Improvements to job leveling framework

We've enhanced the leveling framework with new and updated job areas and specializations. This improvement is an important step toward expanding the scope of the Bands feature to include benchmarks for these new job areas and specializations. 

NOTE: These updates do not impact your employee's target salary or equity, as they are simply improvements to the labeling system to more accurately reflect trends in job functions.

The following job areas and specializations have been added and updated. Job areas marked with an asterisk (*) are currently only available for leveling purposes and do not yet support bands. At this time, all specializations still do not differentiate bands/benchmarks from their top-level job area, however, we will soon be launching specialized bands starting with Engineering, IT, Marketing, and HR. You will be notified as soon as bands are available for these new areas and specializations.

Job AreaSpecialization
AdministrationAdministrative Assistant
Corporate Affairs*Government Affairs
Corporate Affairs*Regulatory Affairs
Customer SuccessTraining
DataBusiness Intelligence and Analytics
DesignIndustrial Design
DesignUX Design
EngineeringCrypto and Web3
EngineeringData Engineering
EngineeringWeb Engineer
FinanceFinancial Planning and Analysis
FinanceTax
HRBenefits
HRCompensation
HRDiversity
HRHR Generalist
HRLearning and Development
HRTotal Rewards
IT*Information Security
IT*Information Services
IT*Network Ops
LegalCorporate Counsel
LegalParalegal
Manufacturing*Assembly
Manufacturing*Manufacturing Engineering
Manufacturing*Production Planning
Manufacturing*Quality Assurance
MarketingCommunications/Public Relations
MarketingCreative Marketing
MarketingDigital Marketing
MarketingEvents
MarketingMarketing Operations
MarketingProduction
OperationsFacilities
ProductTechnical Writing
Project ManagementNon-Technical Project Management
Project ManagementTechnical Project Management
ResearchClinical Science
ResearchPre-Clinical Science
ResearchProcess Development
ResearchSupport
SalesSales/Solutions Engineering
StrategyBusiness Operations
StrategyCorporate/Business Development

New Updated User Roles

Soon, Carta customers will start seeing an expanded set of Roles to help you reflect the different individuals who are handling different aspects of Cap Table management.

For now, users assigned to new roles will serve as point of contact for their areas. Over time, these individuals will see updated experiences and be guided to relevant Carta tools.

To see this experience, Navigate to "Company > Permissions and Roles > Roles"

Portfolio Overview Redesign

Users with holdings in private and public companies can now view their holdings details directly from the Portfolio screen for easy access.

Who this affects?

Shareholders with holdings in private and public companies.

What’s new?

With an objective to provide insightful experiences, we’ve redesigned the Portfolio Overview screen to surface important holding details for each company. This redesign introduces usability enhancements by eliminating extra clicks and effort required to find the information needed to view and understand equity. 

We know things like the quantity of option grants, vesting schedule, and values of securities are some of the most important metrics to have top of my mind when reviewing your portfolio. In the Portfolio Overview, each private company card will now present the following information with the ability to view further details when clicked:

  • Details of your holdings in each company and their vesting schedule 
  • Summary of your securities
  • Current FMV if you have holdings in the company or have exercisable options 
  • A vesting progress bar highlighting the number of options exercised in comparison to the amount granted 

Each public company card will now present the following information with the ability to view further details by clicking on the company name:

  • Market Value
  • Total number of shares held
  • Total holdings value
  • Net holdings value

Carta Web now has Section 6039: Form 3922 tax form generation

What's new? 

Carta Web now supports the generation of Form 3922 for Employee Stock Purchase Plans in the Company Administrator view. Companies that would normally have access to the Compliance tab, can now request access to Section 6039 from their Customer Success Managers. Form 3922 forms are due to stakeholder portfolios by January 31, 2022. By enabling this functionality in Carta Web, administrators are now in control of the Form 3922 generation and distribution, similar to Form 3921 for Incentive Stock Option Exercises.

NOTE: This feature can be enabled upon request from companies that have an Employee Stock Purchase Plan.

From the IRS:

Corporations file this form (3922) for each transfer of the legal title of a share of stock acquired by the employee pursuant to the employee's exercise of an option granted under an employee stock purchase plan and described in section 423(c) (where the exercise price is less than 100% of the value of the stock on the date of grant, or is not fixed or determinable on the date of grant).

How to Use

  1. To generate Form 3922, navigate to Compliance > Section 6039.
    NOTE: TCC is not required to generate Form 3922 Copy B for employees.
     
  2. Click Generate.
     
  3. Select the Effective Year of the report.
     
  4. Review any missing information, check off the box to confirm company data, then click Next: add contact info. If any information is missing, complete the information, then return to this stage.
     
  • If Company tax data is not complete:

    1. Navigate to Company > Settings.
    2. Click into the Profile tab.
    3. Enter Tax ID, TCC (required to generate Copy A, but not required for Copy B) and address.

