Providing this as an informational resource to document what I wish had shown up in the search results: a brief discussion of what a "Schedule A" is, why some people seem to insist on needing it and others swear by not having it, and how to figure out if you need one and what to put on it.
<span style="font-weight: bold">Whats the problem?</span>
Since 2007, the ATF has been enhancing their ability to review trusts as part of NFA related applications. Most recently last year, this has included dividing the application pool into examiners aligned to specific geographic areas. The idea being that individual examiners would be able to build subject matter expertise in the trust law of the states for which they are responsible.
One of the questions that has come up in the last few years are applications which are being stopped with an error letter requesting something called a "Schedule A".
Researching the issue online, there is a lot of feedback that says you need one, a lot of feedback out there that swears you don't, and not many places where they explain what it is and how it relates to the trust.
<span style="font-weight: bold">The Legal Piece</span>
I am not a lawyer.
This is not legal advice. I am simply sharing my experience in the hope that I can save some people some frustration by adding one good search engine response the next time someone searches on this topic.
The "you" I reference here repeatedly is the expository term of the word, meaning the person taking a specific action, in most cases referring to myself in considering these questions, forming my trust, and making my decisions as they apply to me.
When dealing with trusts and the law, consult an attorney. Not just any attorney, but one familiar with NFA issues AND the trust law of your state. Remember: Get it wrong and if ever the authorities have reason to investigate, you could conceivably go to jail.
<span style="font-weight: bold">What is a Schedule A?</span>
When the notion of an NFA trust caught on a few years back, a number of firearms owners used a commercial application like Quicken Willmaker to generate the trust that would hold NFA items. There is some debate as to whether that is a good strategy - which I will not get into here.
Regardless, one of the key tenents of a trust is that the trust does not exist (does not have a "body" if you want to think of it that way) until something is put into the trust. From a legal standpoint, that means that something (money, guns, whatever) has to be put into the trust BEFORE it is used as the legal instrument to be approved as an NFA instrument.
The way that these software programs dealt with this requirement was to reference something called "Schedule A" where the person using the software could list what the trust owns in order to establish the trust.
To understand the significance of this, we have to talk about a few things.
<ul style="list-style-type: disc">[*]In a legal instrument, a schedule is sort of an "atttachment" which is referred to by the parent instrument. "A" is simply the identifier of the additional paper. It could be called "Schedule PurplePeopleEater12345" if you wanted to write that into the trust. The software called it "Schedule A" so "Schedule A" is what you see commonly referred to.[*]If you have a schedule referred to in the body of the trust itself, depending on how its worded, the schedule is incorporated as part of the trust. Anyone reviewing the trust needs to know what is in that Schedule A. If you say that the trust ONLY contains what is in that Schedule A, for example, the ATF might say well I don't see XYZ here so this trust is irrelevant to the XYZ that you want to transfer. The response to which of course is that it hasn't been transferred yet, so you would amend the schedule A later. If nothing else is in the trust, you would provide a blank schedule A.[/list]
Schedule A is simply a software package's (or an attorney's) arbitrary reference to the list of property that is included in the trust.
<span style="font-weight: bold">I see a lot of people saying having a Schedule A is bad, whats that about?</span>
If you have used software or a professional that has constructed a trust that referenced a schedule A, and you have things that are non-NFA firearms in the trust, you risk exposing things to the ATF that perhaps you do not want to.
For example, if you have a trust that owns 5 firearms. Only 1 of which is an NFA regulated firearm, by providing a schedule A that includes all of the other firearms, some people take the perspective that you are, de facto, participating in registration and correlation of your trust's firearms ownership.
Legally, in most states you have to have some documentation that keeps track of the assets in the trust, so that documentation has to exist.
The question is, should/was your trust built such that you have to provide that schedule of assets to the ATF to process your application?
<span style="font-weight: bold">Do I need to include a schedule A?</span>
Reminder: Consult a lawyer for legal advice, this is my shared decision making process, not legal advice.
When I looked at my trust, the key was to <span style="font-weight: bold"><span style="font-style: italic">understand what my trust said</span></span>. If you have signed, certified, and intend to submit a legal document you do not understand, you may need some help.
Does your trust refer to something as a "schedule" such and such? Do you have that schedule? Do you know what is supposed to be on that schedule? Can you make that schedule?
If the trust refers to an external "exhibit" or "schedule" the ATF will likely want to ask for that schedule in order to be able to fully process the trust's NFA transfer request.
If your trust does not refer to an "exhibit" or "schedule" then you should have some sort of instrument of transfer to indicate that the asset under discussion for transfer is going into the trust, and the schedule of pre-existing assets may not be necessary to submit.
