Willie Nelson was far more successful at picking songs than picking accountants. In 1990 the Internal Revenue Service seized most of his assets, saying he owed $32 million in back taxes.
Nelson blamed his accountant, who had placed his assets in a tax shelter that the IRS ruled was illegal. He also learned that his accountant hadn’t paid his taxes over the years. Nelson’s lawyer negotiated the debt down to $6 million plus interest, but he didn’t have that kind of money thanks to extravagant spending and bad investments in the 1980s.
Then, Nelson had an idea. He would make an album, with all the money going to the IRS. The album called “The IRS Tapes: Who’ll Buy My Memories?” went on sale June 3, 1991. There was no band, it was just Nelson and his guitar. Most of the songs were ones he’d already recorded. He co-wrote the Song of the Day, “Who’ll Buy My Memories?” in 1963.
At the time, the only way to purchase the tape was by calling the phone number, 1-800-IRS-TAPE. His record company loved the album. It started selling in stores. The IRS got $3.6 million from the proceeds. To get the rest of the $6 million, the IRS figured it could auction off Nelson’s real estate and possessions. Boy, was the government wrong. It got a taste of how beloved Nelson was.
When the IRS put his items up for auction no one bid on the most valuable stuff. His ranch in Austin, Texas was on the block for two days until a doctor won it with a low-ball bid. The doctor then sold it back to Nelson at the same price. Other bidders returned many of his possessions. His final payment to the IRS was in 1993.
Nelson never lost his sense of humor about his taxing situation. He even did a commercial for H&R Block in 2004 that played during the Super Bowl.
