RSU Tax Calculator
RSUs vesting soon? Estimate the 2025 federal withholding on the vest — the 22% supplemental rate plus Social Security and Medicare — and see how many shares are sold to cover and how many you actually keep.
Reviewed by the CalcCafe editorial team · Last updated 18 July 2026 · How we test our tools
Example
Suppose 500 RSUs vest at $120 a share with $150,000 of year-to-date wages, and your plan sells 22% to cover. The vest is worth $60,000 of ordinary W-2 income. Federal withholding runs 22% ($13,200), Social Security 6.2% on the $26,100 still under the 2025 wage base ($1,618), and Medicare $960 including the 0.9% surtax on the portion above $200,000 — about $15,778 in total. Sell-to-cover at 22% sells 110 shares, leaving 390 shares worth about $46,800. Note the actual withholding estimate (26.3%) exceeds the 22% sold — a preview of the classic RSU shortfall.
How it works
Vest value = shares vesting × share price at vest, and that full amount is ordinary W-2 income in 2025. Federal withholding uses the supplemental-wage percentage method: a flat 22% on the first $1,000,000 of supplemental income and a mandatory 37% above it. Social Security at 6.2% applies only to the slice of the vest that fits under the 2025 wage base of $176,100 given your year-to-date wages; Medicare is 1.45% on the whole vest plus the 0.9% Additional Medicare Tax on the portion that pushes total wages past $200,000. Shares sold to cover = vest value × your cover percentage ÷ share price; net shares = shares vesting minus shares sold. Federal only, 2025 tax year, educational estimate — state withholding is excluded.
Good to know
RSUs are taxed as ordinary income the moment they vest — the fair market value of the shares lands on your W-2 exactly like salary, whether you sell or hold. There is no way to defer it by holding the shares, and holding does not convert the vest itself into capital gains. Your employer withholds through the vest, most commonly by selling a slice of the shares (sell-to-cover) or by net settlement, which is why fewer shares hit your brokerage account than vested.
The classic RSU surprise tax bill comes from the 22% default. Employers typically withhold supplemental income at a flat 22%, but a big vest usually lands on top of a full salary, so its true marginal rate is often 24%, 32% or 35%. Withhold 22% while owing 35% on a $100,000 vest and you are roughly $13,000 short at filing time — plus a possible underpayment penalty. Compare the flat rate to your marginal bracket, and cover any gap with estimated payments, extra W-4 withholding, or by asking whether your plan allows a higher withholding election. Only above $1,000,000 of supplemental wages does the mandatory 37% rate apply.
Your cost basis in the shares you keep equals the price at vest — the same amount already taxed as W-2 income. Track it carefully: brokers sometimes report a $0 basis on Form 1099-B, and accepting that number means paying tax on the same dollars twice when you sell. Only movement after the vest is capital gain or loss — sell immediately and there is roughly none; hold for more than a year past vest and further appreciation qualifies for long-term capital gains rates.
Two final points of scope. An 83(b) election does not apply to RSUs — it works only for restricted stock actually issued at grant, whereas RSUs are a promise of future shares, so there is nothing to elect on. And this calculator is a federal-only, 2025 tax year, educational estimate of withholding: state income tax on the vest, Social Security already capped by other jobs, 401(k) deferrals, and your final April reconciliation are all outside the model, so confirm large vests with a tax professional.
Frequently asked questions
How are RSUs taxed when they vest?
The fair market value of the shares on the vest date is ordinary income reported on your W-2, taxed like salary at your marginal rate. Employers typically withhold a flat 22% federal (37% above $1 million of supplemental wages) plus Social Security and Medicare, usually by selling some shares to cover. Only price movement after vest is capital gain or loss.
Why might I owe more tax on my RSUs at filing time?
Because the default 22% supplemental withholding is often below your real marginal rate. A large vest stacked on a salary frequently falls in the 32% or 35% bracket, so 22% under-withholds and the shortfall comes due with your return, sometimes with an underpayment penalty. Check your bracket and top up via estimated payments or extra W-4 withholding.
Does this calculator include state taxes on RSUs?
No — it estimates 2025 federal withholding only. Most states also tax RSU income at vest and many withhold at their own supplemental rates, so your net shares may be fewer than shown. It is an educational planning estimate, not tax advice.
Is this calculator free, and is my equity data uploaded anywhere?
Yes, it is completely free with no sign-up, and no — it runs entirely in your browser. Your share counts, prices and wage figures never leave your device.
People also ask
What is my cost basis in RSU shares?
The share price on the vest date — the same value that was taxed as W-2 income. Keep your vest confirmations, because brokers sometimes report a $0 basis on Form 1099-B; if you file with that unadjusted number you pay tax on the same income twice. Gains or losses on sale are measured only from the vest price.
Should I sell my RSUs as soon as they vest?
Tax-wise, selling at vest costs almost nothing extra — the income was already taxed at vest, so an immediate sale has roughly zero capital gain. Holding is effectively choosing to invest that cash in your employer's stock; if you do hold, shares kept more than a year past vest get long-term capital gains treatment on further appreciation.
Can I file an 83(b) election for RSUs?
No. An 83(b) election applies only to restricted stock that is actually transferred to you at grant. RSUs are an unfunded promise to deliver shares later, so there is no property at grant to elect on — tax always lands at vesting (or delivery) at ordinary income rates.
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Sources & references
These tools follow our methodology and provide educational estimates only — verify important figures with a qualified professional.