You received a refresh or retention RSU grant on top of your original new-hire award. Vests from both grants hit the same W-2, withholding gaps feel worse, and you want to know whether refresh RSUs are taxed differently from your first grant.
In plain terms
Gather before you start
- Equity portal list of all active grants (original, refresh, promotion, retention).
- schedule for each grant ID separately.
- Year-to-date wages from your last pay stub.
- Recent refresh grant acceptance email with share count and start date.
- Expected salary, bonus, and other events this year.
Grant labels and vest schedules come from your employer's plan. Refresh policies vary by company.
How the tax works
Employers grant refresh to retain employees after performance reviews, promotions, or market adjustments. Each grant is a separate legal award with its own schedule, but tax law treats every delivery date the same: at is compensation.
Refresh grants often start immediately or on the next quarterly cycle, while your original grant may still be on its cliff-plus-quarterly path. Two grants can produce overlapping dates in the same month.
Tax software and mental models sometimes assume one line on the . In practice, your employer may aggregate all wages into Box 1 without separating grants. You need grant-level records for planning even if the is one number.
applies per event, not per grant lifetime. A refresh in March and an original-grant in March each run through supplemental payroll. Two 22% withholdings on two large events still may not cover your combined .
Refresh grants at promotion sometimes cliff again on a shorter schedule (for example six months). That creates a second cliff feeling even for tenured employees.
Refresh size relative to original grant varies by level and company policy. A $50,000 refresh quarterly adds the same tax mechanics as a $50,000 slice of a larger new-hire grant.
Stock price on each refresh sets wage income independently. A refresh granted when the stock was $80 still taxes at on the actual , which might be $120 or $60.
More detail (7 additional points)
on refresh vests works identically: full is wages; shares sold for produce a small line later.
Performance-based refresh grants that fail to meet metrics may never — no tax until delivery. Time-based refresh vests on schedule like standard .
Refresh grants after a job change at the same company (internal transfer) still through the same employer . Refresh after joining from outside is a new grant with its own schedule.
Multiple refresh grants in one review cycle (retention plus promotion) can mean two new schedules starting the same quarter. Model combined , not each grant in isolation.
State income tax follows wage sourcing rules for each . A refresh after a move may involve multi-state questions covered in moving-state guides.
Refresh grants do not reset your holding period on shares from earlier vests. Each lot keeps its own for later sales.
Annual income estimators help when you have three or more active grants. Enter each tranche or total expected value for the year.
What to check on your end
- Separate grant IDs and calendars in the equity portal.
- Which refresh tranches this calendar year vs next year.
- Combined forecast vs salary for bracket planning.
- Supplemental rate on each confirmation.
- Whether promotion refresh has its own cliff date.
- share count on refresh vests vs original grant vests.
- Box 1 trend after first refresh — gap vs expectations.
2 more checklist items
- Bonus or exercise scheduled in the same quarter as a large refresh .
- 401(k) and HSA deferrals — wages count toward compensation limits.
Assuming refresh RSUs are taxed at a lower rate because they are retention pay
What to pull from your files
- Refresh grant agreement and schedule table.
- Each confirmation PDF (original and refresh).
- Pay stubs showing lines.
- Equity portal forecast export if available.
- after year-end — compare to sum of confirmations.
Original quarterly grant plus annual refresh at a large tech employer
Illustration only, not your tax situation.
Questions people ask
- Are refresh RSUs taxed differently from my original RSU grant?
- No for standard plans. Each is wage income at on the delivery date. Refresh is a label for a new grant, not a different IRS category.
- Why did my W-2 jump more after my refresh started vesting?
- You now have two streams. Combined in one year increases Box 1 wages and may push gaps if flat supplemental rates applied on each .
- Do refresh grants have a cliff?
- Depends on your grant agreement. Some refresh awards ratably each quarter; others cliff after six or twelve months. Read the schedule table for that grant ID.
- Can I decline a refresh grant for tax reasons?
- Declining avoids future income but is an employment compensation decision, not a tax strategy most people use. Unaccepted grants never and never create wages.
- How do I estimate tax on refresh plus original vests?
- Use the annual income estimator with total expected from all grants, then the gap calculator with your salary and expected .
When a CPA is worth it
- Refresh plus large exercise or purchase in one year.
- Refresh near a multi-state move.
- Performance refresh with partial or clawback language.
- Total equity comp above thresholds.
Sources and notes
Primary tax claims on this page are supported by the official and secondary sources below. Broker and software links describe reporting mechanics — confirm rules against IRS or state guidance.
Each refresh vest taxed as wage income at FMV; supplemental withholding per vest event.
- IRS Publication 525 — Taxable and Nontaxable Income
Internal Revenue Service · Official
Covers compensation income from stock-based pay, including restricted property under section 83.
- IRS Publication 15 (Circular E) — Supplemental wages
Internal Revenue Service · Official
Section 7 describes supplemental wage withholding, including the optional 22% flat rate and 37% rate above $1 million of supplemental wages in a calendar year.
- Equity Compensation — RSU taxation at vest and on sale
Charles Schwab (Workplace Financial Services) · Brokerage explainer
Plain-language explainer: RSU value at vest on W-2, FICA, withholding may not cover full tax, separate capital gains on sale.
Related calculators
- Annual RSU Income Estimator
Total your expected RSU ordinary income for the year — a starting point before running detailed tax estimates.
- RSU Withholding Gap Calculator
Focus on the gap between what your employer withholds on RSU vests and what you may owe when everything is reconciled.
- RSU Tax Calculator
Model federal and state taxes on your RSU vest, compare withholding to estimated tax, and see what you may keep.
Related pages
- How RSUs Are 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.
- RSU Cliff Vest Tax
Cliff vests use the same wage-at-vest rules as any RSU delivery — the shock is size, not tax law. Model FMV and withholding before cliff day.
- RSU and Bonus in the Same Year
Multiple supplemental wage events in one year can push you into higher marginal brackets — flat withholding on each event may still leave a year-end gap.
- RSU Tax Guide for Software Engineers
Engineers often stack salary, bonus, and multiple RSU vests — plan withholding before each vest hits.
For learning, not filing
VestingTax.com is not a CPA firm or tax preparer. Grants, employers, and states all differ. Use the cited IRS and state sources above, your own documents, and a qualified tax professional before you make decisions from this guide.