Tax documents on Carta: Form 3921 and 83(b) elections

Employees can find equity-related tax forms in their Carta account under Tax Documents, typically during tax season.

Form 3921

What it is: Issued to employees who exercise incentive stock options (ISOs). It reports the exercise price, the fair market value at exercise, and the exercise date to the IRS.

Why it matters: The IRS uses this form to assess potential tax implications, particularly for Alternative Minimum Tax (AMT). Employees should share it with their tax advisor.

How it works: Once your company generates and delivers Form 3921s in Carta, employees receive an email directing them to download or print the form. All generated forms are stored in their personal portfolio under Tax Documents.

83(b) Election

What it is: A tax election available for early-exercisable grants and restricted stock awards (RSAs). It lets employees choose to pay taxes on the stock's value at the time of the grant, before it vests.

Why it matters: If the stock increases in value over time, making the 83(b) election can lock in lower taxes on future gains. It must be filed with the IRS within 30 days of exercise (for early-exercisable grants) or within 30 days of the grant date (for RSAs).

How it works: Carta automatically recognizes when a grant is eligible for an 83(b) election. Employees can generate the form during the exercise request process, then print and mail it to the IRS themselves.

Employees can contact Carta Support for help accessing or downloading their tax documents.