IRS instructions for completing Form 1099-MISC.
This ruling concludes that NQSOs and NQDC transferred by an employee to a former spouse incident to a divorce are subject to FICA, FUTA, and income tax withholding to the same extent as if retained by the employee. The ruling also provides reporting requirements applicable to the wage payments.
This ruling concludes that a taxpayer who transfers NQSOs and NQDC to a former spouse incident to divorce is not required to recognize income upon the transfer. Instead, the former spouse recognizes income when he/she exercises the stock options or when the deferred compensation is paid.