This Form 3921 2026 guide explains the IRS Exercise of an Incentive Stock Option Under Section 422(b). Form 3921 supplies exercise information for a covered incentive stock option transaction. The exercise event and a later sale are different events that may affect different tax calculations. The option, exercise and share-disposition records should remain linked so the taxpayer can determine the applicable basis and tax treatment.
Reviewed October 31, 2026. This is an independent guide. The version and availability information below identifies the IRS documents used for this page.
What Form 3921 2026 does and who prepares it
A corporation reports a covered transfer of stock following exercise of an incentive stock option.
For the connected reporting route, see Form 6251. Keep the role of that document separate from the task explained on this page.
| Official form | Form 3921 |
|---|---|
| IRS title | Exercise of an Incentive Stock Option Under Section 422(b) |
| Guide period | 2026 |
| Target version | Apr 2025 |
| Availability | Current IRS catalog PDF |
| Last checked | October 31, 2026 |
Get the Form 3921 2026 PDF and check its status
Use the IRS source to confirm the document before completing a real filing. The download link is a reference to the official file; it is not a statement that every copy inside the PDF may be printed and submitted. Follow any instructions about electronic filing, scannable copies, recipient copies or attachments.
Which version of Form 3921 2026 should you use?
The 2026 in the title identifies the tax year or calendar-year information addressed by this guide. For a 2026 income reporting document, the preparation or filing activity may occur in 2027. Do not change the income year simply because the calendar has changed. The exact filing or furnishing date comes from the instructions for this form and the filer circumstances.
Records to gather for Form 3921 2026
- Option grant and exercise records.
- Exercise price and fair market value information.
- Share sale records.
- Employment tax statements when relevant.
- Prior AMT information.
Keep a working reconciliation with these records. It should show the source of each reported item, any correction made before filing and the reason a different amount appears on a connected form. This is especially useful when a statement is corrected or a prior-year balance continues into the current calculation.
How to work through Form 3921 2026
- Identify the issuer and recipient. Check which person or entity prepares the information return and which person receives a statement. Use the correct copy and filing route for that role.
- Reconcile the underlying records. Compare the statement with the transaction, payroll, account or payment records. Resolve duplicate reporting and unexplained differences before carrying a total into a return.
- Read boxes and codes separately. Different boxes can describe different tax categories. A gross payment, a taxable amount, a withholding credit and an identifying code should not be combined as if they were one measure.
- Use the correct return treatment. An information return supplies facts. It does not independently establish every deduction, exclusion, credit or final tax result for the recipient.
- Address corrections at the source. Check the issuer correction process for an incorrect statement. If a related tax return has already been filed, review separately whether that return also needs a correction.
Form-specific IRS instructions and reporting details
The following points retain the operative wording of the IRS documents linked above. Read each point with its stated conditions and the applicable form version. References to another form or section describe a connected requirement; they do not mean that every reader must file every referenced document.
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.
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. You can get the General Instructions for Certain Information Returns at IRS.gov/Form1099GeneralInstructions.
E-filing returns. The Taxpayer First Act of 2019 authorized the reduce the 250-return e-file threshold. T.D. 9972, published February 23, 2023, lowered the e-file threshold to 10 (calculated by aggregating all information returns), effective for information returns required to be filed on or after January 1, 2024. Go to IRS.gov/InfoReturn for e-file options. Information Reporting Intake System (IRIS). The IRS has developed IRIS, an online portal for e-filing information returns. Go to IRS.gov/IRIS for more information.
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.
Additional reporting conditions
Continuous use revision. Use these instructions for tax year 2025 and subsequent years until a superseding revision is issued. Online fillable forms. To ease statement furnishing requirements, Copies B and C of Form 3921 and Copies A and B of Form 3922 have been made fillable online in a pdf format, available at IRS.gov/Form3921 and 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.
Calculations and supporting information
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, • 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.
Enter the name, address, and TIN of the person to whom the share or shares were transferred pursuant to the exercise of the option.
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.
Exceptions and related reporting
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.
Exercise of an Incentive Stock Option Under Section 422(b) Copy B For Employee This is important tax information and is being furnished to the IRS. If you are required to file a return, a negligence penalty or other sanction may be imposed on you if this item is required to be reported and the IRS determines that it has not been reported.
Further form details
You have received this form because your employer (or transfer agent) transferred your employer’s stock to you pursuant to your exercise of an incentive stock option (ISO). You must recognize (report) gain or loss on your tax return for the year in which you sell or otherwise dispose of the stock. Keep this form and use it to figure the gain or loss. For more information, see Pub. 525, Taxable and Nontaxable Income.
When you exercise an ISO, you may have to include in alternative minimum taxable income a portion of the fair market value (FMV) of the stock acquired through the exercise of the option. For more information, see Form 6251, Alternative Minimum Tax—Individuals, and its instructions. Employee’s taxpayer identification number (TIN). For your protection, this form may show only the last four digits of your social security number (SSN), individual taxpayer identification number (ITIN), or adoption taxpayer identification number (ATIN). However, the employer has reported your complete TIN to the IRS. Account number.
May show an account or other unique number your employer or transfer agent assigned to distinguish your account.
Reading the lines and boxes
These selected labels come from the linked target PDF. They are a reading aid, not a replacement for the full line instructions or a completed calculation. Match the label and document version before transferring any amount.
| Line or box | Label in the source form | What to check |
|---|---|---|
| 2 | Date option exercised | Use the date or tax period requested by this particular field. A payment date, acquisition date and return year can describe different facts. |
| 5 | No. of shares transferred | Check the applicable line instructions and keep the source workpaper with the return records. Transfer only the information that matches the field and reporting period. |
A practical example
An employee exercises an option and sells the shares in a later period. The taxpayer retains the exercise statement with the sale records and reviews the applicable tax and basis rules for both events.
This example illustrates the order of the review. It does not assume an unverified deduction, exemption, treaty rate or final tax amount. The applicable form instructions and the actual records determine the result.
Common mistakes to avoid with Form 3921 2026
- Do not assume exercise information is a broker sales statement.
- Review potential regular-tax and AMT differences.
- Retain the exercise record until any later share disposition is properly reported.
Questions about Form 3921 2026
Does receiving or downloading this form mean I must file it?
A corporation reports a covered transfer of stock following exercise of an incentive stock option. The form purpose and the applicable filing or furnishing conditions determine the action. Downloading a blank PDF does not itself create a filing obligation or establish eligibility for a tax benefit.
Is the revision date always the same as the tax year?
No. Some forms show a tax year, while continuing-use forms show a revision date and ask separately for the reporting period. Check the actual document and instructions. Do not relabel a payment or transaction solely because it was reported in a later calendar year.
What should I do if the underlying information is wrong?
Do not assume exercise information is a broker sales statement. Keep the original record and the correction trail. The issuer correction process, an amended return and an updated certificate can be different procedures. Choose the process that matches the document and the actual error.
Which records should I keep with the completed form?
Retain the source documents, applicable worksheets, submitted version and filing or furnishing confirmations. For this form, the working file should include option grant and exercise records, exercise price and fair market value information, share sale records. Keep continuing balances and prior-year support for as long as they remain relevant under the applicable recordkeeping rules.
Related forms and next steps
Use these guides when the connected issue applies to your records. Each page has its own purpose, reporting year and availability status.