Reminder: Information Statements Due by January 31, 2013, for 2012 Incentive Stock Options and Employee Stock Purchase Plan Transactions; IRS Filings Also Required


This is a reminder to public and private companies that grant incentive stock options (“ISOs”) or maintain a tax-advantaged employee stock purchase plan (“ESPP”). Under IRS regulations, these companies must provide information statements on Forms 3921 and 3922 no later than January 31, 2013, to any employee or former employee who exercised an ISO during 2012 or transferred shares of stock during 2012 that were previously acquired pursuant to an ESPP. Companies that fail to provide such statements on a timely basis may be liable for penalties of $50 per statement, up to a maximum of $100,000 per year.

In addition, companies must file returns with the Internal Revenue Service on Forms 3921 and 3922 no later than February 28, 2013 (if filed on paper) or April 1, 2013 (if filed electronically). Companies that are required to file 250 or more of either type of form must file the forms electronically. Companies that fail to timely file these information returns may be liable for penalties of up to $100 per information return, up to a maximum of $1,500,000 per year.

Please see full alert below for more information.

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