• Identify This Investment

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    I need help to identify a mystery investment.

    My grandmother is a wealthy woman who has always had access to professional financial advice. About twenty years ago she set up some sort of estate plan that involved her children and grandchildren, including me. An account was set up for each of us. She has never spoken of it to me, but I am aware of its existence because I have been paying taxes on it every year. Now that I am an adult, and would like to have an accurate understanding of my finances, I am trying to identify this investment.

    Here’s what I know:
    The investment is in her name, and I am also identified in some capacity. The investment earns around $300 a year in dividends and these are withdrawn by my grandmother. The dividends have been pretty constant, leading me to believe that the account value is also pretty stable. I pay the taxes on the dividends every year. I know that my grandmother had a good financial planner who may have helped her use some complicated or rare investment strategies or products. I have passed all the “milestone” adult birthdays, such as 18 and 21, without her mentioning the account to me, so I now believe it is meant to transfer to me after her death. However, she did transfer ownership of my parents account several years ago. My parents liquidated the account and paid off about $20,000 in debt. (My parents don’t know much about finance and don’t know what kind of account it was.)

    Here’s what I suspect:
    I know that you can use a “charitable remainder trust” to make a donation to a charity, whereby you get the tax deduction for the gift but you get to hold the assets and profit from the gains until your death. I suspect she may have set up something similar for us.

    Why not just ask grandma about it? Because I love her and respect her. If she wanted to discuss it with me, she would have. I think it would be in very poor taste to inquire about what I now believe is part of her will. On the other hand, I feel that I have a right to know why I am paying my grandmother’s taxes every year. So rather than ask her, I am asking all you educated personal finance bloggers to help me solve the mystery discreetly.

    I want to know…
    What kind of investment is this? How much might it be worth? How might this affect me (with taxes and other regulations) when I do become the owner of the account? Is this an investment I could hold and grow or something I would have to liquidate upon receipt?


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