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Posted: 10/18/2009 12:17:10 PM EDT
| Anybody use an LLC instead of a Trust? |
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here it costs a yearly fee to maintian an LLC, also it must file taxes. a trust has non of that. if the LLC goes under.... sell the guns or retransfer.... trusts don't go under. LLC have to have annual 'meetings' with documented notes (even if there are none...). Its a trap. Stick with a trust until they don't allow them and you HAVE TO GO TO AN LLC. |
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here it costs a yearly fee to maintian an LLC, also it must file taxes. a trust has non of that. if the LLC goes under.... sell the guns or retransfer.... trusts don't go under. LLC have to have annual 'meetings' with documented notes (even if there are none...). Its a trap. Stick with a trust until they don't allow them and you HAVE TO GO TO AN LLC. OK Trust...maybe i will get some emails from the ones i emailed about them.....BRD whew! |
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I use an LLC and in my state you DO NOT need to have anual meetings and you DO NOT need to file taxes if the only thing the LLC does is hold NFA items. You do have to keep your LLC current but that only costs me $12 per year (less then a meal at McDonnalds). My LLC will never go under as mentioned above as long as I pay my $12 per year. My wife is named as an officer of my LLC so she has access to my NFA items if she wants to go shooting with me and will have controll if something should happen to me. You really need to investigate LLC's in your state but the advice given above is completely WRONG at least in my state.
MadDog |
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I use an LLC and in my state you DO NOT need to have anual meetings and you DO NOT need to file taxes if the only thing the LLC does is hold NFA items. You do have to keep your LLC current but that only costs me $12 per year (less then a meal at McDonnalds). My LLC will never go under as mentioned above as long as I pay my $12 per year. My wife is named as an officer of my LLC so she has access to my NFA items if she wants to go shooting with me and will have controll if something should happen to me. You really need to investigate LLC's in your state but the advice given above is completely WRONG at least in my state. MadDog True....every state's LLC req's are different. You don't even need to get an LLC in your state, you could in turn get a Colorado LLC if you live in MA for instance. I personally like an LLC because I can list officers on the fly and not have to worry about other family members using my NFA weapons. |
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here it costs a yearly fee to maintian an LLC, also it must file taxes. a trust has non of that. if the LLC goes under.... sell the guns or retransfer.... trusts don't go under. LLCs in Texas do not have to pay an annual fee. It exists forever as long as it maintains a registered agent address, file tax returns, and keeps its records (which isn't much unless you have a really complex operating agreement or you enjoy a lot of manager meetings - I don't). Texas LLCs file fall-through taxes as federal personal income tax returns (Texas has no state income tax) unless you specified otherwise in the article of corporation that it's its own taxable entity. Another benefit not mentioned is that you can sell a LLC without the buyer having to pay additional transfer taxes - the LLC owns the assets, not the managers. Selling assets for profit would mean the profit over contribution amount is subject to taxes. I'm not familiar enough with revocable living trusts in Texas to tell you if appreciating assets in the trust would fall under the same condition. I do know certain Texas trusts are taxed under the franchise tax. As usual, IANAL, YMMV. I would get legal advice about trusts and LLCs in Texas and make an informed decision based on what you need. You should be able to get enough information for free before you commit real money to either route. |
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True....every state's LLC req's are different. You don't even need to get an LLC in your state, you could in turn get a Colorado LLC if you live in MA for instance. I personally like an LLC because I can list officers on the fly and not have to worry about other family members using my NFA weapons. Same is true with a trust. With a revokable trust you (as the grantor) can change who the trustees are (or add or remove them) at anytime at YOUR sole discretion. I listed all my freinds and family members as trustees so they can all legally possess the gun. |
I use a corporation. I set it up years before it became known that trusts were an acceptable-to-ATF legal entity, but I've been very, very happy with corporate ownership. It does all I need, and is bulletproof. Plus, I'm not going to spend a coupla grand to transfer everything to a new entity, even if I wanted to.
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I am in the same boat as you, Tony. I did my first NFA item on an LLC only because my CLEO would not sign off and didn't know about the Trust route at that time. It would cost me way too much to transfer all of my items to a newly formed entity. I just got my latest Form4 back today and it was only 6 weeks mailbox to mailbox. I ran the Form4 through my LLC as usual and my Class III dealer sent the forms out "snail mail".
