Line by line Form 3922 Instructions
Updated on August 23, 2022 - 10:30 AM by Admin, TaxBandits
IRS Form 3922 is an informational form used by the corporations to report the transfer of stock acquired by the employee through the Employee Stock Purchase Plan under the section 432(c). This form is used only for information purposes, and information doesn't need to be included in employee tax return unless the employee has disposed of the stock option.
1. What is the Purpose of IRS Form 3922?
IRS Form 3922 is an informational form issued by companies to employees who have participated in the Employee Stock Purchase Plan. Generally, employees (shareholders) don’t have to include information on their tax returns unless they sell the stock option.
When the employee decides to sell or dispose of the stock option acquired through EPPS, the employee needs the information on Form 3922 to correct the basic cost information and determine the amount of ordinary income to be recognized.
2. Form 3922 Instructions - A complete breakdown
The Form 3922 has eight boxes. Each box requires specific information to complete the report. Here is the breakdown of the required information in each box.
1. Corporation’s details
- Corporations name
- Corporation address
- Corporation TIN
2. Employees Details
- Employee name
- Employee address
- Employee Identification number
3. Information Required In Box 1-8
- Box 1 - Data Option Granted: The date when the option to purchase the stock was granted to the employee.
- Box 2 - Date Option Exercised: The date on which the employee exercised the option under the ESPP (Employee Purchase Plan).
- Box 3 - Fair Market Value on Grant Date: The fair market value of shares per company stock on the date option was granted to the employee.
- Box 4 - Fair Market Value on Exercise Date: The fair market value of shares per stock of the company on the date the employee decided to exercise the option.
- Box 5 - Exercise Price: The price paid to the company stock on the date the employee exercised the option.
- Box 6 - Number of shares Transferred: The number of shares the employee purchased.
- Box 7 - Date Legal Title Transferred: The date when the legal title was transferred to the employee (Note: this date will always coincide with the date the employee exercises the stock option).
- Box 8 - Exercise price using Grant date Fair Market Value: If the exercise price was not fixed on the grant date , the box 8 shows the exercise price is determined as if the stock option was exercised on the date it was granted. The box will be left blank if the exercise price is determined.
3. When is the Deadline to File Form 3922?
Like other 1099 Forms, Form 3922 copies should be distributed to the IRS and employees who acquired the option through EPSS.
Due Date to file Form 3922 for the tax year 2022 is listed below
Recipient copies of Form 3922 should be distributed to the eligible employee on or before January 31, 2023.
|Recipient Copies||January 31, 2023|
|Paper Copies||February 28, 2023|
|E-filing Copies||March 31, 2023|
4. How to File 3922 Electronically with TaxBandits?
E-filing Form 3922 with TaxBandits provides numerous advantages. Our e-filing process is straightforward, and we provide real-time updates on the IRS status of your forms. Our built-in audit feature detects common mistakes on your forms that can result in IRS rejections.
- Step 1: Select Form 3922 from your Dashboard
- Step 2: Enter the Required Information to File Form 3922
- Step 3: Review the Form 3922
- Step 4: Transmit Form to the IRS
Get started with TaxBandits now to e-file your Forms 3922 in minutes and receive real-time updates on the filing status. With TaxBandits, you can file for as little as $0.80/Form.