  • If Stakeholder tax details are not complete, update missing data under the Stakeholder details tab of the same Form 3922 page

    1. The names, addresses, and SSNs can be edited individually by clicking Edit to the right of the stakeholder’s row.
    2. The stakeholder details can also be updated in bulk via Stakeholders > All stakeholders page. Review these instructions to bulk update stakeholder details.

 

5. If the missing data was entered in, return to the Compliance > Section 6039 page and click Generate to click through the steps to proceed and add company contact information. The company contact is formatted into the electronic Copy A .txt file that will be uploaded to the IRS site.


Click Generate Form 3922 to begin the generation of the files.

 

6. Refresh the page after some time if you see a spinning wheel or navigate away and return later.

 

7. Once generated, click Download reports for the tax year to download a .zip file to your local drive that contains all necessary data for Copy A (efile), and Copy B (statements).

 

The .zip file will be split out into the following three files:

  • efile will be a specially formatted electronic .txt file.
    NOTE: Do not edit this file. Only download and upload to the IRS FIRE site. If any data needs to be updated, repeat the initial steps for the same filing tax year to regenerate the reports and download the updated files.
     
  • statements should be delivered to all holders who acquired stock through an ESPP by the January 31st deadline and can be delivered electronically on Carta by clicking the link to Deliver participant statements

 

For any filing questions, contact your tax advisor. 


Who this affects

Public and Private Market companies with an ESPP. 

Timing

This feature can be enabled on demand by reaching out to our support team or Customer Success Managers.

What's Next

The product team will be enhancing Form 3921 functionality to bring it more in line with the new Section 6039 admin experience.   

Improved Public Exercising Experience

Option exercising with Public companies is now easier than ever. 

The exercising experience for public companies has been improved. The exercise request is now a coherent workflow guiding users through each step and providing key information about the exercise. With this detail, users can be more confident with their selection at each step of the exercise request. If there are issues with the exercise, clearer banners explain how Carta calculates share amounts and market prices.


Who this affects: 🇺🇸 Public US companies

What's new:

  • New experience for exercise requests:

    • Added explanations of exercise transaction methods
    • Clearer confirmation of address and payout method
    • Improved order details with indicators on maximum eligible options and clear explanation of order types
    • Incorporated review of taxes withheld and reminder of potential for additional taxes owed at end of the year
    • Summarized the exercise request clearly laying out the cost and transaction details so users understand what will be needed 
  • Cashless exercising reflects issuer imposed trade limits

Action required: No action required

Timing: Released to 100% of all public companies on Jan 24, 2022

1099B Cost Basis Report available to Company Admins

What’s new?

We are releasing a report to all Private Market companies for administrators to review their certificate cost basis and original acquisition dates. This report will allow administrators to view cost basis data prior to the delivery of 1099B tax statements to stakeholders by mid-February.

How it works

This in-app report is available by navigating from Capitalization -> Reporting -> Form 1099b cost basis report.

Administrators will be able to view columns like stakeholder details, certificate ID's, quantity of shares sold, date acquired (original acquisition date), proceeds, gain/loss, and including various cost basis fields: 

  • cost_basis_total_certificate = full value going back to the original certificate
  • cost_basis_per_share = cost basis of total certificate / total shares quantity
  • cost_basis_sold_certificate = cost basis per share X sold shares quantity

From this report, Issuers can identify which certificates need to be changed and/or excluded from tax filing, and will have the opportunity to correct the data until late-January.

Who does this impact?

This report will be available to individuals with role permissions of Company Admin, and including Company Editors.

What’s next?

In the next month, Carta's Liquidity team will be reaching out to ensure that data has been reviewed and is considered approved by Issuers for generating 1099B statements. Stakeholders will be able to access tax statements in their portfolios by mid-February.

Adjust taxes for option exercises

What’s new

Companies can now adjust taxes for option exercises previously approved in Carta.

Legal administrators can navigate to the Exercises ledger (Transactions > Exercises) and select "Adjust taxes" within a ledger row dropdown to find the new tool:


How it works

The "Adjust taxes" tool will not be available for option exercises in the "Requested" status since option exercise approvers can adjust taxes as part of the exercise approval workflow.

For ACH option exercises already approved by the company or for company-entered manual exercises, the "Adjust taxes" tool will be available for use.

After a legal administrator selects "Adjust taxes" from the Exercises ledger, they'll see the following modal:

The legal administrator will be asked to provide a reason for the adjustment. Next, the following actions are available:

  • Un-check a box next to a tax type to remove it from the option exercise
  • Re-check a box to re-add a previously removed tax type to the option exercise
  • Update the specific tax withholding amount in the "Adjusted" column
  • Select "Add another tax type" to add a new tax type to the option exercise

Note that new tax types can't be added from this modal. If you'd like to add a new tax type to the exercise, add it first in the Tax rules page (Compliance > Tax rules) and then come back to the "Adjust taxes" tool to add it to the option exercise.

