RSU Tax Calculator

By NumbersLab Editorial·Updated for 2026 tax year·Editorial standards

Calculate the tax impact of your RSU vesting event. See marginal federal, FICA, and state taxes on vested shares, plus capital gains if you sell.

Tax Year

Number of Shares Vesting

Vest Price Per Share

Other W-2 Income

Filing Status

State

Sale Price Per Share

Holding Period

Total Tax on RSU Event

$29,51939.4% marginal rate on RSU

Net value after taxes: $45,481

Marginal Federal

$17,949

23.9% of RSU income

FICA on RSU

$5,087

SS + Medicare

State Tax on RSU

$6,484

1-13.3%

Net Value

$45,481

After all taxes

Tax Breakdown

RSU Vest Income$75,000

500 shares × $150/share

Other W-2 Income$120,000

Combined W-2 Income$195,000

Marginal Federal Tax−$17,949

Marginal FICA−$5,087

Marginal California Tax−$6,484

Tax on Vesting$29,519

Total Tax$29,519

Net Value After Taxes$45,481

How This Works

Restricted Stock Units (RSUs) are taxed as ordinary income at the time they vest — not when they’re granted. The taxable amount equals the number of shares vesting multiplied by the fair market value per share on the vest date. This income is added to your W-2.

Because RSU income stacks on top of your regular salary, it’s taxed at your marginal rate — often higher than your average rate. This calculator shows the marginal (incremental) tax specifically on the RSU portion, not your blended rate on all income.

Most employers use “sell-to-cover” at vesting: they sell enough shares to cover the estimated tax withholding and deliver the remaining shares to you. The withholding rate (often 22% federal flat) may not match your actual marginal rate, so you may owe more (or get a refund) at tax time.

If you hold shares after vesting, your cost basis is the vest price. Any gain or loss from that point is a capital gain or loss. Shares held more than one year qualify for long-term capital gains rates (0%, 15%, or 20%), which are typically lower than ordinary income rates. This is different from ISOs, which have their own tax treatment.

Frequently Asked Questions

How are RSUs taxed?+

Restricted Stock Units are taxed as ordinary wage income at vest. The fair market value of shares on the vesting date is included in your W-2 wages and is subject to federal income tax, Social Security tax (up to wage base), Medicare tax (including Additional Medicare 0.9% above $200K), and state income tax. Most companies withhold shares to cover federal tax at the 22% supplemental rate, which is insufficient for employees in the 32%+ bracket — you'll owe more at tax time. Any subsequent appreciation from vest date is treated as capital gain (short or long-term) when you eventually sell.

Should I sell my RSUs immediately when they vest?+

From a pure tax standpoint, selling immediately is neutral — you've already paid ordinary income tax on the full vest value, so there's no additional tax on selling at the same price. From a portfolio standpoint, immediately selling and reinvesting elsewhere is usually optimal because it diversifies away from concentration in your employer's stock. The conventional advice: 'would I buy this stock with cash today?' If no, sell. Holding RSUs you wouldn't otherwise buy is the same as receiving cash and using all of it to buy that single stock — a position most people wouldn't take voluntarily.

Do RSUs count as income?+

Yes — RSU vests are W-2 wage income, fully taxable as ordinary income in the year of vest. They count toward your total compensation for purposes of: federal and state income tax, Social Security tax (up to the $184,500 wage base in 2026), Medicare tax including Additional Medicare 0.9% above $200K, retirement plan contribution limits as a percentage of comp, mortgage qualification (most lenders count vested RSUs as income), and child support / alimony calculations. Pre-vest, RSUs are essentially a promise of future income with no current tax.

What is the 22% RSU withholding rate?+

Most employers withhold federal tax on RSU vests at the IRS supplemental wage withholding rate of 22% (37% on amounts above $1 million per employee per year). This is a default withholding rate, not your actual tax rate. If your marginal federal rate is 24%, 32%, 35%, or 37%, the 22% withholding is insufficient — you'll owe more when you file. Many tech employees end up owing $20,000-$100,000+ at tax time because their RSU income pushed them into higher brackets without proportional withholding. Mitigation: make estimated tax payments quarterly, or update W-4 Step 4(c) to add extra withholding.

How can I reduce taxes on my RSUs?+

Strategies: (1) Maximize pre-tax 401(k), HSA, FSA — every dollar contributed reduces taxable income, including RSU income; (2) For ISO holders, exercise ISOs in years before large RSU vests (the AMT spread on ISOs is more painful in high-income years); (3) Make charitable contributions of appreciated RSUs you've held over 1 year — no capital gain recognized, full FMV deduction; (4) Time discretionary income (like Roth conversions) for low-RSU years; (5) Tax-loss harvesting in the same year to offset capital gains exposure. The hardest part is forecasting: RSU vests are large, lumpy, and need quarterly planning, not just April.