Think judges of the U.S. Tax Court are staid? Well, yes, probably. But in 1983, one of them cut loose with a rhyming opinion in a case involving country singer Conway Twitty’s defunct “Twitty Burger” restaurants:
Twitty Burger went belly up
But Conway remained true
He repaid his investors, one and all
It was the moral thing to do.
His fans would not have liked it
It could have hurt his fame
Had any investors sued him
Like Merle Haggard or Sonny James.
When it was time to file taxes
Conway thought what he would do
Was deduct those payments as a business expense
Under section one-sixty-two.
In order to allow these deductions
Goes the argument of the Commissioner
The payments must be ordinary and necessary
To a business of the petitioner.
Had Conway not repaid the investors
His career would have been under cloud,
Under the unique facts of this case
Held: The deductions are allowed.
Interesting factoids in the opinion include the revelations that Conway Twitty’s real name was Harold Jenkins and that he began his career in rock and roll before crossing over to country music in 1965.
— Jenkins v. Comm’r, 47 T.C.M. (CCH) 238 (T.C. 1983). Thanks to Professor Jose Gabilondo.