RSU Tax Calculator 2026
Estimate the federal, state, and FICA tax on your vesting RSUs — and the withholding gap between the flat 22% your employer withholds and what you actually owe.
Withholding gap
Disclaimer: Estimate only — this is not tax advice. It is simplified and ignores deductions, the standard deduction, AMT, bracket blending, the Additional Medicare 0.9% surtax, and NIIT. Your actual tax depends on your full return. Consult a tax professional before making decisions.
Why RSUs create a surprise tax bill
When RSUs vest, the full vest value is taxed as ordinary income — just like salary. But employers almost always withhold federal tax at the flat 22% supplemental rate. If your marginal rate is 32%, 35%, or 37%, that 22% withholding falls short, and the difference isn't collected during the year. Come April you owe the gap out of pocket, and if it's large enough you can also face an underpayment penalty. Many people don't notice until they file, which is exactly why it feels like a surprise.
How RSU tax is calculated
At vest, the value (shares × price on the vest date) is added to your ordinary income and taxed at your marginal federal rate, plus state income tax and FICA (Social Security 6.2% up to the wage cap, and Medicare 1.45%). Capital gains only enter the picture later: if you hold the shares after vesting, any gain or loss from the vest-date price is a capital gain or loss when you sell — the vest value itself is always ordinary income.
FAQ
How are RSUs taxed?
RSUs are taxed as ordinary income when they vest. The vest value (number of shares times the share price on the vest date) is added to your wages and taxed at your marginal federal rate, plus state income tax and FICA (Social Security and Medicare).
Why is only 22% withheld?
RSU income is treated as supplemental wages, and the default IRS flat withholding rate on supplemental wages up to $1 million is 22%. Your employer applies that flat rate regardless of your actual tax bracket, so high earners are typically under-withheld.
What is the withholding gap?
The withholding gap is the difference between what you actually owe (your real marginal rate plus state and FICA) and what your employer withheld (the flat 22% plus state and FICA). If your marginal rate is above 22%, the gap is positive and you'll owe it at filing. If it's below 22%, you over-withheld and get it back as a refund.
Do I pay tax again when I sell?
You only pay tax on the gain after vesting. Your cost basis is the vest-date value you already paid ordinary income tax on. If the shares rise before you sell, you pay capital gains tax on the increase; if they fall, you can claim a capital loss. Selling immediately at vest usually means little or no additional gain.
How can I cover the gap?
Common options: make quarterly estimated tax payments, use a sell-to-cover so extra shares are sold to raise cash for taxes, ask payroll to withhold at a higher supplemental rate if allowed, or adjust your W-4 to add extra withholding from your paycheck. Setting the cash aside when RSUs vest is the simplest safeguard.
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