MadDog 
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I am in the same boat as you, Tony. I did my first NFA item on an LLC only because my CLEO would not sign off and didn't know about the Trust route at that time. It would cost me way too much to transfer all of my items to a newly formed entity. I just got my latest Form4 back today and it was only 6 weeks mailbox to mailbox. I ran the Form4 through my LLC as usual and my Class III dealer sent the forms out "snail mail". MadDog Yup. My own experience also is that it's faster than either individuals or trusts. My last Form 4 took 8 or 9 weeks this summer, but only took that long because I had to void it and resubmit. 
My fastest corporate F4 was nine days from pending to approved; I don't recall a "normal" (non-paperwork-screwed-up) corporate F4 taking longer than 10 weeks.
Having also done my own personal individual F4's, and helped others do trust F4's .... I will stick with corporate. 
Your Mileage May Vary, of course. |
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I use an LLC. It has many advantages over trusts. You just really need to determine which is best for you depending on your personal circumstances. I would love to hear what those "many advantages" are b/c I can't think of any. Well, first, as far as corporations go ... you can sell the corporation (actually, the stock in the corporation) to a new owner. Try selling a trust. And the sale of a corporation by selling its stock is not a transfer –– the stockholders have changed, but the corporation remains the same legal entity. Thus there is no $200-per-item tax, or any paperwork to file with ATF. There also is no Form 5 needed for inheritances –– just will the stock to whomever you want, and they become the new stockholders and elect a new board of directors. No cost savings but a great paperwork one, that also reduces the chances of your heirs misunderstanding the paperwork requirements and turning assets into contraband. |
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I use an LLC. It has many advantages over trusts. You just really need to determine which is best for you depending on your personal circumstances. I would love to hear what those "many advantages" are b/c I can't think of any. Do a quick search and you will see my opinion, I have posted it here many times. Trust me the advantages are huge. |
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So i'm in Texas and if i set up an LLC what are the long term problems you might encounter if you don't want to kept the Title II firearms etc in it? Could you Transfer them to a Trust?
Any comments on this appreciated.I see LLC Form 1&4's going through fairly fast on here.
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Quoted: So i'm in Texas and if i set up an LLC what are the long term problems you might encounter if you don't want to kept the Title II firearms etc in it? Could you Transfer them to a Trust? Any comments on this appreciated.I see LLC Form 1&4's going through fairly fast on here. yes, for 200 bucks |
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So i'm in Texas and if i set up an LLC what are the long term problems you might encounter if you don't want to kept the Title II firearms etc in it? Could you Transfer them to a Trust? Any comments on this appreciated.I see LLC Form 1&4's going through fairly fast on here. yes, for 200 bucks Per each item in the LLC or one time? |
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Quoted: Quoted: Quoted: So i'm in Texas and if i set up an LLC what are the long term problems you might encounter if you don't want to kept the Title II firearms etc in it? Could you Transfer them to a Trust? Any comments on this appreciated.I see LLC Form 1&4's going through fairly fast on here. yes, for 200 bucks Per each item in the LLC or one time? each NFA item, it works just like a regular NFA transfer from one person to another, because the LLC owns the items not you* *edited to clarify
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So i'm in Texas and if i set up an LLC what are the long term problems you might encounter if you don't want to kept the Title II firearms etc in it? Could you Transfer them to a Trust? Any comments on this appreciated.I see LLC Form 1&4's going through fairly fast on here. yes, for 200 bucks Per each item in the LLC or one time? each NFA item, it works just like a regular NFA transfer from one person to another Daayummm! OK still going Trust here then. 
