA items through the LLC will present a non-deductible expense since it's not related to your business. You will likely owe federal and state income tax on that money. Not a smart idea. This is why a separate LLC should be used for NFA purposes.
Link Posted: 1/19/2015 5:26:54 PM EST
[Last Edit: 1/19/2015 5:29:45 PM EST by Homeinvader]
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By polizei1:
Well, I wrote a fairly long message and the board went down...

Anyway, I chose an LLC, for me it was a one-time fee of $150 and was super easy to file for. After I filed it, when you submit the forms for your stamps, it's literally one-paper, easy and simple. It was also explained to me (by a SOT) that with an LLC (in my state), I can verbally authorize family-members to have access to my NFA items, hence I don't have to worry about locking them up or people not having access to them.
View Quote


What your SOT said is highly dubious.

Designated persons for an LLC must be LLC members or employees, not just family members. That a verbal declaration would cover this is hilarious, something out of an episode of The Office...
Link Posted: 1/19/2015 8:58:06 PM EST
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By Homeinvader:


You should look beyond simply acquiring an LLC for NFA and see the accounting and tax issues with your capitalizing the LLC to buy NFA firearms. You should understand clearly the relationship of the LLC to you as a member. Putting money in and taking it out present serious income tax issues which can bite you later on.

If you get an LLC to do your work, then buying NFA items through the LLC will present a non-deductible expense since it's not related to your business. You will likely owe federal and state income tax on that money. Not a smart idea. This is why a separate LLC should be used for NFA purposes.
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Originally Posted By Homeinvader:
Originally Posted By FAIL-SAFE:
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.


You should look beyond simply acquiring an LLC for NFA and see the accounting and tax issues with your capitalizing the LLC to buy NFA firearms. You should understand clearly the relationship of the LLC to you as a member. Putting money in and taking it out present serious income tax issues which can bite you later on.

If you get an LLC to do your work, then buying NFA items through the LLC will present a non-deductible expense since it's not related to your business. You will likely owe federal and state income tax on that money. Not a smart idea. This is why a separate LLC should be used for NFA purposes.


There are no state income taxes in Texas. The only time the state would get involved is if I make more than $1M. I am damned far from that.

Also the other industry I am in besides railroad is firearms as a journalist.


Link Posted: 1/19/2015 9:01:38 PM EST
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By FAIL-SAFE:


There are no state income taxes in Texas. The only time the state would get involved is if I make more than $1M. I am damned far from that.

Also the other industry I am in besides railroad is firearms as a journalist.


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Originally Posted By FAIL-SAFE:
Originally Posted By Homeinvader:
Originally Posted By FAIL-SAFE:
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.


You should look beyond simply acquiring an LLC for NFA and see the accounting and tax issues with your capitalizing the LLC to buy NFA firearms. You should understand clearly the relationship of the LLC to you as a member. Putting money in and taking it out present serious income tax issues which can bite you later on.

If you get an LLC to do your work, then buying NFA items through the LLC will present a non-deductible expense since it's not related to your business. You will likely owe federal and state income tax on that money. Not a smart idea. This is why a separate LLC should be used for NFA purposes.


There are no state income taxes in Texas. The only time the state would get involved is if I make more than $1M. I am damned far from that.

Also the other industry I am in besides railroad is firearms as a journalist.




Ok, no state Income tax. Still have the fed to worry about.
Link Posted: 1/19/2015 11:21:16 PM EST
If I chose to get a suppressor, because I work in the firearms industry, how would that not be related to my business?
Link Posted: 1/20/2015 11:24:06 AM EST
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By FAIL-SAFE:
If I chose to get a suppressor, because I work in the firearms industry, how would that not be related to my business?
View Quote


It probably is. Just understand how the LLC and its accounting works before you go nuts with spending.
Link Posted: 1/20/2015 12:22:23 PM EST
I don make the kind of money to go nuts with spending!
Link Posted: 1/20/2015 12:48:06 PM EST
Discussion ForumsJump to Quoted PostQuote History
Originally Posted By FAIL-SAFE:
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.
View Quote

I'm in the "get both" camp, simply because you really want to separate your personal assets from business assets. If you're sued for some business reason, you don't want your NFA stuff at risk of being force liquidated to pay a judgement or settlement.
Link Posted: 1/20/2015 1:59:31 PM EST
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Originally Posted By Mariner82:

I'm in the "get both" camp, simply because you really want to separate your personal assets from business assets. If you're sued for some business reason, you don't want your NFA stuff at risk of being force liquidated to pay a judgement or settlement.
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Originally Posted By Mariner82:
Originally Posted By FAIL-SAFE:
I am leaning towards the LLC because of my 1099s. As I said, in Texas there is no renewal tax or fees, I just have to submit a yearly report. It would seem the LLC would cover me business wise and with NFA.

I'm in the "get both" camp, simply because you really want to separate your personal assets from business assets. If you're sued for some business reason, you don't want your NFA stuff at risk of being force liquidated to pay a judgement or settlement.


Of equal importance, you cannot pass LLC assets to heirs. You can pass on LLC membership shares, but this is very different and presents some huge tax and civil liabilities.

If estate planning is important, LLC is not the way to go to buy expensive things. But an LLC is hugely beneficial to the work.
Link Posted: 1/20/2015 5:13:15 PM EST
I really like the DIY Trust from Silencershop. If you don't have a complicated estate it should be fine. With my small collection I couldn't justify the $600 for an attorney to draw one up plus the $150 they wanted every time the Trust was amended.
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