Who this affects
Employees and Investors
iOS & Android
Employees and Investors
iOS & Android
Employees registering their account on Carta for the first time can now provide their personal information as part of the onboarding process to complete their user profile.
Employees who have been issued ISO/NSO option grants or Restricted Stock Units and are registering with Carta for the first time.
With an objective to provide insightful experiences, we’ve revamped the employee onboarding process to allow users to complete their user profile. Every employee registering with Carta for the first time to accept their first RSU or ISO/NSO option grant will now have the ability to provide the following information:
Capturing these details upfront allows employees to be transaction ready for events such as exercising.
After successfully completing their user profile details, users will be directed to the Tasks page where they can accept their security.
Private companies can now report the complete list of all ISO dispositions and see exactly which dispositions qualify for tax incentives and which ones do not, along with Ordinary Income value and other information.
Under Capitalization > Reports, find the Disqualifying Disposition Report (ISO):
Select the reporting date range, acknowledge the report’s use of in-platform securities and transactions, and then export the report to Excel:
When the report finishes generating, it will be available in the Downloads menu:
The report shows info on Disposition Type, Ordinary Income, FMV and more. In order to be completely transparent, Excel formulas are used for Disposition Type, Ordinary income, First Qualifying Disposition Date, and Disqualifying Reason fields to show how they are calculated:
Private companies with tender offers or secondary ISO transactions captured in Carta.
Available now for all Private market customers (the Public market Disqualifying Disposition Report is available at request as part of the Early Access release).
For more information around the Disqualifying Disposition Report and underlying data, please refer to this support article.
Users with holdings in companies identified as Qualified Small Businesses (QSB) will now be notified of the potential tax benefit. Carta determines QSB eligibility when performing a 409A valuation and email notifications will be sent to all users associated with the company once the valuation is accepted. In addition, vesting emails will include information about the qualified small business stock (QSBS) tax benefit.
Furthermore, users can now find a banner in the company overview page within their portfolio that informs them about QSBS eligibility, linking to a blog post to learn more. Finally, users will be notified if their exercise qualifies for QSBS once they submit an exercise request.
US Companies using Carta for 409A valuations that are QSBS eligible and all their stakeholders, prioritizing “Vested” option holders.
Emails are sent to all users associated with a company that qualifies as a QSB. If Carta determines the company is a qualified small business, emails are sent once the 409A valuation is accepted. Extra emails are sent to all users each time the company’s valuation includes eligibility.
Vesting emails will now include information about QSBS eligibility to help make a more informed decision about exercising.
A banner informing users of the QSBS Eligibility Tax Benefit can be found next to the company’s name in their portfolio. This banner appears for companies identified as qualified small businesses, including information about the potential tax benefit from exercising and the expected timeframe of the company’s eligibility.
Upon submitting an exercise request, the Congratulations page will inform users that the shares are QSBS-eligible. It summarizes the conditions and links to an Equity Education article to learn more (highlighted in red).
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"
Users with holdings in private and public companies can now view their holdings details directly from the Portfolio screen for easy access.
Shareholders with holdings in private and public companies.
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:
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
New experience for exercise requests:
Action required: No action required
Timing: Released to 100% of all public companies on Jan 24, 2022
LPs subscribing to Funds and SPVs using Carta's Closings Tool can now E-Sign a pre-filled W-9 while filling out subscription documents.
Having LPs submit a tax form is an important part of the closings process for any Fund or SPV to ensure tax teams correctly prepare LP K-1s. We received feedback from LPs about the friction of printing, signing, and uploading W-9s and wanted to streamline the process.
For U.S. based LPs subscribing as an Individual, we can now optionally pre-fill a W-9 for them to review and E-sign in just three clicks. The W-9 is pre-filled based on the information the LP already provided as part of their subscription.
For Partnerships and LLCs
For LPs subscribing as a partnership or through a LLC we'll ask some additional questions to ensure we are accurately representing the LPs federal tax classification on the W9.
With the initial release of this product we will not be pre-filling W-8s or W-8BEN-Es for non-US LPs but will still allow them to upload their own form.
This is now available to any LPs using Carta's Closings Tool. The Closings Tool gives LPs a quick and easy way to fill out Fund and SPV subscription documents.
Private market issuers that go-live on or after 11/09/2021 can now track updates to company share classes’ rights and preferences as they are changed over time. This feature will roll out to other issuers in the next few weeks.
Users with the Legal administrator permissions will be able to make changes to the share class details. Users with the Company editor or Company viewer permissions will only be able to view the share class details.
To make edits to the share class details, click the Edit to the right of the AOI version date and name. If editing from the active AOI version, Admins will have the ability to reflect both a clerical error or amendment
Carta will check your entries for any errors and provide actionable messaging to help you make corrections.
Admins can navigate between AOI versions with the AOI version selector, which will show the filing date and version name as dropdown options.
Carta will be making improvements to tracking the company’s cap table, financing history, and reporting in the next few months to incorporate time-versioned share class information.
Have questions? Read about FAQs in our support article.
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:
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:
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
Private and public companies that issue option grants.
Available to all companies now.