In 2010 My husband got a Value Appreciation Rights.
Employer reported as Gross Wages on his W2 line 1.
This was not a Stock Plan or 401K Plan. It was an employee Incentive Plan to stay on with the company.
My Husbands ex-wife took him back to court claiming that the Value Appreciation Rights were awarded to him during the years they were married, but were in a ten-year vesture.
In 2011 she took him back to Family Law
Court, but because she filed Bankruptcy
in 2010 her trustee came after both my husband and myself for those community property assets
to pay back her creditors.
She won a settlement.
Do we go back and amend our 2010 taxes
to reduce the amount of wages he received? Those were gross wages we reported.
Or do we write that off on our taxes this year?
The courts viewed it as a Non-Qualified Deferred Compensation
We are to pay those funds to her trustee.
How do we write this off on our taxes? Do we write it off to her or the Trustee?