Find out whether the tax withheld on your RSU vest is enough. Employers usually withhold federal tax at the flat 22% supplemental rate, but if your income puts you in the 24%, 32% or higher bracket you will owe more at tax time. Enter your vest and income to see the shortfall, shares withheld and net shares.
Last updated:
This vest
shares
$
Supplemental wages over $1M a year are always withheld at 37%; some employers let you elect 37%.
Your tax picture for the year
$
Salary, bonus and other taxable income, excluding RSUs.
$
Supplemental wages already paid; counts toward the $1M 37% threshold.
$
%
0 for states with no income tax.
%
Many states use a flat supplemental rate.
Enter your values to see the result.
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How to use the RSU Tax Calculator
Enter the RSUs vesting and the share price on the vest date.
Choose how withholding is paid (shares withheld or cash) and the federal withholding rate.
Add your other income for the year, earlier vests or bonuses, filing status and deduction.
Enter your state rate and the state's withholding rate on supplemental wages.
Read the shortfall and plan an estimated payment or a W-4 adjustment to cover it.
How the RSU tax shortfall is calculated
RSU income = shares vesting × fair market value at vest.
Federal withholding = RSU income × 22% (or 37% if elected), with any part above $1 million of supplemental wages for the year at 37%.
Federal tax owed = tax on (other income + RSU income − deduction) − tax on (other income − deduction), using the 2025 or 2026 brackets for your filing status.
Shares withheld = total withholding ÷ share price, rounded up to a whole share.
Example: 400 shares at $180 = $72,000 for a single filer with $170,000 of other income in 2026. Withholding at 22% is $15,840. Taxable income rises from $153,900 to $225,900, so the RSU income is taxed at 24% and 32%: federal tax owed is $19,210, a federal shortfall of $3,370.
Federal withholding vs. bracket rates (2026)
Bracket
Single taxable income
Married jointly
Shortfall per $10,000 of RSUs at 22% withholding
22%
$50,400 – $105,700
$100,800 – $211,400
$0
24%
$105,700 – $201,775
$211,400 – $403,550
$200
32%
$201,775 – $256,225
$403,550 – $512,450
$1,000
35%
$256,225 – $640,600
$512,450 – $768,700
$1,300
37%
over $640,600
over $768,700
$1,500
Brackets: IRS Rev. Proc. 2025-32 for tax year 2026. Social Security wage base: $184,500 (2026), $176,100 (2025). Edit the tax year above to switch.
Set cash aside on vest day for the shortfall, especially if you plan to hold the shares.
Use the safe harbor: paying at least 100% of last year's tax (110% if AGI was over $150,000) through withholding and estimates generally avoids the underpayment penalty.
Track cost basis: the vest-date value is your basis. Brokers sometimes report $0 basis on Form 1099-B for RSUs.
Frequently asked questions
How are RSUs taxed?
When RSUs vest, the fair market value of the shares is ordinary wage income, reported on your W-2 and subject to federal and state income tax, Social Security and Medicare. That value becomes your cost basis; any later rise or fall is a capital gain or loss when you sell.
Why is 22% withheld on my RSUs?
RSU income is a supplemental wage, and US employers may withhold federal income tax at a flat 22% on supplemental wages up to $1 million a year. Above $1 million the rate is a mandatory 37%. Withholding is only a prepayment; your real tax depends on your bracket.
Why do I owe tax on RSUs at tax time?
If your total taxable income puts the RSU income in the 24%, 32%, 35% or 37% bracket, the 22% withheld is too little. For example, $72,000 of RSU income taxed at 24% to 32% can leave a shortfall of several thousand dollars.
How many shares are withheld for taxes?
With sell-to-cover or net share settlement, the employer withholds enough shares to cover federal, state, Social Security and Medicare withholding, usually rounding up to a whole share and refunding the excess through payroll. Total withholding of roughly 30% to 45% of the shares is common.
How can I avoid an RSU tax shortfall?
Options include asking your employer whether you can elect a higher withholding rate, increasing withholding on your regular paycheck with a new W-4, or making quarterly estimated tax payments. Paying enough during the year also helps you avoid an underpayment penalty.
Are RSUs taxed twice?
No. The vest value is taxed once as income. If you sell later, only the change from the vest-date value is taxed as a capital gain (or deducted as a loss). Make sure your broker's cost basis includes the vest value, or you may pay tax on it again by mistake.
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