What Is IRS Form 3922?
IRS Form 3922 is used to report the Transfer of Stock Acquired Through an Employee Stock Purchase Plan (ESPP) Under Section 423(c).
This form is filed when an employee exercises an option to purchase company stock at a discount through payroll deductions. While no income is recognized when exercising the option, employees must report any gain or loss when they later sell the stock.
How to Fill Out IRS Form 3922 (Box by Box)
The form includes 8 boxes, each providing specific details:
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Account Number
A unique identifier employers use to distinguish an employee’s record. Required for e-filers with 250+ records. -
Box 1: Grant Date
The date the option to purchase stock was granted to the employee. -
Box 2: Exercise Date
The date the employee exercised the option and purchased shares. -
Box 3: Fair Market Value (FMV) on Grant Date
The FMV per share when the option was originally granted. -
Box 4: Fair Market Value on Exercise Date
The FMV per share on the date the employee exercised the option. -
Box 5: Exercise Price Per Share
The price per share the employee paid to purchase the stock. -
Box 6: Number of Shares Transferred
The total number of shares legally transferred to the employee. -
Box 7: Transfer Date of Legal Title
The date legal ownership of the shares was officially transferred. -
Box 8: Exercise Price Determination
If the exercise price per share was not fixed/determinable on the grant date, Box 8 will show the exercise price. If it was determinable at grant, Box 8 remains blank.
Filing Deadlines
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Copy B (Employee): Must be provided by January 31.
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Copy A (IRS): Must be filed by February 28 (paper) or March 31 (e-file).
Employers should ensure accurate reporting, as this form helps employees track their cost basis for tax reporting when shares are sold.
Simplify Form 3922 Filing
Manually preparing IRS Form 3922 can be time-consuming. Instead, many companies rely on outsourcing services or IRS filing software to ensure accuracy. These solutions reduce errors, save time, and provide peace of mind.
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