The following documents were prepared from the 2013, 2012, 2011 & 2010 tax returns of The General Service Board of Alcoholics Anonymous, Inc. (GSB), Alcoholics Anonymous World Services, Inc. (WS), and Alcoholics Anonymous Grapevine, Inc. (GV). Tax returns of Internal Revenue Code Section 501(c)(3) tax-exempt organizations are public documents and most of these organizations can be found on the GuideStar website.
Bill W., a co-founder of Alcoholics Anonymous in 1935, essentially stole the copyright to the Big Book (BB) of Alcoholics Anonymous (AA) in April 1939. This one action that Bill W. undertook secured his future financially.
A long story shortened, Bill W. was able to negotiate a legally executed royalty agreement for sales of the BB. The terms of the royalty agreement, in part, stipulated that as owner of the BB copyright Bill W would be paid .45 cents per BB sale. This AA royalty agreement was executed in 1963. Although the documents are unavailable at this time Bill W. was also compensated for his additional writings of AA literature.
Bill W. was paid the AA royalties due him until the date of his death. Upon the terms of his Last Will and Testament, his ownership in the AA royalties were assignable to beneficiaries of his choosing. Bill W. assigned 10% of the AA royalties to Helen Wynn (Bill Wilson's last mistress) and the remaining 90% went to his wife, Lois Burnham Wilson. Bill W. died on 1/24/1971. Bill W. was able to pass almost the entirety of his estate to his beneficiaries estate tax free. The documents provided in the link below include the estate tax detail for Bill W., as well as Lois's estate upon her death. Be forewarned that the link and documents are lengthy and complicated.
Lois Burnham Wilson passed away in October 1988. The terms of Lois's will assigned her estate to her named beneficiaries. The beneficiaries were mostly famliy members. However, 50% of Lois' interest in the AA royalty payments were assigned to the Stepping Stones Foundation. Lois had retained tax counsel in order to minimize the estate ta that her estate would have to pay to the Internal Revenue Service (IRS) as well as the state of New York. Estate planning in the United States can get extremely complicated. Suffice it to say that the tax counsel Bill W. retained did a good job (Michael Alexander & Owen J. Flanigan). Lois' estate was taxed at the highest rate in place at the time of her death (55%). Lois could only transfer a life interest in the AA royalties to individuals meeting certain criteria and the 50% AA royalty interest passed to the Stepping Stones Foundation was, generally, only good for ten years after Lois's death. Lois was able to deduct the Fair Market Value ($1,400,000) of the house that Bill W. had bought from a grieving widow of a dead alcoholic. Bill W. bought this house in 1941 at a steep, steep discount. Furthermore, certain estate tax planning techniques were employed that legally allowed a portion of the value of the AA royalty interest to be excluded altogether from Lois' estate tax return and the remaining tax value was at a discounted value.
Any sizeable estate tax return filed in the U.S. is automatically selected for audit by the IRS. The estate tax is sometimes referred to affectionately here in the U.S. as the death tax. The IRS audits all large estate tax returns because of the amount of tax dollars at stake.
The final agreed upon value of Lois's estate for IRS purposes at her death was put at approximately $3,800,000. This value does not include the excluded property nor the discounted amount applied to the remaining AA royalty payments that Alcoholics Anonymous World Services, Inc. was obligated to pay to Lois' named individual beneficiaries over their life and the amounts due to the Stepping Stones Foundation for an additional ten years after Lois' death.
http://gsowatch.aamo.info/bill/w041.gif (Lois' estate tax return page)
http://gsowatch.aamo.info/bill/w025.gif (Lois' will assigning Stepping Stones royalties)
http://gsowatch.aamo.info/bill/w.pdf (Entire file of the Wilson's estate documents)