Harold Jenkins, more commonly known by his stage name, Conway Twitty (Twitty) (plaintiff), was a well-known country music entertainer. Twitty and many of his friends, most of whom were also in the country-music business, started a restaurant called Twitty Burger. Twitty Burger failed miserably, and many of the investors lost their money. Although Twitty was under no business obligation to reimburse these investors, Twitty decided, for both reputational and moral purposes, to pay the investors back with his own money. Twitty deducted the reimbursements as business expenses from his country-music income. The commissioner of internal revenue (defendant) determined that these expenses were not deductible. Twitty petitioned for a redetermination in the United States Tax Court.