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Willie Nelson Reaches Agreement with IRS Over $15.6 Million Debt

February 3, 1993

AUSTIN, Texas (AP) _ Willie Nelson and the Internal Revenue Service agreed Tuesday to a $9 million settlement on $15.6 million in back taxes and penalties owed by the country singer.

″I’m on the road - still,″ said a smiling Nelson, playing off of his famous tune ″On The Road Again.″

The deal comes after Nelson and the IRS agreed to market an album - ″Who’ll Buy My Memories?: The IRS Tapes″ - to help Nelson make liability payments.

Nelson, 59, refused to file for bankruptcy protection and said he has paid the IRS more than $6 million since 1990. He has worked double time over the past year to help pay off his debts.

Much of the remaining debt, due in five years, will come from the album’s proceeds and any judgment he might win in a lawsuit against his former accountant, Price Waterhouse, said Nelson’s attorney, Larry Goldfein.

Mike McDermitt, chief collection division of the IRS in Austin, said: ″We applied the same criteria to Mr. Nelson’s offer that would apply to any taxpayer. He did not receive favorable treatment.″

Nelson’s trouble began in the early 1980s, when he invested heavily in tax shelters. The IRS disallowed the claims and later sued for unpaid taxes.

Nelson blames Price Waterhouse in a federal court lawsuit for giving him bad advice about the shelters. The investment firm said Tuesday that Nelson made the decision to buy into the shelters himself.

In 1990, the IRS raided Nelson’s bank accounts and seized property, including the Pedernales Country Club west of Austin and a 44-acre ranch and house in Dripping Springs.

Nelson has developed a reputation for organizing benefits such as the Farm Aid concerts to provide relief for struggling farmers. Some of his assets auctioned off by the IRS, including the 44-acre Texas ranch, were bought and given back to Nelson by friends and fans.

″Everyone came to my defense and that was overwhelming,″ Nelson said.

Other hits by Nelson include ″Always On My Mind,″ ″Mama, Don’t Let Your Babies Grow Up To Be Cowboys″ and ″Blue Eyes Cryin’ in the Rain.″

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