Form 982 Insolvency worksheet
I was given an upfront award attached to a promissory note that required me to stay with the company for 9 years in order to keep money,
What does this actually mean? Well let’s say the upfront award (loan) is $1,000,000 amortized over 10 years. In this case, the $1,000,000 is paid to you shortly after joining, the company attaches it to a promissory note, but the money is considered a loan for tax purposes. There was a bonus agreement where, as long as I remained within the firm, payments would be made on my behalf to pay down the loan. Amortizing the loan Annually over 10 years.
If I was given $1,000,000 upfront to join a firm over a 10 year term and left after 2 years I would have to repay the $800,000.00
I left after 2 years and was forced to file Chapter 7 bankruptcy after investment losses. I received a w-2 for the remaining balance of the promissory note (loan) after it was Canceled due to insolvency in Bankruptcy court. How do I use form 982 to offset the promissory note on my Taxes?
