It’s part two of a taxgirl double-header! I’m wrapping up my summer of movies and tax with two more features.

The final feature in the series is the 1994 film, The Shawshank Redemption. It has been consistently voted one of the top movies in American cinema and was nominated for seven Academy Awards (Best Actor in a Leading Role, Morgan Freeman; Best Cinematography, Roger Deakins; Best Film Editing, Richard Francis-Bruce; Best Music – Original Score, Thomas Newman; Best Picture, Niki Marvin; Best Sound, Robert J. Litt, Elliot Tyson, Michael Herbick and Willie D. Burton; Best Writing – Screenplay Based on Material from Another Medium, Frank Darabont).

Unlike the earlier feature in my double play, The Shawshank Redemption is not based on a true story. It’s pure fiction by author Steven King.

And this review contains HUGE spoilers. If you haven’t yet seen the film (have you been hiding under a rock – guffaw!) then you may wish to skip the review.

The Background

The film is narrated by Ellis Boyd “Red” Redding (played by the incomparable Morgan Freeman who made me cry in Driving Miss Daisy).

Banker Andy Dufresne (played by loopy yet talented Tim Robbins) is convicted of murdering his wife and her lover, a golf pro from the nearby country club. He admitted during trial that he had purchased a gun with the intention of killing his wife – but claimed to have chickened out and fled. His wife and her lover were found dead the next morning.

In most states, those who are convicted for murder are not allowed to “benefit” from the killings – this means that Andy could not have received life insurance proceeds or assets from his wife’s estate. These laws, which are the result of public policy, are referred to as “slayer’s statutes.” I’ve often wondered – if a conviction is later set aside – whether there is any economic remedy available to the otherwise beneficiary of the estate (in theory, the money would be gone, no?)…

But no such luck applies to Andy. Deemed an “icy and remorseless man” by the judge, he is sentenced to two life terms at Shawshank Prison.

The Hardships

Life at the prison is harsh. The chief prison guard, Captain Byron Hadley (played by Clancy Brown, whose voice has led him to be cast as a villain in many movies – and as Mr. Krabs in SpongeBob Square Pants) is terribly cruel. He threatens Andy as he arrives at the prison. And, on Andy’s first night at the prison, an encounter with Captain Hadley leaves another inmate dead.

Andy eventually meets Red, who was recently rejected for parole. Red is serving a life sentence and is well known throughout the prison as the “man who knows how to get things.” Andy and Red become friends after Andy asks Red to get him a rock hammer so that he can continue his rock collecting hobby.

The First Years

Andy keeps to himself and is considered a bit stand-offish. Staying to himself doesn’t keep him safe, however, and he is regularly sodomized by a group of prisoners referred to as the “bull queers” or “Sisters.” This continues for a period of two years. Andy is constantly bruised – he fights each time. It is clear that life is not kind to Andy in prison.

The Job

Andy was originally vice president of a large bank in Maine. When Hadley comes into some money, he is concerned about the tax consequences. Worried, he confides to his colleagues, “Uncle Sam puts his hand in your shirt and squeezes your tit till it’s purple.”

While out on work detail, Andy hears the discussion and decides to take matters into his own hands. He suggests that Hadley take advantage of a tax loophole that would allow him to make a tax free gift to his spouse. I will admit to being a little hazy as to what Andy suggests – it is, I guess a pre-1970s tax rule. Generally, inheritances of less than the exemption (this inheritance was only $35,000) are federal estate tax-free. Many states, like Pennsylvania and New Jersey, where I practice, have alternate death taxes. There are no income tax consequences for inherited money unless the redemption of the inheritance is, itself, a taxable event – meaning cashed in savings bonds with built-in interest, IRA withdrawals, etc. So, I am not quite sure what the Hadley was getting at, or how Andy was purporting to save him. But it apparently worked – and Andy became a favorite of the guards.

When the Sisters attack Andy again, leaving him in the hospital or some time, the guards retaliate against their ring leader. The ring leader is permanently unable to walk – and the attacks stop.

Andy returns from the hospital and is quickly moved off of laundry detail and into the library. He becomes a regular “H&R Block” as Red would say and offers tax advice to the guards and inmates. He also successfully expands the prison library by writing for grant and gift money (most libraries qualify as 501(c)(3) organizations and are, therefore, tax-exempt – which means big companies and the government will happily send them money).

The warden realizes that Andy has a talent. He retains Andy to help him hide money that he has been embezzling from a local prison program. Andy does this by laundering money through a made up identity: Peter Stevens (complete with falsified records). Clearly, embezzlement is a crime. It’s also a crime to assist in the embezzlement of funds. And the preparation of false tax returns to hide money is also a crime and subjects you to penalties and possible jail time (I guess if you’re already in jail, they just add time?).

But Andy continues to hide the money because it makes the warden happy – and it allows Andy to build up his library and award high school diplomas to inmates.

The Life-Changing Event

In 1965, a young prisoner named Tommy (played by Gil Bellows, from Ally McBeal) is convicted of theft and sent to Shawshank. Tommy tells a story about a cellmate who confessed to him that he killed Andy’s wife and lover. This story is Andy’s ticket to freedom.

The Twist

Without Andy, the warden would not be able to run his scheme. So, he tells Andy that he doesn’t believe Tommy – and later has Tommy killed. Andy is, understandably, despondent – and his friends fear that he may try to kill himself. Andy tries to quit working for the warden but the warden threatens not only Andy’s life but the fate of Andy’s beloved library.

The Sting

One morning, Andy isn’t around. His friends fear the worst.

But actually, it was the best. Andy had been tunneling through the wall in his cell for years with the rock hammer. He would carefully scoop up the debris and dump it in the yard as dust. Brilliant, really.

Andy goes to the bank to close out accounts… opened in the name of Peter Stevens. There are several hundred thousand dollars in the accounts.

Andy also sends a story about Shawshank – the treatment of inmates, the murders, the embezzlements – to the local paper. As a result, Hadley is arrested; the warden commits suicide.

Eventually, Red makes parole. He struggles to find his place in this new world and can’t seem to fit in. But then he remembers his conversation with Andy – and follows instructions steps to Mexico where the friends reunite. They appear to live in Mexico (tax-free) off of the spoils of the warden’s wrongs. It raises an interesting question: can a wrong be righted by someone with a higher motive? What do you think?

The Skinny

The movie was nominated for review by Kay. Remember that your comments will count as votes for Kay – and she can win some great prizes. So tell me what you think about the movie, the review, the locale… Should Andy be pardoned? Did he do the right thing? Is wrong always wrong?

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Kelly Phillips Erb is a tax attorney, tax writer, and podcaster.


  1. this movie rocks. even though we’ve seen in too many times we still watch it when it’s on TV. as a matter of fact, we did again, just last week. so yeah, this movie gets my vote 🙂

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