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I use an LLC. It has many advantages over trusts. You just really need to determine which is best for you depending on your personal circumstances. I would love to hear what those "many advantages" are b/c I can't think of any. Well, first, as far as corporations go ... you can sell the corporation (actually, the stock in the corporation) to a new owner. Try selling a trust. And the sale of a corporation by selling its stock is not a transfer –– the stockholders have changed, but the corporation remains the same legal entity. Thus there is no $200-per-item tax, or any paperwork to file with ATF. There also is no Form 5 needed for inheritances –– just will the stock to whomever you want, and they become the new stockholders and elect a new board of directors. No cost savings but a great paperwork one, that also reduces the chances of your heirs misunderstanding the paperwork requirements and turning assets into contraband. i have wondered about doing tax free "transfers" by transfering ownership of the LLC or by changing the various people listed in the trust. At first thought it seems like a way to transfer items tax free but I have not looked into it to check to see if it would work or not. I am guessing it would not because if it did then you would hear abotu it. I could be wrong though. example. you own a SBR in a trust. you want to sell it to someone. you ammend the trust to make them the trustee and whomever they want to be the binificiary. example. you own a SBR in a LLC. you want to sell it to someone. you sell the LLC to the guy who wants to buy the SBR. in both cases the NFA item is still owned by the same entity but the entity changes owners. just an idea that has passed though my head that I have not had the time to put much thought to. EDIT: i think i may just make a new thread abtou this |
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Quoted: Quoted: Quoted: Quoted: I use an LLC. It has many advantages over trusts. You just really need to determine which is best for you depending on your personal circumstances. I would love to hear what those "many advantages" are b/c I can't think of any. Well, first, as far as corporations go ... you can sell the corporation (actually, the stock in the corporation) to a new owner. Try selling a trust. And the sale of a corporation by selling its stock is not a transfer –– the stockholders have changed, but the corporation remains the same legal entity. Thus there is no $200-per-item tax, or any paperwork to file with ATF. There also is no Form 5 needed for inheritances –– just will the stock to whomever you want, and they become the new stockholders and elect a new board of directors. No cost savings but a great paperwork one, that also reduces the chances of your heirs misunderstanding the paperwork requirements and turning assets into contraband. i have wondered about doing tax free "transfers" by transfering ownership of the LLC or by changing the various people listed in the trust. At first thought it seems like a way to transfer items tax free but I have not looked into it to check to see if it would work or not. I am guessing it would not because if it did then you would hear abotu it. I could be wrong though. example. you own a SBR in a trust. you want to sell it to someone. you ammend the trust to make them the trustee and whomever they want to be the binificiary. example. you own a SBR in a LLC. you want to sell it to someone. you sell the LLC to the guy who wants to buy the SBR. in both cases the NFA item is still owned by the same entity but the entity changes owners. just an idea that has passed though my head that I have not had the time to put much thought to. EDIT: i think i may just make a new thread abtou this problem with your theory is your assuming there is only 1 asset in the trust/llc |
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i have wondered about doing tax free "transfers" by transfering ownership of the LLC or by changing the various people listed in the trust. At first thought it seems like a way to transfer items tax free but I have not looked into it to check to see if it would work or not. I am guessing it would not because if it did then you would hear abotu it. I could be wrong though. example. you own a SBR in a trust. you want to sell it to someone. you ammend the trust to make them the trustee and whomever they want to be the binificiary. example. you own a SBR in a LLC. you want to sell it to someone. you sell the LLC to the guy who wants to buy the SBR. in both cases the NFA item is still owned by the same entity but the entity changes owners. just an idea that has passed though my head that I have not had the time to put much thought to. I think it would work with a trust and it might be legit. One problem would be the risk that they might decide to prosocute you for tax evaision because they might say it was a sham transaction to avoid the tax. Also there might be a problem with the perpetual nature of a trust and what would happen after the settlor or grantee dies. |
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put each NFA item into its own trust and its not a problem. I do this with houses all the time. this idea may not be so practical with an LLC due to the cost involved in starting an LLC in some states. As stated before...if the cost and complication of creating an LLC in your home state is too troublesome.....create it in another state. Here in CO it's 5 minutes worth of paperwork and a $50 fee with a $10 a year fee after that. |
| The LLC route has caught my attention thanks to some of you. I too am in Texas and am not excited about the cost of a trust through a lawyer. I would rather spend that money on some tax stamps. I have read that it is not a good idea to create a trust using Will Maker or Legal Zoom. Is it safer to create a LLC on Legal Zoom than the trust? Or is a lawyer still the safest route? Any suggestions on how to get a legit LLC that will keep me from the arms of Bubba would be great. |
