Equity compensation · 2026 federal estimate
RSU Tax Calculator
See the two tax events separately: ordinary wage income when RSUs vest, then capital gain or loss when the resulting shares are sold. Compare share withholding with estimated federal tax.
Quick estimate
Estimate RSU tax at vest and sale
Ordinary income recognized at vest
$50,000780 shares remain after entered share withholdingEstimated federal tax is $9,039 above the federal allocation.
See withholding and payroll taxes
- Total value of shares withheld
- $11,000.00
- Social Security
- $3,100.00
- Medicare
- $725.00
- Additional Medicare
- $0.00
- State withholding estimate
- $4,650.00
- Remainder allocated to federal income tax
- $2,525.00
- Modeled sale proceeds
- $30,000.00
This model assumes vest-date fair market value becomes wage income and basis. Selected-state tax is an incremental liability estimate, not an employer withholding table. Multi-state sourcing, local tax, every lot, wash sales, and state basis differences are excluded.
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How this calculator works
A restricted stock unit is generally a promise to deliver stock or cash after vesting conditions are met. For a typical public-company RSU settled in shares, the fair market value delivered at vest is compensation reported as wages. That value generally becomes the tax basis of the shares.
Share withholding is a payment method
Employers often retain or sell shares to cover several taxes at once. The calculator values withheld shares at the vest price, allocates selected-state incremental tax and calculated payroll taxes first, then treats the remainder as federal income-tax withholding. It compares that federal allocation with incremental 2026 ordinary income tax based on the other annual wages and filing status entered. Your pay statement should replace this allocation when available.
Payroll taxes can change near wage thresholds
RSU wage income can be subject to Social Security up to the 2026 $184,500 wage base, regular Medicare without a wage ceiling, and Additional Medicare withholding after an employer pays more than $200,000 during the year. Final Additional Medicare Tax liability uses filing-status thresholds and the whole return; the payroll estimate here uses entered year-to-date wages.
Do not pay tax twice on the same value
Broker tax reporting may show gross proceeds while basis information may be missing or require adjustment. If vest-date compensation already appeared in wages, using zero basis would incorrectly turn the entire sale proceeds into capital gain. Keep vest confirmations, pay statements, Form W-2, and broker records by lot.
The sale uses the 2026 capital-gain bands
Choose whether the modeled sale is long-term or short-term. The calculator stacks a positive long-term gain on taxable income — the other wages entered plus the vest income, less the 2026 standard deduction — through the 0%, 15%, and 20% federal bands, and adds applicable Net Investment Income Tax measured against the gross figure before that deduction; a short-term gain uses the ordinary brackets. It shows losses but does not invent a tax benefit because annual loss limits, other gains, wash-sale rules, and carryovers require more information.
After taxes, the remaining shares are an investment in the employer. Tax and portfolio decisions are related but distinct; compare the holding with your cash needs, diversification, trading windows, and company policy.
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Worked example
If 1,000 shares vest at $50, the compensation value is $50,000. Withholding 220 shares represents $11,000 of tax payments at that price and leaves 780 shares with $39,000 of vest-date value.
If 500 retained shares are later sold at $60, their proceeds are $30,000 and their basis is $25,000, producing a $5,000 gain. The calculator places that gain in the applicable 2026 federal band based on holding period, filing status, and taxable income — the other wages entered plus the vest income, less the standard deduction — then adds the selected-state estimate.
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Questions people ask
Are RSUs taxed when granted or vested?
Typical RSUs are generally taxed as compensation when they vest and settle, not when granted. Plan terms, private-company deferral rules, and unusual arrangements can differ.
Why did my employer withhold shares?
Share withholding is one way to fund required income and payroll withholding. It reduces shares delivered but does not establish the final tax on your return.
What is the cost basis of RSU shares?
For a typical vest, basis generally includes the fair market value already recognized as wage income. Track it by lot and verify broker reporting before filing.
Is selling RSUs immediately a capital gain?
A sale close to vest can still have a small gain or loss because the market price and transaction costs may differ from vest-date fair market value.
Can I make an 83(b) election for ordinary RSUs?
Generally no, because an RSU is not transferred property at grant. Restricted stock awards are different, and special Section 83(i) rules can apply to qualified private-company equity.
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Sources and model basis
This calculator is for tax year 2026 — the return filed in early 2027. Rates, brackets, deductions and limits are the ones in force for 2026, including changes enacted during 2026 that apply retroactively to the whole year. It does not estimate any other year.
Published rules and formulas are linked below. Values supplied by the visitor remain scenario inputs, not factual claims.
- IRS Publication 525: Taxable and Nontaxable IncomeEmployee compensation, restricted property, and qualified equity grant context
- IRS Publication 551: Basis of AssetsGeneral basis rules and restricted-property context
- IRS Publication 15 (2026)Supplemental wage and payroll withholding rules
- IRS: Topic No. 409 Capital Gains and LossesHolding period, rates, and capital-loss overview