<span style="font-weight: bold">What goes on a schedule A or schedule of assets?</span>
The easiest way to make a schedule A is to do one of two things:
<ul style="list-style-type: disc">[*]See if your software or attorney provides one
[*]Make a simple spreadsheet and title it Schedule of Trust Assets. Remember that schedule A is a reference in the trust that the software or attorney made. So if you trust doesn't specify what it should be named, its just a list of trust assets and we want to name it a straightforward name for clarity's sake. We don't have to call it "Schedule A" because its not the "A" schedule related to anything.[/list]
If you have software that referred to a schedule A or an attorney which drafted your trust, they should provide at least a template of some kind for what that Schedule A should look like. That would be the first place to start.
In the alternative, if you want to build an asset schedule from scratch, essentially what you want to do is title it as a schedule of trust assets. Include the name of the trust. Each line should contain some information about the asset. If its cash, list the amount. If its a firearm, include make, model, and serial number. Other property should have minimum asset information provided.
One of the most common questions that I have seen around this schedule is: do I list the item being transferred? Here is how I approach it: Does my trust already possess the item?
<ul style="list-style-type: disc">[*]If the item is already owned by me and in my posession and I want to make a change: I list it. Example: I want to "manufacture" an SBR on a rifle lower I already have. I would list the rifle as an existing asset of the trust.
[*]If the item is not yet in the possession of my trust, I do not list it. Example: Suppressor/Silencer, already manufactured NFA item (form 4), etc which I am trying to transfer, by this application, into my trust.[/list]
This is where the whole question about privacy comes up. If your trust is structured such that a document like this has to be submitted, remember that anything you are putting on this document will be known to the government. I don't consider that a horrible thing, necessarily, but I know others hold different views.
I have also seen discussion about redacting your list that is submitted to the ATF. I am not a lawyer, consult one before you do something like that as to what you can redact and how it must be done.
<span style="font-weight: bold">If I don't have to submit a schedule A, should I have such a thing?</span>
Even if you are not required to submit a "Schedule A" or a "Schedule of Trust Assets", whatever applies, its generally a good idea to keep records in the trust documentation of what the trust actually contains. Consult an attorney if you are unsure, because some states legally require this kind of basic record keeping, and indeed other states have specific requirements of what they have to contain and how they have to be stored.
For example, in PA, some trust records have to be stored in a location separate from the trustee and/or executor, and both an asset list and transaction list may need to be maintained. State law varies substantially and an attorney can guide you as to what you need locally.
As a best practice, even if you are not required by state law to have them, it may be a good idea. Remember that one of the intents of a trust can be to hold assets through your death, etc. An executor or successor trustee (whichever applies) will need some kind of records to know what the trust holds and what to do with those assets.
<span style="font-weight: bold">Finally</span>
When in doubt, or you feel over your head? Consult a real attorney, not some software.
<span style="font-weight: bold">Whats the problem?</span>
Since 2007, the ATF has been enhancing their ability to review trusts as part of NFA related applications. Most recently last year, this has included dividing the application pool into examiners aligned to specific geographic areas. The idea being that individual examiners would be able to build subject matter expertise in the trust law of the states for which they are responsible.
One of the questions that has come up in the last few years are applications which are being stopped with an error letter requesting something called a "Schedule A".
Researching the issue online, there is a lot of feedback that says you need one, a lot of feedback out there that swears you don't, and not many places where they explain what it is and how it relates to the trust.
<span style="font-weight: bold">The Legal Piece</span>
I am not a lawyer.
This is not legal advice. I am simply sharing my experience in the hope that I can save some people some frustration by adding one good search engine response the next time someone searches on this topic.
The "you" I reference here repeatedly is the expository term of the word, meaning the person taking a specific action, in most cases referring to myself in considering these questions, forming my trust, and making my decisions as they apply to me.
When dealing with trusts and the law, consult an attorney. Not just any attorney, but one familiar with NFA issues AND the trust law of your state. Remember: Get it wrong and if ever the authorities have reason to investigate, you could conceivably go to jail.
<span style="font-weight: bold">What is a Schedule A?</span>
When the notion of an NFA trust caught on a few years back, a number of firearms owners used a commercial application like Quicken Willmaker to generate the trust that would hold NFA items. There is some debate as to whether that is a good strategy - which I will not get into here.
Regardless, one of the key tenents of a trust is that the trust does not exist (does not have a "body" if you want to think of it that way) until something is put into the trust. From a legal standpoint, that means that something (money, guns, whatever) has to be put into the trust BEFORE it is used as the legal instrument to be approved as an NFA instrument.
The way that these software programs dealt with this requirement was to reference something called "Schedule A" where the person using the software could list what the trust owns in order to establish the trust.
To understand the significance of this, we have to talk about a few things.
