Why do I owe taxes on my RSUs when they already withheld some?

RSUs vest as ordinary wage income and are usually withheld at the flat 22% federal supplemental rate. If your real marginal bracket is higher — 24%, 32%, 35% or 37% — that 22% is too low, so you can owe the difference when you file. It isn't a penalty; it's the gap between flat withholding and your actual rate.

How are RSUs taxed at vesting in 2026?

At vesting the fair market value of the shares is ordinary W-2 income. Employers withhold federal at a flat 22% on supplemental wages up to $1,000,000 (37% above), plus Social Security 6.2% up to the $184,500 wage base, Medicare 1.45% (plus 0.9% over $200,000), and any state rate. A later sale is a separate capital-gains event.

How do I avoid a surprise RSU tax bill?

Estimate your real marginal rate, compare it to the 22% withheld, and set aside the difference — or ask payroll to withhold extra or make an estimated payment. This calculator shows the exact gap for your income.

Myth vs. fact · US 2026

RSU tax calculator: why do I owe tax on my RSUs?

Because the flat 22% withheld at vesting is often too low. RSUs vest as ordinary income, but your employer usually withholds the fixed 22% supplemental rate — while your real bracket may be 32%, 35% or 37%. The difference lands as a bill at filing. Enter your numbers to see what's withheld now and the gap you may owe later.

Your RSUs

RSU value vesting now (USD)

Filing status

Your other taxable income this year, not counting this RSU (USD)

Wages already earned this year (optional)

Your state income-tax rate, if any (optional %)

What you keep now (after vesting withholding)

What's withheld at vesting

The gap most people miss (at filing)

How RSU tax & withholding works & data sources

When RSUs vest, the fair market value of the shares is ordinary wage income (reported in Box 1 of your W-2). Because it's paid apart from regular salary, employers withhold federal income tax at the flat 22% supplemental rate on amounts up to $1,000,000 a year, and a mandatory 37% above $1M. It's also subject to FICA: Social Security 6.2% up to the 2026 wage base of $184,500 (once your year-to-date wages pass that, Social Security stops), Medicare 1.45% with no cap, and an Additional Medicare 0.9% on wages over $200,000. The catch: that flat 22% is withholding, not your final tax. Your RSU income stacks on top of your other income, so your real marginal rate may be 24–37% — and if it's above 22%, you owe the difference when you file. Employers commonly sell or hold back shares ("sell-to-cover") to fund the 22% — which is exactly why higher earners get a surprise bill. A later sale of the shares is a separate capital-gains event, measured from the vest-date value.

✅ Rules verified as of July 19, 2026 — IRS Pub. 525 & Pub. 15 (Circular E) 2026; SSA 2026 wage base; Rev. Proc. 2025-32 brackets · Withholding estimate, not tax advice.

Sources: IRS — Pub. 525 (RSUs as wage income) · IRS — Pub. 15 (22%/37% supplemental) · SSA — 2026 wage base ($184,500) · IRS — 2026 tax brackets

Frequently asked questions

Why do I owe taxes on RSUs that were already taxed?

They weren't fully taxed — they were withheld at a flat 22%. If your real marginal bracket is higher (24%, 32%, 35% or 37%), the 22% covered only part of it, and you settle the rest at filing. It feels like a surprise because withholding ≠ final tax.

How much is really taken from my RSUs at vesting?

22% federal, plus Social Security (6.2% up to $184,500 of wages), Medicare (1.45%, plus 0.9% over $200k), and any state rate — often 30–45% withheld in high-tax states. This tool shows the exact split.

How do I avoid the RSU tax surprise?

Estimate your real marginal rate (this calculator does it), set aside the gap above 22%, and consider asking payroll to withhold extra or making a quarterly estimated payment. Selling some shares at vest to cover it is common.

What about when I sell the shares later?

That's a separate event. Your cost basis is the vest-date value already taxed as income. Any gain above it is a capital gain — short-term (ordinary rates) if held ≤1 year, long-term (0/15/20%) if held >1 year — so you're not taxed twice on the same value.