RSU Tax Calculator (2026)

Two tax events, one grant

Restricted stock units look simple until vest day. You do not own stock until vesting; then the company delivers shares and the IRS treats the fair market value as wages. That W-2 income is taxed immediately—even if you never sell. When you later sell, you are only taxed on the change from vest-date value (capital gain or loss), not the full sale price again.

This calculator separates vest ordinary income, payroll tax on that income, estimated withholding, and capital gain on a hypothetical sale you enter. It helps you see whether supplemental withholding covers your bracket or whether you should adjust W-4 or make estimated payments before April.

2026 payroll and income tax context

Vest income stacks in ordinary 2026 brackets after other wages and deductions (Rev. Proc. 2025-32). FICA applies: 6.2% Social Security until cumulative wages hit $184,500, 1.45% Medicare on all covered wages, and 0.9% Additional Medicare Tax above $200,000 single / $250,000 joint on employee wages.

Withholding on vest often uses supplemental wage rules—commonly 22% federal flat on the supplemental portion—while your true marginal rate may be 32% or 35%. The bonus tax calculator illustrates similar withholding mechanics.

Withholding and sell-to-cover

Many employers sell a slice of vested shares to pay taxes (“sell-to-cover”). That sale is not a separate taxable event for you beyond the vest income already recognized—it is a withholding mechanism. If you hold remaining shares, your capital gain clock starts at vest. Holding more than one year after vest qualifies for long-term capital gains rates on appreciation after vest value.

How to use the calculator

Step 1 — Enter vest details

Shares vesting, FMV per share on vest date, and your other annual wages help position marginal rate. Include prior YTD wages if you are modeling a mid-year vest near the Social Security cap.

Step 2 — Model withholding

Enter employer federal withholding rate or flat supplemental assumption. Compare to projected liability with the paycheck calculator and W-4 withholding calculator.

Step 3 — Optional sale

Enter sale price and date to estimate short-term or long-term capital gain on post-vest appreciation. Basis equals vest FMV already taxed as wages.

Worked example (2026)

1,000 RSUs vest at $50 per share → $50,000 ordinary income. Employer withholds 22% federal ($11,000) plus FICA. If you sell all shares immediately at $50, capital gain is roughly zero because proceeds equal basis. If you hold and sell later at $65 after 18 months, long-term gain is about $15,000 ($15 per share), taxed at preferential capital rates—not another $65,000 of ordinary income.

83(b) elections do not apply to RSUs

Section 83(b) elections apply to restricted stock you already own subject to forfeiture—not typical RSU grants before vest. If you have restricted stock instead of RSUs, see the 83(b) election calculator.

AMT and NIIT

RSU vest income alone rarely triggers AMT for most filers, but large vests plus other preference items can. High vest years can push modified AGI over NIIT thresholds ($200,000 single / $250,000 joint). Model capital gain separately in the capital gains tax calculator.

State tax

States generally tax vest income as wages and sales as capital gains. Relocation around vest dates can create multi-state wage allocation—use the multi-state tax calculator with caution; resident credits are not modeled there.

Planning moves

• Increase W-4 Step 4(c) extra withholding before large vests if supplemental rates underwithhold
• Donate appreciated post-vest shares to charity when eligible instead of cash
• Coordinate 401(k) deferrals up to the 2026 $24,500 limit to reduce marginal ordinary income
• Harvest other losses in vest years via the tax loss harvesting calculator

Common mistakes

• Paying capital gains tax on the full sale price instead of only post-vest appreciation
• Assuming 22% withholding equals final tax on vest income
• Forgetting payroll tax on vest value in cash-flow planning
• Using grant-date value as basis instead of vest-date W-2 amount

Related tools

Compare NSO/ISO paths in the stock options calculator. Model ESPP discount taxation in the ESPP tax calculator. Close the year with the tax refund estimator.

Quarter-by-quarter vest planning

RSU schedules often cluster in February and August vest windows. Map each tranche separately: cumulative YTD wages affect whether Social Security withholding stops on the vest check, while Medicare continues all year. If two large tranches land in one calendar year, supplemental withholding on the second vest may still use flat methods even though your marginal bracket already peaked on the first—creating a refund story or balance due unrelated to “extra” money you thought was taxed correctly.

Employees considering Roth 401(k) deferrals should decide before vest: deferrals reduce W-2 wages but not RSU vest income unless your plan allows post-vest contributions from sell-to-cover cash. Coordinating vest proceeds with annual 401(k) limit ($24,500 in 2026) and HSA room ($4,400 self-only / $8,750 family) can shift ordinary income into pre-tax buckets when payroll still allows changes.

Documentation for cost basis on sale

Save every vest confirmation showing shares, FMV, and shares sold for taxes. Brokerage cost basis feeds often tie to vest FMV automatically, but manual transfers between brokers can drop basis to zero if not corrected—producing inflated capital gain on later sale. Form 1099-B may omit basis codes correctly on first sale after transfer; keep W-2 box 14 or employer stock plan statements as audit trail.

Divorce or estate transfers of vested shares carry over basis and holding period rules—community property states may split vest income differently from share ownership. Charitable donation of long-held post-vest shares can avoid capital gain if you itemize and meet AGI limits on appreciated property gifts.

Sources and methodology

Ordinary brackets and standard deductions use IRS Rev. Proc. 2025-32; Social Security wage base follows SSA 2026 ($184,500). Withholding assumptions are user-entered. Results are educational—not payroll or securities advice.