RSU Tax Calculator 2026
RSUs are taxed like a bonus at vesting — and the default withholding often isn't enough.
When restricted stock units (RSUs) vest, their full market value is taxed as ordinary income that year, just like salary. Employers usually withhold at the flat 22% supplemental rate — but if you're in a higher bracket, that under-withholds and you owe the difference at filing. When you later sell the shares, any change from the vesting-day price is a capital gain or loss.
What changes for your taxes
- The full value of vested RSUs is added to your W-2 wages as ordinary income.
- Employers typically withhold a flat 22% — often too little if your marginal rate is 32–37%.
- You may owe a balance (and underpayment penalty) at filing unless you top up withholding or pay estimates.
- Selling the shares later triggers a separate capital gain or loss from the vesting-day value.
Why RSUs create a surprise tax bill
At vesting, your company reports the shares' market value as wages and usually sells or withholds enough shares to cover a flat 22% federal supplemental rate. If your actual marginal rate is 32%, 35%, or 37%, that 22% leaves a gap — and RSUs can be large, so the gap can be thousands of dollars you'll owe in April, sometimes with an underpayment penalty.
Fix it proactively: add extra withholding via Form W-4 Step 4(c), or make a quarterly estimated payment, to cover the difference between 22% and your real rate. Then track your cost basis at the vesting-day price — when you sell, you only owe capital-gains tax on the change since vesting, and selling right away means little or no additional gain.
| Your marginal rate | 22% withheld | Actual tax | You still owe |
|---|---|---|---|
| 22% | $11,000 | $11,000 | $0 |
| 24% | $11,000 | $12,000 | $1,000 |
| 32% | $11,000 | $16,000 | $5,000 |
| 35% | $11,000 | $17,500 | $6,500 |
| 37% | $11,000 | $18,500 | $7,500 |
Which situation is yours?
Your action checklist
Frequently asked questions
How are RSUs taxed?
As ordinary income equal to the shares' market value on the vesting date, reported on your W-2. Later, when you sell, any change from that vesting-day value is a capital gain or loss.
Why do I owe taxes on my RSUs?
Employers usually withhold only the flat 22% supplemental rate. If your marginal rate is higher, that under-withholds and you owe the difference at filing. Adding W-4 Step 4(c) withholding fixes it.
Should I sell RSUs as soon as they vest?
Selling at vest means little or no extra capital gain, since your basis equals the vesting-day price. Holding exposes you to your employer's stock risk. Many people sell to diversify and use the proceeds elsewhere.
Sources & verification
Last reviewed July 12, 2026.