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The LLC route has caught my attention thanks to some of you. I too am in Texas and am not excited about the cost of a trust through a lawyer. I would rather spend that money on some tax stamps. I have read that it is not a good idea to create a trust using Will Maker or Legal Zoom. Is it safer to create a LLC on Legal Zoom than the trust? Or is a lawyer still the safest route? Any suggestions on how to get a legit LLC that will keep me from the arms of Bubba would be great. Most states have a website explaining what to do to create an LLC, generally this is the Department of States role. The best advantage to this, is the fact that the State will generally review the documents and approve the validity of your LLC before processing the paper work. I do not know specifically about TX, but I sure the information is out there. |
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The LLC route has caught my attention thanks to some of you. I too am in Texas and am not excited about the cost of a trust through a lawyer. I would rather spend that money on some tax stamps. I have read that it is not a good idea to create a trust using Will Maker or Legal Zoom. Is it safer to create a LLC on Legal Zoom than the trust? Or is a lawyer still the safest route? Any suggestions on how to get a legit LLC that will keep me from the arms of Bubba would be great. For researching Texas LLCs, I'd start here and here. This should give you an idea of whether or not you want to do it yourself, have a lawyer do it, or use one of the brokers (online or brick-and-mortar). http://www.sos.state.tx.us/corp/index.shtml http://www.statutes.legis.state.tx.us/Docs/CV/htm/CV.32.18.htm#1528n |
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The LLC route has caught my attention thanks to some of you. I too am in Texas and am not excited about the cost of a trust through a lawyer. I would rather spend that money on some tax stamps. I have read that it is not a good idea to create a trust using Will Maker or Legal Zoom. Is it safer to create a LLC on Legal Zoom than the trust? Or is a lawyer still the safest route? Any suggestions on how to get a legit LLC that will keep me from the arms of Bubba would be great. I recently setup an LLC in Texas but it was for an FFL. I did it myself via the states website linked to above. I will have an lawyer write up my operating agreement though. FYI. it cost $300 for an LLC in TX |
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I set up a Texas LLC in 2007 and used it to buy a two suppressors. It took me about 30 minutes online to set up the company, plus a little over $300.
You have to do some name searches to make sure your company name isn't too similar to someone else's, and this search may cost a few bucks. A state franchise tax return is required annually, even though no tax is due. When I send in a form 4, I typically pull a certificate of good standing or equivalent and a Certificate of formation to send with it––about a $30 exercise (also online). If you don't write your own operating agreement you default to codified rules in the Texas statutes, as I understand it. I have a single owner/member LLC––there may be other implications to having multi-owner LLC from a tax and legal perspective. The worst thing about the LLC was the crap junk mail and phone calls I got after forming the company. You have to put in an address and phone # for the registered agent for your LLC, and there are companies out there that sift the public records and sell the info in mailing lists. It sort of died down after about 6 months, but I still get at least one piece of junk mail every three months. Amex offered my LLC a credit card on Monday......... |
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It costs $50 in CO, $52 in UT, & $60 in GA to set up an LLC if you use the on-line forms. No tax returns need to be filed in those states if your LLD does not manufacture anything or sell anything commercially and NFA items are the only thing held in the LLC.
I don't know the details of LLCs in any other state. MadDog |
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The worst thing about the LLC was the crap junk mail and phone calls I got after forming the company. You have to put in an address and phone # for the registered agent for your LLC, and there are companies out there that sift the public records and sell the info in mailing lists. It sort of died down after about 6 months, but I still get at least one piece of junk mail every three months. Amex offered my LLC a credit card on Monday......... All too true. However, I have not had to buy a pen for the last decade –– companies are always sending me free samples engraved with my company's name.
As far as the marketing phone calls, I just tell the callers that I cannot even reveal the nature of our business unless they have a security clearance, and refer them to the U.S. Department of Homeland Security. They apologize, hang up quickly, and never call back. 
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The worst thing about the LLC was the crap junk mail and phone calls I got after forming the company. You have to put in an address and phone # for the registered agent for your LLC, and there are companies out there that sift the public records and sell the info in mailing lists. It sort of died down after about 6 months, but I still get at least one piece of junk mail every three months. Amex offered my LLC a credit card on Monday......... All too true. However, I have not had to buy a pen for the last decade –– companies are always sending me free samples engraved with my company's name.
