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This is the first in our series "From the Vault: Financial Analysis of the Sometimes Rich and Famous," an ongoing ReZoom.com Finance feature that spotlights well-known boomers and their money.

The Party's Over

In 1985, country music legend Willie Nelson was riding high in the saddle. After winning huge crossover success the previous year with "To All the Girls I've Loved Before," a duet with Julio Iglesias, he launched Farm Aid, a benefit concert that raised millions for America's rural families. But in 1986, the IRS stuck him with a bill for $2 million, claiming he owed back taxes on concerts and royalties. Nelson and his team of accountants had dealt with minor tax problems in the past, but what made this case different was that the government was claiming he had taken improper deductions for losses claimed on investments and business expenses, "fraudulently and with intent."

Why Not Take All of Me

Consultants convinced Nelson that, instead of borrowing $2 million to pay back the IRS, he should borrow $12 million, invest it in a cattle feeding venture and pay the IRS with whatever profits it made. Despite the implied expertise of his handlers, Nelson was basically throwing good money after bad, placing himself deeper in the hole by attempting to painlessly remedy the problem.

The cattle feeding venture crashed within four years, and by the end of the 1980s, Shotgun Willie was staring down the barrel of a $16.7 million tax lien on a $32 million bill. In 1990, government agents conducted a sweep of his home and businesses, confiscating furniture and memorabilia and padlocking his front door.

Released to help pay off a $16.7 million debt, "The IRS Tapes" sold well despite the lack of hit tunes.

Living in a friend's guest bedroom and frantic to come up with a solution to the problem, Nelson proposed a musical venture in late 1990. Hence the release of "The IRS Tapes: Who'll Buy My Memories?" a 24-track collection of demos, studio outtakes and other rarities. All profits made on the record went to the IRS, but it hardly put a dent in what Nelson owed, so auctions of the singer's personal property were scheduled.

Then, in a Frank Capra-meets-Beverly Hillbillies twist, friends and fans of Nelson came to his aid. When the IRS held an auction on the singer's 700-acre ranch in January of 1991, a West Texas couple successfully bid on the title to the house and held it until Willie was able to pay it back. Similar bailouts were made on his publishing business and country club property.

Finally, in February, 1993, the IRS agreed to a nine million dollar settlement and a payback schedule without additional interest. Later that year, Nelson enjoyed an artistic comeback with "Across the Borderline," which featured duets with friends Bob Dylan, Sinead O'Connor and Bonnie Raitt.