Hi There,

My client has over 1m in ISOs and was divorced in 2020. The Marital Settlement Agreement awarded 1/2 of the ISOs to his ex spouse. In the 1st quarter of 2021 she exercised and sold 570K. This amount is reported on my client's paystub and will appear on his W2 for 2021. There is a PLR that says the ex is responsible for reporting the income on her return. I am unclear about the logistics of this. How do you back out W2 income and assign it to another person? Does anyone have experience with this issue?

Thanks!