@Attie , you are correct. Had she listened a little more closely to her attorney (well maybe), or consulted you in advance, she would have known to follow the steps you are telling her. I have been a practicing CPA for about 40 years, and I have never seen a victory for the recipient spouse because "she thought it was non-taxable if paid directly to her". If she keeps insisting she is correct, then hand her documents, and softly insist she try another tax preparer.
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