Employee has worked for Employers incorporated business for several years at a salary of 80K per year. Another company is attempting to hire Employee, but Employer persuades Employee to agree to stay for at least 2 more years by giving Employee 2% of the company’s stock, which is worth $100K, and by giving Employees spouse a new car worth $30K. How much income does Employee realize from these transactions?

SWFT Individual Income Taxes
43rd Edition
ISBN:9780357391365
Author:YOUNG
Publisher:YOUNG
Chapter19: Deferred Compensation
Section: Chapter Questions
Problem 32P
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Employee has worked for Employers incorporated business for several years at a salary of 80K per year. Another company is attempting to hire Employee, but Employer persuades Employee to agree to stay for at least 2 more years by giving Employee 2% of the company’s stock, which is worth $100K, and by giving Employees spouse a new car worth $30K. How much income does Employee realize from these transactions?

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