Form 3921 2022 Printable, Fillable PDF – If your workers exercised incentive stock options (ISOs) during the previous tax year, your organization is required to submit IRS Form 3921 to the IRS. Companies are required to submit a single form for each ISO exercise, and if they miss the deadline or disregard IRS warnings and fail to file, they might face steep penalties from the Internal Revenue Service.
Each Form 3921 is made up of three copies. Your company name is:
- Copy A is sent to the Internal Revenue Service, either online or by mail.
- Copy B is given to the employee who exercised his or her options.
- Copy C should be kept for your company’s records.
How To Complete And Submit Form 3921
Form 3921 may be filed either by mail or online, depending on your preference. In the event that you are obliged to submit 250 or more 3921s, you must do so electronically. Regardless of the route you choose, you’ll need a few supplies to get started:
- A list of the workers who used their ISOs in the preceding year is available.
- These employees’ tax identification numbers
- The transmitter control code for your organization (TCC)
- If you’re filing electronically, you’ll also need to create an account on the Internal Revenue Service’s Filing Information Returns Electronically (FIRE) website.
If this is your first time filing online and you’re not sure what to do, you’ll need to electronically file Form 4419 so that the IRS can assign you a TCC, which will allow you to set up a FIRE account. If this is your first time filing online and you’re not sure what to do, you can get help from the IRS. This might take many weeks.
If you opt to file by mail, you will not be able to simply print out the necessary paperwork and ship it in. The Internal Revenue Service demands that you print them on specific paper. The IRS processes the forms via the use of machines, and the machines can only read paper that has been provided by the IRS. On the IRS’s website, you may place an order for the unique paper.
If You Utilize Carta To Prepare Form 3921, Filing It Is A Simple Process
The following are the deadlines for filing:
- The deadline for providing copy B to all workers who participated in ISOs during the previous year is January 31st.
- The deadline to submit copy A to the Internal Revenue Service (IRS) on paper is February 28th.
- The deadline to electronically submit Copy A to the Internal Revenue Service is March 31st.
A filing deadline with the IRS that occurs on a legal holiday or on a weekend is automatically extended to the next working day.
Having Failed To File Form 3921
If you fail to provide the right information by the deadline, you will almost certainly be subject to a penalty. The amount of tax you owe is determined by when you submit the appropriate form. If you accurately file the following:
- You’ll be required to pay $50 for each form within 30 days of the due date (i.e., per employee who exercised an ISO).
- The maximum penalty is $547,000 per year, or $191,000 in the case of small firms (defined as any company having an average taxable income of $5 million or less over the previous three years).
- You’ll be charged $100 per form if you submit it more than 30 days after the due date but before August 1st.
- For small enterprises, the maximum penalty is $1,641,000 per year, or $547,000 in total.
- After August 1st, or if you fail to submit your forms properly, you’ll be charged $270 per form.
- For small enterprises, the maximum penalty is $3,282,500 each year, or $1,094,000 in total.
Penalties are only imposed if you fail to file or if there are significant mistakes in the paperwork you have filed. A fee would be levied if, for example, the payee’s tax ID number or surname is inaccurate and prevents the IRS from completing the return.
With Carta Form 3921 Is Automatically Created With A Single Click
When you upgrade to our Form 3921 product, Carta’s platform enables you to produce all of your 3921s in a matter of seconds.
When your cap table is hosted on Carta, the platform keeps track of when your workers exercise ISOs automatically. Every year, when tax season rolls along, the Carta system simply creates three copies of each form. It’s also possible to send copy B to staff with a single click while keeping copy C on Carta for your own records.
Everything you need to complete an online tax return with the IRS is in one convenient location. Download Form 3921 copy A and enter your TCC code in the Carta settings to complete the process. It’s then only a question of following the procedures on the IRS website from that point on.