Instructions (Forms 3921 and 3922)

Instructions for Forms 3921
and 3922

Department of the Treasury
Internal Revenue Service

(Rev. October 2017)

Exercise of an Incentive Stock Option Under Section 422(b) and Transfer of Stock
Acquired Through an Employee Stock Purchase Plan Under Section 423(c)
Section references are to the Internal Revenue Code unless
otherwise noted.

Future Developments

For the latest information about developments related to
Forms 3921 and 3922 and their instructions, such as
legislation enacted after they were published, go to IRS.gov/
Form3921 or IRS.gov/Form3922.

What’s New
On-line pdf fillable Copies B, C, and D of Form 3921. To
ease statement furnishing requirements, Copies B, C, and D
of Form 3921 have been made fillable on-line in a pdf format,
available at IRS.gov/Form3921.

Reminder

In addition to these specific instructions, you should also use
the current version of the General Instructions for Certain
Information Returns. Those general instructions include
information about the following topics.
Who must file (nominee/middleman).
When and where to file.
Electronic reporting requirements.
Corrected and void returns.
Statements to recipients.
Taxpayer identification numbers (TINs).
Backup withholding.
Penalties.
Other general topics.

A related corporation of the corporation,
Any agent of the corporation,
Any party distributing shares of stock or other payments in
connection with the plan (for example, a brokerage firm), and
Any party in control of the payment of remuneration for
employment to the employee.

Statements to Transferees

If you are required to file Form 3921, you must furnish a
statement to the person whose name is set forth on Form
3921. For more information, see part M in the current version
of the General Instructions for Certain Information Returns.
Truncating recipient’s TIN on payee statements.
Pursuant to Treasury Regulations section 301.6109-4, all
filers of this form may truncate a recipient’s TIN (social
security number (SSN), individual taxpayer identification
number (ITIN), adoption taxpayer identification number
(ATIN), or employer identification number (EIN) on payee
statements. Truncation is not allowed on any documents the
filer files with the IRS. A payer’s TIN may not be truncated on
any form. See part J in the current version of the General
Instructions for Certain Information Returns.

Employee's Name, Address, and TIN

Enter the name, address, and TIN of the person to whom the
share or shares were transferred pursuant to the exercise of
the option.

Account Number

Specific Instructions for Form 3921

The account number is required if you have multiple
accounts for a person for whom you are filing more than one
Form 3921. Additionally, the IRS encourages you to
designate an account number for all Forms 3921 that you file.
See part L in the current version of the General Instructions
for Certain Information Returns.

Who Must File

Box 1. Date Option Granted

You can get the General Instructions for Certain
Information Returns at IRS.gov/Form1099 or go to IRS.gov/
Form3921 or IRS.gov/Form3922.

Every corporation which in any calendar year transfers to any
person a share of stock pursuant to that person's exercise of
an incentive stock option described in section 422(b) must,
for that calendar year, file Form 3921 for each transfer made
during that year.

Exception. A Form 3921 is not required for the exercise of
an incentive stock option by an employee who is a
nonresident alien (as defined in section 7701(b)) and to
whom the corporation is not required to provide a Form W-2,
Wage and Tax Statement, for any calendar year within the
time period beginning with the first day of the calendar year in
which the option was granted to the employee and ending on
the last day of the calendar year in which the employee
exercised the option. For this purpose, the term “corporation”
is defined in section 7701(a) and includes, but is not limited
to:
The corporation issuing the stock,
Oct 03, 2017

Enter the date the option was granted.

Box 2. Date Option Exercised

Enter the date the option was exercised.

Box 3. Exercise Price Per Share

Enter the exercise price per share of stock.

Box 4. Fair Market Value Per Share on Exercise
Date
Enter the fair market value (FMV) per share of stock on the
date the option was exercised.

Box 5. Number of Shares Transferred

Enter the number of shares of stock transferred pursuant to
the exercise of the option.

Cat. No. 23069T

Box 6. If Other Than TRANSFEROR, Name,
Address, and TIN of Corporation Whose Stock
Is Being Transferred

Statements to Transferors

If you are required to file Form 3922, you must furnish a
statement to the transferor. For more information, see part M
in the current version of the General Instructions for Certain
Information Returns.

