As a reminder, the Internal Revenue Code generally requires corporations to furnish an information return (Form 3921) to employees and to the IRS with respect to the transfer of stock pursuant to the exercise of (i) an incentive stock option under IRC §422 or (ii) an option under an employee stock purchase plan under IRC §423. (Note this does not apply to the exercise of non-qualified stock options.)
The return is required to be furnished to employees and filed with the IRS no later than January 31 of the year following the year of the transfer. Failure to file the return can result in a penalty of $50 per return, not to exceed $100,000.
Please contact Bruce Wynn or Jason Cordon at MMM if you have any questions.
