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Estimate vest tax

When do RSUs actually get taxed?

RSUs are usually taxed as wages when they vest, not when the grant is signed. This guide walks through the timeline in plain terms.

Rates and rules change. Check the tax year and last-reviewed date on each page, then confirm against IRS or state guidance before you file.

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For most employees at public companies, are taxed as wages when they , not when the grant is signed and not when you sell (unless you hold and the price moves). Your employer usually reports the value on your and withholds tax like a bonus.

Why this happens

are a promise of shares in the future. Until they , you generally do not own the stock and do not have taxable income from them yet.

At , the shares (or their cash equivalent) become yours. The IRS treats that as compensation, the same broad category as salary and bonus, based on the on the .

Your employer has payroll obligations at that moment: report the income and taxes. That is why you may see shares sold automatically or extra on your paycheck.

Selling later is a separate event. If you sell after , you may have a or loss based on how the price changed since , but the big wage-income event usually already happened at .

What to check

  • Your grant agreement, schedule, settlement method (shares vs cash), and whether applies.
  • Your confirmation or equity portal, shares delivered, shares sold for tax, and taxes withheld.
  • Your after year-end: income should appear in wages, often with separate or supplemental detail from the employer.
  • Your pay stubs around dates, supplemental may show as a separate line.
  • Whether you moved states or worked remotely during the year, state reporting can differ from federal.

Common mistake

Waiting until you sell to think about tax. The main tax bill typically hits at . If you only look at your brokerage sale later, it can feel like you are being taxed twice, when in many cases the sale is mostly reporting a small gain or loss on top of income already taxed at .

Example scenario (hypothetical)

Illustration only, not your tax situation.

Alex receives 100 that when the stock is $50 per share. The employer reports $5,000 of wage income, withholds federal and state tax (often via ), and delivers the remaining shares to Alex's brokerage. Alex sells 30 shares six months later at $55. The $5,000 was already wage income; the sale may show a short-term on the $5 per share difference ($150 total), not another $5,000 of income.

When to get help from a tax pro

  • You while living in one state and sell after moving to another.
  • Your employer uses an unusual settlement method or you have multiple employers in one year.
  • You are close to Social Security wage base limits or have complex household income.
  • You receive from a foreign parent company or while working abroad.

Related calculators

Related pages

Sources and notes

Federal wage treatment at vest and separate capital-gain treatment on later sale.

For learning, not filing

Grants, employers, and states all differ. Use your own documents and a qualified tax professional before you make decisions from this guide.