Estimate the tax owed on a vesting RSU grant. The calculator models the standard 22% supplemental withholding (or 37% if you’re over $1M YTD), FICA, state tax at your marginal rate, and the true-up at filing.
Net take-home (after all withholdings)
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Estimated true-up at filing
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Federal supplemental withholding
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FICA total
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State withholding
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Total withholding
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Why 22 percent withholding leaves a gap
When restricted stock units vest, the full market value lands on your W-2 as ordinary wages, and your employer withholds federal tax at the flat supplemental rate the IRS sets for bonuses and similar pay: 22 percent on supplemental wages up to $1 million in a year, then 37 percent above that. The problem for most people who receive meaningful RSU grants is that 22 percent is well below their actual marginal bracket. A senior engineer already in the 32 or 35 percent bracket sees only 22 percent withheld, and the shortfall, the true-up, comes due at filing. This calculator models the withholding your employer actually takes, then compares it to the federal tax you really owe so you can see the gap before it surprises you in April.
500 shares at $200 on a $200,000 salary
Run the defaults: 500 shares vesting at $200, a $200,000 salary already earned this year, single filer, 22 percent supplemental withholding, and a 9.3 percent California rate. The vest is worth $100,000. Here is every piece of withholding and the true-up.
| Component | Amount |
|---|---|
| Gross vest value (500 x $200) | $100,000 |
| Federal supplemental withholding at 22% | $22,000 |
| Social Security (wage base already exceeded) | $0 |
| Medicare 1.45% on $100,000 | $1,450 |
| Additional Medicare 0.9% on amount over $200,000 | $900 |
| California withholding at 9.3% | $9,300 |
| Net take-home this vest | $66,350 |
Notice the Social Security line is zero. That is correct, not a bug: the $200,000 salary already blew past the $176,100 Social Security wage base for 2026, so no further Social Security tax applies to the RSU. Medicare has no cap, so 1.45 percent hits the full $100,000, and the Additional Medicare 0.9 percent applies to the slice of total income above the $200,000 single threshold, here the whole $100,000 vest. The real sting is federal: your actual federal tax on this vest is about $33,484 because it stacks on top of $200,000, where the first dollars are taxed at 32 percent and the top dollars reach 35 percent, but only $22,000 was withheld. The chart shows that true-up gap.
The cost-basis trap on your 1099-B
This is the single most expensive RSU mistake I see, and it has nothing to do with vesting. When you eventually sell the shares, your broker issues a Form 1099-B reporting the sale. Many brokers report a cost basis of $0, or leave it blank, because they only know what you paid out of pocket, which was nothing. But your real basis is the fair market value at vesting, the $100,000 you already paid ordinary income tax on. If you accept the broker's $0 basis, you pay capital gains tax a second time on income you were already taxed on at vest. The fix is to report the correct basis on Form 8949 with an adjustment code and let it flow to Schedule D. On a same-day sale this can mean the difference between owing nothing and overpaying tens of thousands. Always check the basis on every RSU sale.
Why the gap also risks an underpayment penalty
The true-up is not just a cash-flow surprise. The IRS expects you to pay tax roughly as you earn it through the year, and if a large under-withheld vest leaves your total payments short, you can owe an underpayment penalty on top of the tax itself. The safe-harbor rules are the escape hatch: you generally avoid the penalty if your withholding plus estimates covers either 90 percent of this year's tax or 100 percent of last year's (110 percent if your prior-year adjusted gross income topped $150,000). A flat 22 percent on a six-figure vest can quietly knock you out of that safe harbor, which is the real reason the gap deserves attention well before April rather than a scramble at filing. Withholding counts as paid evenly across the year regardless of when it happens, which is why bumping your W-4 late in the year can patch a shortfall that quarterly estimates alone cannot fully cure.
Are RSUs taxed when granted or when they vest?
At vesting, in almost all cases. A standard RSU has no value you can access at grant, so there is nothing to tax until the units vest and convert to shares you own. At that moment the full market value is ordinary income. This differs from restricted stock awards, where an 83(b) election can let you elect taxation at grant; that election is generally not available for ordinary RSUs.
What happens to my unvested RSUs if I leave the company?
You forfeit them, in the typical plan. Unvested RSUs are a retention tool, so quitting or being laid off usually means the unvested portion simply disappears, with no tax owed because nothing ever vested. Only the units that had already vested are yours to keep as shares. This is worth modeling before you resign or accept a competing offer: a signing grant from a new employer often has to be large enough to replace the unvested equity you walk away from, and the vesting cliff on the new grant can leave a gap. Read your plan's treatment of accelerated vesting on a change of control too, since an acquisition can change the answer entirely.