Form 3921, Exercise of an Incentive Stock Option Under Section 422(b)
Corporations file Form 3921 for each employee who exercises an incentive stock option, recording the grant date, exercise date, price, and share value. Fill in the official IRS PDF below and download it.
This is the genuine IRS PDF, unmodified. Source: IRS official page.
What is 3921?
Form 3921, Exercise of an Incentive Stock Option Under Section 422(b), is an information return a corporation files for each transfer of stock to a person who exercised an ISO. It reports the option grant date, exercise date, exercise price per share, fair market value on the exercise date, and the number of shares transferred.
The employee copy matters at tax time: exercising an ISO is not regular income, but the spread between exercise price and market value can trigger alternative minimum tax, and the numbers on this form are what the employee needs to figure AMT and, later, the basis when the shares are sold.
Who files 3921?
- Corporations whose employees exercised incentive stock options during the calendar year
- Transfer agents or payroll providers filing on a corporation’s behalf
- Startups whose employees early-exercised ISOs, one form per exercise transaction
- Not employees themselves: they receive Copy B and use it to prepare their return
How to fill out 3921
- Enter the corporation’s name, address, and TIN in the transferor boxes, and the employee’s details in the recipient boxes.
- Fill in box 1 with the option grant date and box 2 with the exercise date.
- Enter the exercise price per share in box 3 and the fair market value per share on the exercise date in box 4.
- Enter the number of shares transferred in box 5, and the corporation that transferred the stock in box 6 if it differs.
- Download the PDF, give Copy B to the employee by the deadline in the current instructions, and file Copy A with the IRS electronically or on official stock.
Quick fill 3921 on this page
Prefer to see the form itself while you type? Open 3921 in the editor to fill it on the actual pages, add a signature, and download.
Frequently asked questions
Does the employee owe tax when Form 3921 is issued?
Not ordinary income tax at exercise, but the spread reported on the form counts for alternative minimum tax. Employees should keep the form to compute AMT on Form 6251 and their cost basis when the shares are sold.
One form per employee or per exercise?
One form for each transfer of stock from an exercise. An employee who exercised on three dates in a year should receive three forms.
When is Form 3921 due?
Employee copies go out early in the year following the exercise, and the IRS copy follows on the information return schedule. Check the current General Instructions for Certain Information Returns for the exact dates.