[9][25] He was among the new officers Congress commissioned in response to the Chesapeake–Leopard affair, in which the crew of a British Royal Navy warship had boarded a United States Navy frigate, sparking calls for war.[26][27] Taylor spent much of 1809 in the dilapidated camps of New Orleans and nearby Terre aux Boeufs, in the Territory of Orleans. Under James Wilkinson's command, the soldiers at Terre aux Boeufs suffered greatly from disease and lack of supplies, and Taylor was given an extended leave, returning to Louisville to recover.[28]
Taylor was promoted to captain in November 1810. His army duties were limited at this time, and he attended to his personal finances. Over the next several years, he began to purchase a good deal of bank stock in Louisville.[29][30] He also bought a plantation in Louisville, as well as the Cypress Grove Plantation in Jefferson County, Mississippi Territory. These acquisitions included slaves, rising in number to more than 200.[31][32]
In July 1811 he was called to the Indiana Territory, where he assumed control of Fort Knox after the commandant fled. 