Enter the name, address, and TIN of the corporation whose
stock is being transferred pursuant to the exercise of the
option. Enter this information only if the corporation is not the
entity shown in the TRANSFEROR boxes in the upper left
corner of Form 3921.

Truncating recipient’s TIN on payee statements.
Pursuant to Treasury Regulations section 301.6109-4, all
filers of this form may truncate a recipient’s TIN (social
security number (SSN), individual taxpayer identification
number (ITIN), adoption taxpayer identification number
(ATIN), or employer identification number (EIN) on payee
statements. Truncation is not allowed on any documents the
filer files with the IRS. A payer’s TIN may not be truncated on
any form. See part J in the current version of the General
Instructions for Certain Information Returns.

Specific Instructions for Form 3922
Who Must File

Every corporation, which in any calendar year records, or has
by its agent recorded, a transfer of the legal title of a share of
stock acquired by the transferor (person who acquires the
shares pursuant to the exercise of the option) pursuant to the
transferor's exercise of an option granted under an employee
stock purchase plan and described in section 423(c) (where
the exercise price is less than 100% of the value of the stock
on the date of grant, or is not fixed or determinable on the
date of grant), must, for that calendar year, file Form 3922 for
each transfer made during that year.

Employee's Name, Address, and TIN

Enter the name, address, and TIN of the transferor.

Account Number

The account number is required if you have multiple
accounts for a transferor for whom you are filing more than
one Form 3922. Additionally, the IRS encourages you to
designate an account number for all Forms 3922 that you file.
See part L in the current version of the General Instructions
for Certain Information Returns.

A return is required by reason of a transfer described in
section 6039(a)(2) only for the first transfer of legal title of the
shares by the transferor, including the first transfer of legal
title to a recognized broker or financial institution. If a
contractual agreement exists or is entered into with a
recognized broker or financial institution pursuant to which
shares acquired upon exercise of the option will be
immediately deposited into a brokerage account established
on behalf of the transferor, then the deposit of shares by the
transferor into the brokerage account following the exercise
of the option is the first transfer of legal title of the shares
acquired by the transferor, and the corporation is only
required to file a return relating to that transfer of legal title.

Box 1. Date Option Granted

Enter the date the option was granted.

Box 2. Date Option Exercised

Enter the date the option was exercised.

Box 3. Fair Market Value Per Share on Grant
Date

Enter the fair market value (FMV) per share of stock on the
date the option was granted.

Shares of stock transferred as a result of the exercise of
an option described above must be identified in a manner
sufficient to enable the accurate reporting of the transfer of
legal title to such shares. This identification can be made by
assigning to the share certificates of stock issued pursuant to
such options a special serial number or color.

Box 4. Fair Market Value Per Share on Exercise
Date

The corporation whose stock is being transferred must file
Form 3922.

Box 5. Exercise Price Paid Per Share

Enter the FMV per share of stock on the date the option to
purchase the stock was exercised.
Enter the price paid per share on the date the option was
exercised.

Exception. A Form 3922 is not required for the first transfer
of legal title of a share of stock by an employee who is a
nonresident alien (as defined in section 7701(b)) and to
whom the corporation is not required to provide a Form W-2,
Wage and Tax Statement, for any calendar year within the
time period beginning with the first day of the calendar year in
which the option was granted to the employee and ending on
the last day of the calendar year in which the employee first
transferred legal title to shares acquired under the option. For
this purpose, the term “corporation” is defined in section
7701(a) and includes, but is not limited to:
The corporation issuing the stock,
A related corporation of the corporation,
Any agent of the corporation,
Any party distributing shares of stock or other payments in
connection with the plan (for example, a brokerage firm), and
Any party in control of the payment of remuneration for
employment to the employee.

Box 6. Number of Shares Transferred

Enter the number of shares to which legal title was
transferred.

Box 7. Date Legal Title Transferred

Enter the date legal title of the shares was first transferred.

Box 8. Exercise Price Per Share Determined as
if the Option Was Exercised on the Date Shown
in Box 1

If the exercise price per share was not fixed or determinable
on the date of grant entered in box 1, enter the exercise price
per share determined as if the option was exercised on the
date of grant entered in box 1. If the exercise price per share
is fixed or determinable on the date of grant entered in box 1,
then leave box 8 blank.
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Instrs for Forms 3921 and 3922 (Rev. Oct. 2017)