How Willie Nelson Ended Up Owing the IRS $16.7 Million

Willie Nelson, the famous musician and actor, has been bringing us stunning country music for decades. Despite being close to his nineties, he is still healthy and active. Leading such a long and eventful life, it’s no wonder that he had some exciting tax adventures as well.

He is often included on many lists of the most famous celebrities with tax troubles. He ended up owing a total of $16.7 million to the IRS! Now, that’s a lot of money, and the whole story is quite interesting as well. Let’s take a look.

How Willie Got into Trouble with the IRS

Willie was already well into his prime when his troubles with the IRS began. In 1990, the IRS suddenly seized almost all of Nelson’s assets as they claimed he owed the country a total of $32 million. Were that not enough, Nelson was already having problems due to several bad investments he made during the 80s.

He was naturally unwilling and unable to pay such a massive debt, but thankfully, his famous lawyer Jay Goldberg was able to half the sum. However, this still wasn’t enough for the legendary country singer, so his lawyer did the impossible. He renegotiated the price and got the IRS to go down to $6 million, but Nelson refused the agreement.

How about an Album for the IRS?

Willie Nelson was unwilling to pay his debts the regular way, so he decided to do an interesting thing. He made and released an album he dubbed The IRS Tapes: Who’ll Buy My Memories? The album was clearly made to pay off the debt he had, but despite that, it turned out to be a great album nevertheless! Critics praised it, and so did the fans, judging by the fact that the album generated around $3.6 million. All of the money went towards paying off the IRS debt.

However, despite the album’s success, Willie still needed more money as the IRS demanded he pay some $9 million more. Nelson’s fans and his friends helped him out by taking the album’s title literally, and buying off Nelson’s stuff in auctions. A lot of the larger assets were returned to him for a nominal fee.

Nelson eventually managed to pay off his debts when he combined all of that money, plus an undisclosed sum from a lawsuit he settled with his former accountant Price Waterhouse. It turned out that his accountant was the one who got him into trouble by not paying Willie’s taxes for years.

In 1993, three years after his problems began, Willie was finally done with the IRS as he paid off all of his debts.

Key Takeaways

You can love him or hate him for what he did, but you have to agree that the way he managed to pay off his debts was somewhat ingenious.

If you like this story, you’ll love the rest of the celebrity tax trouble stories we have on our blog. What’s more, Golden Tax Relief is not just there to give you stories, but to help you out with IRS troubles of your own! Take a look at how we do it if you want to know more.

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