The Paul Allen empire includes a dizzying interplay of for-profit and philanthropic endeavors. His death raises a host of business succession planning and taxation questions, all with significant implications for the city and region Allen loved.

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The empire Paul Allen built in the 35 years after he left Microsoft has few equals in size or in local impact on the city and region that he loved.

Even as commemoration plans take shape, questions are swirling around his immense fortune, estimated to be more than $20 billion, and the long-term future of the many major cultural, scientific and commercial landmarks he left in Seattle and beyond.

The disposition of what is likely to be the largest estate in Washington history will help determine the future of local museums and arts festivals, brain science and artificial intelligence research institutes, sports teams and an enormous real-estate portfolio. Allen’s philanthropic commitments also present a potentially transformative infusion of funding to the eventual recipients. The Internal Revenue Service, too, will be poring over it all.

While Allen’s wishes can be interpreted from his statements and actions — pledging in 2010 to give away the majority of his wealth, for example — the details of how they will be executed have not yet been made public. Indeed, they may never be, given the privacy protections in estate law.

Paul Allen: 1953-2018

There is familial continuity built in to the structure of Allen’s empire. Many of his post-Microsoft endeavors were carried out in close collaboration with or led by his sister, Jody Allen. He was not married and had no children.

She co-founded and was until 2014 the CEO of Vulcan Inc., the holding and investment company at the center of the Allen empire. She is listed on dozens of active business registrations associated with Allen and Vulcan endeavors, heads the Paul G. Allen Family Foundation and was the driving force behind creation of MoPOP, where she is president of the board.

Bill Hilf, the technology executive tapped to lead Vulcan in 2016, sought to reassure the many stakeholders in the Allen empire in a statement released shortly after his death Monday.

“Paul thoughtfully addressed how the many institutions he founded and supported would continue after he was no longer able to lead them,” Hilf said, adding that it was too soon to deal with the specifics. “We will continue to work on furthering Paul’s mission and the projects he entrusted to us. There are no changes imminent for Vulcan, the teams, the research institutes or museums.”

But there are early signs of how various pieces of the Allen empire have been subtly restructured to operate more independently. And rumors have already started about possible sales of Allen’s sports franchises, the Seahawks and Portland Trail Blazers.

At the center of the Allen empire is Vulcan Inc., now with more than 800 employees. It was established in 1986 and has grown to include at least 16 other named organizations — both for-profit endeavors and nonprofit museums and research institutions — and many other entities that served Allen’s private needs and interests.

Behind the Vulcan headquarters’ distinctive waterfall-of-glass facade in the International District are a personal investment management office for a multibillion-dollar fortune, security and household staff, a real-estate development operation with more than $2 billion in assets, and technologists working on everything from Allen’s personal projects and ideas to Stratolaunch, a massive plane for launching rockets into space.

Former employees say the links between various efforts at Vulcan have been tenuous at best, and were subject to Allen’s passions and occasionally shifting priorities. “The complexity of his business entities and how that all gets handled is difficult to imagine,” a former employee said of the effort to deal with his estate.

Vulcan’s varied endeavors are intermingled with an even larger set of for-profit corporations, limited liability companies and nonprofits registered in Washington state and abroad — a paper trail reflecting the global scope and breadth of Allen’s interests.

Most of these are strictly private enterprises and, as such, limited information is available in public records beyond the governing persons — typically including Jody Allen; Allen Israel, Paul Allen’s longtime personal attorney and friend; and individual Vulcan executives such as executive vice president and general counsel David Stewart and Ada Healey, head of Vulcan Real Estate.

The Allen-founded nonprofits do report some financial information publicly.

Among the oldest of these is the Allen Institute for Brain Science, which was founded in 2003 and has grown quickly in recent years in its South Lake Union home to more than 400 employees.

Allen seeded the institution with an initial $100 million, and his outlays have likely exceeded that total in recent years as the group grew. Excluding government grants, donations were $286 million in 2016, up from just $56 million two years earlier, according to the institute’s tax filings, which don’t specify the funds’ source.

The nonprofit spent $87 million in 2016, and was sitting on $336 million in savings and short-term investments at the end of the year.

In 2014, Allen founded two more institutes, focused on artificial intelligence and cell science. His public commitments to the two total more than $225 million.

Oren Etzioni, CEO of the Allen Institute for Artificial Intelligence, said the organization, which is an independent nonprofit, would have funds going forward as part of a 10-year plan established last year.

