I live in California, a former employer gave me 100,000 shares of common stock as a hiring bonus. When I left the company I was informed that my grant could not be excercised. although that fact was not spelled out in the stock plan.
The company later merged and the strike price was .35 cents per share.
This cost me $35,000.00 can I write this off to fraud as a bad debt ?
1 Answer from Attorneys
Unless you recognized income from the shares in the past, NO, there is deduction. If you did recognize income on the value of those shares given to you, then yes, you will have a deduction to the extent of the income you previously reported.