<ul style="list-style-type: disc">[*]In a legal instrument, a schedule is sort of an "atttachment" which is referred to by the parent instrument. "A" is simply the identifier of the additional paper. It could be called "Schedule PurplePeopleEater12345" if you wanted to write that into the trust. The software called it "Schedule A" so "Schedule A" is what you see commonly referred to.[*]If you have a schedule referred to in the body of the trust itself, depending on how its worded, the schedule is incorporated as part of the trust. Anyone reviewing the trust needs to know what is in that Schedule A. If you say that the trust ONLY contains what is in that Schedule A, for example, the ATF might say well I don't see XYZ here so this trust is irrelevant to the XYZ that you want to transfer. The response to which of course is that it hasn't been transferred yet, so you would amend the schedule A later. If nothing else is in the trust, you would provide a blank schedule A.[/list]
Schedule A is simply a software package's (or an attorney's) arbitrary reference to the list of property that is included in the trust.
<span style="font-weight: bold">I see a lot of people saying having a Schedule A is bad, whats that about?</span>
If you have used software or a professional that has constructed a trust that referenced a schedule A, and you have things that are non-NFA firearms in the trust, you risk exposing things to the ATF that perhaps you do not want to.
For example, if you have a trust that owns 5 firearms. Only 1 of which is an NFA regulated firearm, by providing a schedule A that includes all of the other firearms, some people take the perspective that you are, de facto, participating in registration and correlation of your trust's firearms ownership.
Legally, in most states you have to have some documentation that keeps track of the assets in the trust, so that documentation has to exist.
The question is, should/was your trust built such that you have to provide that schedule of assets to the ATF to process your application?
<span style="font-weight: bold">Do I need to include a schedule A?</span>
Reminder: Consult a lawyer for legal advice, this is my shared decision making process, not legal advice.
When I looked at my trust, the key was to <span style="font-weight: bold"><span style="font-style: italic">understand what my trust said</span></span>. If you have signed, certified, and intend to submit a legal document you do not understand, you may need some help.
Does your trust refer to something as a "schedule" such and such? Do you have that schedule? Do you know what is supposed to be on that schedule? Can you make that schedule?
If the trust refers to an external "exhibit" or "schedule" the ATF will likely want to ask for that schedule in order to be able to fully process the trust's NFA transfer request.
If your trust does not refer to an "exhibit" or "schedule" then you should have some sort of instrument of transfer to indicate that the asset under discussion for transfer is going into the trust, and the schedule of pre-existing assets may not be necessary to submit.
<span style="font-weight: bold">What goes on a schedule A or schedule of assets?</span>
The easiest way to make a schedule A is to do one of two things:
<ul style="list-style-type: disc">[*]See if your software or attorney provides one
[*]Make a simple spreadsheet and title it Schedule of Trust Assets. Remember that schedule A is a reference in the trust that the software or attorney made. So if you trust doesn't specify what it should be named, its just a list of trust assets and we want to name it a straightforward name for clarity's sake. We don't have to call it "Schedule A" because its not the "A" schedule related to anything.[/list]
If you have software that referred to a schedule A or an attorney which drafted your trust, they should provide at least a template of some kind for what that Schedule A should look like. That would be the first place to start.
In the alternative, if you want to build an asset schedule from scratch, essentially what you want to do is title it as a schedule of trust assets. Include the name of the trust. Each line should contain some information about the asset. If its cash, list the amount. If its a firearm, include make, model, and serial number. Other property should have minimum asset information provided.
One of the most common questions that I have seen around this schedule is: do I list the item being transferred? Here is how I approach it: Does my trust already possess the item?
<ul style="list-style-type: disc">[*]If the item is already owned by me and in my posession and I want to make a change: I list it. Example: I want to "manufacture" an SBR on a rifle lower I already have. I would list the rifle as an existing asset of the trust.
[*]If the item is not yet in the possession of my trust, I do not list it. Example: Suppressor/Silencer, already manufactured NFA item (form 4), etc which I am trying to transfer, by this application, into my trust.[/list]
This is where the whole question about privacy comes up. If your trust is structured such that a document like this has to be submitted, remember that anything you are putting on this document will be known to the government. I don't consider that a horrible thing, necessarily, but I know others hold different views.
I have also seen discussion about redacting your list that is submitted to the ATF. I am not a lawyer, consult one before you do something like that as to what you can redact and how it must be done.
<span style="font-weight: bold">If I don't have to submit a schedule A, should I have such a thing?</span>
Even if you are not required to submit a "Schedule A" or a "Schedule of Trust Assets", whatever applies, its generally a good idea to keep records in the trust documentation of what the trust actually contains. Consult an attorney if you are unsure, because some states legally require this kind of basic record keeping, and indeed other states have specific requirements of what they have to contain and how they have to be stored.
For example, in PA, some trust records have to be stored in a location separate from the trustee and/or executor, and both an asset list and transaction list may need to be maintained. State law varies substantially and an attorney can guide you as to what you need locally.
As a best practice, even if you are not required by state law to have them, it may be a good idea. Remember that one of the intents of a trust can be to hold assets through your death, etc. An executor or successor trustee (whichever applies) will need some kind of records to know what the trust holds and what to do with those assets.
<span style="font-weight: bold">Finally</span>
When in doubt, or you feel over your head? Consult a real attorney, not some software.