Once the adjustment has been saved, both the company and the stakeholder will see a blue banner when viewing the option grant. The banner contains information about the newly adjusted tax amount and exercise cost in addition to when the adjustment was entered in Carta:

Adjusted tax amounts will also be reflected in the "Exercised and settled report" and the "Tax withholding report" (Capitalization > Reporting).

For more information, check out the support article for the new "Adjust taxes" tool: https://support.carta.com/s/article/adjust-taxes-option-exercises

Who this affects

Private and public companies that issue option grants.

Timing

Available to all companies now.

Qualified Small Business Stock (QSBS)

What’s new

Companies using Carta for 409A will now be additionally assessed for qualified small business eligibility at no extra cost to the company.

Certificates issued by a qualified small business as determined by Carta will have a "QSBS" tag in the product to indicate that the shares represent Qualified Small Business Stock (QSBS). The goal of these tags is help stakeholders make more informed selling decisions.

The IRC’s definition of a qualified small business is restrictive yet vague and open for interpretation at the edges, so potential holders of QSBS should consult their tax advisor before making decisions to sell and claiming the QSBS tax benefit.

How it works

Based on company-provided information during the valuations process, Carta will assess the following criteria for qualified small business eligibility:

  • Company's gross assets are $50M USD or less
  • Company is an active business
  • Company is a C-corp
  • Company does not operate in excluded industries

If a company is identified as a qualified small business, a new badge will appear in the 409A dashboard:

If a stakeholder receives a certificate from a qualified small business but hasn't yet met the 5 year holding period for QSBS, they'll see a "QSBS eligible" tag in their portfolio:

Drilling into the security, the stakeholder will see some additional information about the QSBS status of the certificate:

Stakeholders who have held shares issued by a qualified small business for 5 years will see a "QSBS" tag in their portfolio instead:

Additional Resources

For detailed information about QSBS in Carta, please refer to our QSBS support article.

Who this affects

Companies using Carta for 409A and their stakeholders.

Timing

  • Available now to 50 randomly selected 409A customers
  • General availability for all 409A customers coming in two weeks

View Public Company Holdings on Mobile

Users with holdings in public companies will now have the ability to view their holdings for both public and private companies straight from the Carta iOS app. Shareholders can now track market values, view total holdings value and more.

Who this affects

Shareholders with holdings in public companies.

Supported platforms

  • iOS (Android coming soon)

What's new

With an aim to provide functional and streamlined experiences for shareholders, we’ve brought the ability to view public holdings on the Carta iOS app. Public company cards will now be present among private companies on the home screen. The following information will be displayed for each public company card with the ability to view further details when clicked:

  • Total number of shares held
  • Total holdings value
  • Net holdings value

New Shareholder Experience Page

We are making it easier for companies to keep employees, investors, and other stakeholders informed about their holdings and company changes. 

Companies have historically been able to grant viewing permissions to their stakeholders via our Cap Table Sharing page and features. This experience, however, was burdensome for many company administrators who found themselves having to change sharing settings as new stakeholders were added to their cap table or existing stakeholders changed their relationship to the company, such as an employee leaving the company or an investor exiting their position.

With our new Shareholder Experience page, company administrators can designate what type of information they want to share with their different stakeholders and set rules based on these preferences. By setting permissions by rules instead of a stakeholder-by-stakeholder process, we make it easier for company administrators to get the right stakeholders the appropriate information and reflect their information sharing philosophy.

Companies can choose to enable a specific shareholder experience based on the relationship of the stakeholder to the company. For example, companies can choose what information founders, investors, employees, and former employees, and other stakeholders access on Carta. We’ve renamed, updated, and simplified our access levels to Restricted, Basic, Advanced, and Full Details. We include a “Recommended” level for different relationships (e.g. Investors = Advanced) to help guide founders and other company administrators on setting up their Shareholder Experience based on user feedback. 

We’ve also added a new rule where former stakeholders--those who no longer have an active investment or holding in the company--will automatically be downgraded to Restricted automatically. This means that as stakeholders enter and exit the cap table, their respective shareholder experience will update automatically.

New Shareholder Experience page: Group levels

We know that sometimes it’s important for company administrators to create experiences specific to a single stakeholder or user. The new Shareholder Experience feature allows companies to set overrides for specific stakeholders in the “Individual levels” tab. We also provide information on that stakeholder’s relationship and holdings information.

New Shareholder Experience page: Individual levels



To help ensure company administrators set access levels that best fit the needs of their stakeholders, our access level guide is clickable from either the Group Level or Individual Level views of the new Shareholder Experience.

Access level guide

We appreciate our users’ feedback on how to make this page clearer and easier to use. We hope these improvements save company administrators valuable time and help them mirror their company information sharing philosophy in our software.

Who is this available for?

The cap table sharing page is available currently via a limited release to select Carta companies. In the coming weeks, we will begin to allow additional companies to migrate to the new Shareholder Experience feature set. This new product is not limited by subscription tier.

Companies with the new Shareholder Experience features enabled can visit Stakeholders > Shareholder Experience. 

If you’d like to enable the new Shareholder Experience page for your company, you can also contact us.

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