“Operationally, it is business as usual,” Etzioni said, noting wistfully that without Allen’s big ideas and questions it would never again be completely business as usual.

Allen’s museums — MoPOP (formerly the Experience Music Project), the Living Computers museum, and the Flying Heritage collection — require less ongoing support than spendy research laboratories, but have been propped up by contributions from Allen through Vulcan.

The plan for the bunch, computer museum director Lath Carlson said, was to “get them to the point of running pretty well, and then spin them off more independently.”

In recent years, that meant applying for a change in the structure of the tax-exempt nonprofits, from private foundations, which typically draw funding from a single funder, to public charities that rely more on ticket sales or other outside donors and are freed from some operational constraints.

MoPOP made that leap first. Admission fees at the Seattle Center pop culture museum accounted for about 68 percent of the museum’s revenue in 2016. That’s on the high end for museums, some of which rely almost exclusively on endowments.

The Flying Heritage & Combat Armor Museum, Allen’s collection of military aircraft and tanks on display at Everett’s Paine Field, converted to a public charity this year. The Living Computers museum, whose collection of restored computers is a mix of donated equipment and Allen’s personal collection on loan, received approval from the IRS to switch to a public charity last month.

“The big takeaway is that, in the short term, pretty much nothing changes,” Carlson said of plans after Allen’s death. As for the long term, he said, Allen had invested plenty of time and money in setting up his museums.

“One would imagine the intent was for them to be around for years to come,” he said.

Estate taxes

Creating and executing the legal and financial structures to make that intent a reality would be the ongoing work of an army of attorneys, accountants and financial planners.

Large, complex estates’ assets are often moved into what’s known as a revocable living trust. A legal entity engineered to administer an estate, a trust serves in place of a will, but isn’t subject to the traditional court process of probate. That means assets may be distributed to beneficiaries more rapidly than under a will, and with little public access— something that would have appealed to the intensely private Allen.

But even the best-laid estate plans go off the rails, said estate planning experts. For example, the non-public nature of the trust could be altered if the trust is legally challenged by a beneficiary or heir.

The biggest hurdles will almost certainly involve estate taxes. Large estates can face a combined federal and state estate tax rate as high as 52 percent — and large tax bills that can force the hurried sales of businesses or other assets, said Douglas Lawrence, a lawyer whose practice includes planning and probate matters at the law firm Stokes Lawrence.

“It all boils down to: What’s the value of that enterprise?” Lawrence said.

Both the Internal Revenue Service and the state Department of Revenue will likely dispatch teams of auditors to look over the Allen estate and determine its value — a task one local tax attorney said could “overwhelm the state Department of Revenue.”

Lawrence and other local tax experts expect the process to take a full nine months — and won’t be surprised if the estate asks tax authorities for an extension.

Experts point to one other critical issue that the estate will likely confront. Assets such as real estate and professional sports teams, which are highly valued and therefore incur a high estate-tax bill but are not at all liquid, often force estate sales or other measures to come up with the tax payment.

“In real-estate companies, you have massive portfolios of significant commercial properties that are worth hundreds of millions of dollars,” Lawrence said, but those assets “do not represent hundreds of millions in the bank.”

Giving it away

Other big questions surround Allen’s philanthropy.

In 2010, he was among the first group of billionaires to join Bill and Melinda Gates and Warren Buffett in signing the Giving Pledge, a commitment to give away the majority of their wealth to charitable or philanthropic causes during their lifetimes or in their wills. In the news release announcing the pledge, organizers describe it as “a moral commitment to give, not a legal contract.”

Allen’s estimated net worth at the time was $13.5 billion; it was estimated this year by Forbes at $20.3 billion.

Allen during his life gave away more than $2.3 billion, according to the Chronicle of Philanthropy, which regularly put him on its list of top donors. Allen’s giving was as eclectic as his interests, channeled through myriad discrete contributions, his own Paul G. Allen Family Foundation and Paul G. Allen Philanthropies, and other means.

The form and size of the philanthropy that emerges from the Allen estate to make good on his Giving Pledge could have an enormous impact on its eventual recipients.

Jeff Raikes, an early Microsoft employee and Allen friend who went on to spend five years as the CEO of the Gates Foundation and now runs a charitable foundation with his wife, Tricia, said it’s probably easy to give away huge sums of money if your only goal is to dispense with it.

“It’s very hard to do it with the intent to really make a difference in society,” Raikes said, adding that he thinks that’s how Allen was doing it.

Seattle Times business reporter Rachel Lerman contributed reporting.