As far as the marketing phone calls, I just tell the callers that I cannot even reveal the nature of our business unless they have a security clearance, and refer them to the U.S. Department of Homeland Security. They apologize, hang up quickly, and never call back.
Thats some good stuff there i got to remember that one... 
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The worst thing about the LLC was the crap junk mail and phone calls I got after forming the company. You have to put in an address and phone # for the registered agent for your LLC, and there are companies out there that sift the public records and sell the info in mailing lists. It sort of died down after about 6 months, but I still get at least one piece of junk mail every three months. Amex offered my LLC a credit card on Monday......... All too true. However, I have not had to buy a pen for the last decade –– companies are always sending me free samples engraved with my company's name.
As far as the marketing phone calls, I just tell the callers that I cannot even reveal the nature of our business unless they have a security clearance, and refer them to the U.S. Department of Homeland Security. They apologize, hang up quickly, and never call back.
That is pure win! |
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It costs $50 in CO, $52 in UT, & $60 in GA to set up an LLC if you use the on-line forms. No tax returns need to be filed in those states if your LLD does not manufacture anything or sell anything commercially and NFA items are the only thing held in the LLC. I don't know the details of LLCs in any other state. MadDog Don't you still have to file federal tax returns or certificates of no income? It would suck to get investigated by the IRS for not filing tax forms. |
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It costs $50 in CO, $52 in UT, & $60 in GA to set up an LLC if you use the on-line forms. No tax returns need to be filed in those states if your LLD does not manufacture anything or sell anything commercially and NFA items are the only thing held in the LLC. I don't know the details of LLCs in any other state. MadDog Don't you still have to file federal tax returns or certificates of no income? It would such to get investigated by the IRS for not filing tax forms. I don't know about LLCs, but my "S" corporation filed a federal return with all "zeroes" on it the first year, and after it went through, the IRS wrote to me saying there was no need to file in the future unless/until there is reportable income. I kept the letter and, per their instructions, have not filed anything in the last decade. Same thing for the state of Florida, where my corp is chartered. No returns unless/until there is income. The total "paperwork" requirement to maintain a corporation in Florida is to sign on to sunbiz.org once a year, report any changes in officers, address, etc. (just click the "no change" box), and pay $150 by credit card, plus $8 for them to mail a state-seal document saying the corporation is up-to-date and viable. I include a copy of that document with every Form 1/4 and they sail right through ATF/WVa. So it does cost $158/year, but no forms, and only takes two minutes to meet all requirements. |
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It costs $50 in CO, $52 in UT, & $60 in GA to set up an LLC if you use the on-line forms. No tax returns need to be filed in those states if your LLD does not manufacture anything or sell anything commercially and NFA items are the only thing held in the LLC. I don't know the details of LLCs in any other state. MadDog Don't you still have to file federal tax returns or certificates of no income? It would suck to get investigated by the IRS for not filing tax forms. My tax attorney told me that there was no need to file any sort of return unless there was a "taxable event" like selling an item for profit or other income. |
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The worst thing about the LLC was the crap junk mail and phone calls I got after forming the company. You have to put in an address and phone # for the registered agent for your LLC, and there are companies out there that sift the public records and sell the info in mailing lists. It sort of died down after about 6 months, but I still get at least one piece of junk mail every three months. Amex offered my LLC a credit card on Monday......... All too true. However, I have not had to buy a pen for the last decade –– companies are always sending me free samples engraved with my company's name.
As far as the marketing phone calls, I just tell the callers that I cannot even reveal the nature of our business unless they have a security clearance, and refer them to the U.S. Department of Homeland Security. They apologize, hang up quickly, and never call back.
That's good. I wouldn't be able to say that without laughing, due to my company name! "You have reached Varmint Control LLC. Please call back when you have the proper security code clearance provided by the Department of Homeland Security". |
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When forming a LLC, I assume all the "Members" are legally able to possess and transport the NFA items? Does one need to state that any where when forming the LLC. I like the cost factor of organizing through Colorado, but am curious what steps I need to do to make sure all is on the up and up as far as the NFA items are concerned.
I just saw where the Agent must live in the state that the LLC is formed in. What is the best method to make that work? Colorado only charges $50 for formation of the LLC , but what do I do about an agent? |
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