Filed 83(b) election in June 2023 - Do I need to file additional forms for my tax return this year?

8 You're on the right track. After filing an 83(b) election, there's actually not much additional paperwork you need to submit with your annual tax return specifically related to the election itself. The Form 3921 is indeed what you should expect from your company for the options exercise. This form essentially reports your exercise of stock options to both you and the IRS. The company should provide this to you by January 31st. When you receive it, you'll use the information to report any taxable income from the exercise on your tax return. The beauty of the 83(b) election is that you've already paid tax on the spread (if any) between your exercise price and the fair market value at the time of exercise. So for your current tax return, there's no additional reporting specifically tied to the 83(b) election itself - you've already handled the most important part by filing the election within 30 days of exercise.

17 After dealing with a similar situation last year, I found taxr.ai super helpful for navigating my stock option paperwork. I was confused about how my 83(b) election affected my tax return, and my company sent me a Form 3921 that I wasn't sure how to interpret properly. I uploaded all my stock documents to https://taxr.ai and it explained exactly what I needed to report on my tax return. It analyzed my 3921 form and even checked that my 83(b) election was properly completed. The service explained which lines on my tax forms would be affected, which was way clearer than the generic advice I was finding online.

22 Just wanted to follow up about taxr.ai since I ended up trying it. I uploaded my documents including my 3921 forms and stock grant paperwork for both my ISO and NQSO options. The analysis was surprisingly detailed and actually explained the AMT implications I hadn't considered with my ISOs. The tool helped me understand exactly how to report everything correctly on my return and even flagged a potential issue with how my 83(b) election was documented that might have caused problems later. Definitely saved me from making some mistakes that would have been painful to fix later. Worth checking out if you're dealing with equity compensation on your taxes.

11 If you're having trouble getting answers from the IRS about your 83(b) election or Form 3921 questions, try Claimyr. I was freaking out last year because I couldn't get confirmation that my 83(b) was properly received, and I spent days trying to reach someone at the IRS with no luck. I found https://claimyr.com after searching for ways to actually speak to a human at the IRS. Their service basically gets you to the front of the IRS phone queue. I was skeptical but watched their demo at https://youtu.be/_kiP6q8DX5c and decided to try it. Got connected to an IRS agent in about 15 minutes instead of the 2+ hours I spent on previous attempts.

19 Hate to admit I was wrong, but I tried Claimyr after my skeptical comment. After struggling for weeks to get confirmation about my 83(b) election status, I got through to an IRS agent in about 20 minutes. The agent confirmed my election was properly recorded in their system and explained exactly how it would affect future stock sales. I was also confused about why I received multiple 3921 forms (turns out it was because I had multiple exercise dates), and they cleared that up too. Saved me so much stress knowing my paperwork was actually properly filed and I wouldn't have surprise tax bills later. Definitely beats the 3+ hour hold times I was experiencing trying to call directly.

24 One thing to remember about the 83(b) election is that it's a one-time filing, but you'll need to reference it when you eventually sell the shares. Make sure you're tracking your cost basis correctly from the date of exercise. When you sell, you'll report the sale on Schedule D and Form 8949, and the holding period starts from the date you exercised the options (not the date of the 83(b) election filing). The difference between your exercise price and the eventual sale price will be capital gain/loss.

5 Side question related to this: I filed 83(b) election for restricted stock (not options) last year. My stock is on a 4-year vesting schedule, but I'm thinking of leaving the company after only 2 years. What happens to the taxes I already paid on unvested shares if I forfeit them when I leave?

Great question! Yes, you're correct that your company should send you Form 3921 for the stock option exercise. Since you properly filed your 83(b) election within the 30-day window in June 2023, you've already handled the most important part. For your 2023 tax return, you'll need to report the ordinary income from the spread between your exercise price and the fair market value at the time of exercise (this should be reflected on the Form 3921). The good news is that by filing the 83(b) election, you've locked in the tax treatment - any future appreciation in the stock value won't be taxed as ordinary income when it vests. Make sure to keep copies of your 83(b) election filing and the certified mail receipt with your permanent tax records. You'll need this documentation if you're ever audited, especially when you eventually sell the shares. The 83(b) election affects your future cost basis calculation, so proper documentation is crucial. No additional forms are required specifically for the 83(b) election itself on your annual return - you just report the income from the option exercise using the information from Form 3921.