Afternoon. I am new to the forum. I found this place last week and have an unusual situation with a client.
Client was a high-level executive with a company. He was given stock in the company in November or December, 2012 and this amount was included on his W-2 (grossed up to include payroll taxes). Well this company has since had its records seized by the FBI, the State has assigned its customers to other businesses, and all employees have been terminated except for a skeleton crew to wrap things up.
So my client was issued stock in a worthless company, had the value included as wages and had fed W/H paid in on his behalf. He now wants to contest this addition to his W-2, saying that the executives knew the company was worthless when the stock was given to him. I can't find anything to substantiate what he wants to do. Any thoughts?
Thanks in advance,
Marco
EDIT: Found out from client it was restricted stock that became vested in December, 2012. Still having a problem wrapping my head around how a stock can be worth $150,000 in December and totally worthless 2 months later.
Client was a high-level executive with a company. He was given stock in the company in November or December, 2012 and this amount was included on his W-2 (grossed up to include payroll taxes). Well this company has since had its records seized by the FBI, the State has assigned its customers to other businesses, and all employees have been terminated except for a skeleton crew to wrap things up.
So my client was issued stock in a worthless company, had the value included as wages and had fed W/H paid in on his behalf. He now wants to contest this addition to his W-2, saying that the executives knew the company was worthless when the stock was given to him. I can't find anything to substantiate what he wants to do. Any thoughts?
Thanks in advance,
Marco
EDIT: Found out from client it was restricted stock that became vested in December, 2012. Still having a problem wrapping my head around how a stock can be worth $150,000 in December and totally worthless 2 months later.
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