What this calculator answers
This tool estimates federal amounts an employer may withhold from one supported 2026 stock-settled RSU event when the award is separately identified as supplemental wages and the optional flat-rate method is available. It starts with gross units multiplied by the payroll fair market value, then shows federal income tax withholding, employee Social Security tax, regular Medicare tax, and employer-administered Additional Medicare Tax withholding.
The result is a payroll estimate. It does not calculate the employee’s final federal income tax, refund, balance due, state or local withholding, capital gain or loss, brokerage proceeds, investment return, or the number of whole shares a plan will actually withhold. The calculation deliberately stops when the employer uses the aggregate withholding method or the award has facts that require a different wage or timing analysis.
RSU withholding is not the same as RSU tax
Federal income tax withholding is a payment credited toward the complete return. Final tax depends on filing status, total household income, deductions, qualified dividends, capital gains, credits, Alternative Minimum Tax, Additional Medicare Tax liability, other payments, and every other applicable return item. The fact that an employer withholds 22% from a supported supplemental wage payment does not cap the marginal rate on that wage at 22%.
An employee whose additional wage income falls in a higher final bracket can be underwithheld even when payroll followed the supplemental wage rule exactly. Another employee can have excess withholding because of deductions, credits, losses, spouse income, or payments elsewhere. Compare a complete projected return with expected total withholding before changing Form W-4 or making an estimated payment.
The 2026 Federal Income Tax Bracket Calculator shows ordinary rate-schedule arithmetic for a supported taxable-income amount, but that result alone is not a complete return. After projecting total tax, withholding, and confirmed payments, the 2026 Quarterly Estimated Tax Calculator can test the general safe-harbor payment framework.
The gross wage value uses units before tax withholding
A sell-to-cover or share-withholding transaction can make a brokerage account show fewer shares than the award that became taxable. If 100 gross units settle at a payroll FMV of $50 and 30 shares are withheld or sold to fund taxes, the wage value does not begin with the 70 deposited shares. Under the supported facts, it begins with all 100 units multiplied by $50, or $5,000.
Enter the employer’s payroll FMV and gross taxable units from the vest, settlement, or pay statement. Do not substitute the current quote, grant-date price, closing price from a different date, net shares received, or sale proceeds. An employer can use a plan-defined valuation convention and payroll timing that does not match a casual brokerage quote.
If vesting and settlement occur on different dates, if units are cash-settled, or if the payroll wage amount does not equal gross units multiplied by the entered FMV, choose the special path. Establish the actual wage amount and timing from the plan, employer statement, Form W-2, payroll records, and qualified guidance rather than forcing the award into this formula.
The 22% method applies only to a supported supplemental payment
IRS Publication 15 describes more than one method for supplemental wages. When the supplemental wages are identified separately and federal income tax has been withheld from the employee’s regular wages in the current or immediately preceding calendar year, an employer can generally use the optional flat 22% rate on the portion not subject to the mandatory over-$1-million rule. No other optional flat percentage is allowed.
An employer may instead aggregate supplemental wages with regular wages and compute withholding as though the total were one regular payroll payment, then subtract withholding attributable to the regular wages. That result depends on the payroll period, Form W-4, prior or concurrent regular wage payment, and other payroll details. Choose the aggregate path and use the actual pay statement or employer calculation; this tool does not guess those missing inputs.
Payroll terminology is decisive. An award appearing on a separate statement or funded with withheld shares does not by itself prove that the optional flat method was used. Confirm the federal income tax withholding line and the employer’s method before comparing the estimate with a real vest.
The $1 million threshold is cumulative
When supplemental wages paid by an employer to one employee during the calendar year exceed $1 million, the excess is subject to withholding at 37%, or the highest federal income tax rate for the year. The calculation considers prior supplemental wages and the current payment together. Businesses under common control can have to aggregate payments for this rule.
Suppose prior 2026 supplemental wages are $990,000 and a supported RSU event creates $50,000 of additional wages. The first $10,000 reaches the $1 million boundary and is modeled at 22%; the remaining $40,000 is modeled at 37%. Entering zero prior supplemental wages would understate withholding by $6,000 in that example.
Regular salary does not belong in the prior supplemental wage box merely because it is subject to income tax withholding. Bonuses, commissions, overtime pay, certain equity compensation, and other payments can be supplemental wages. Use payroll records and Publication 15 classification rules instead of deciding from the payment size or description alone.
Social Security withholding stops at the 2026 wage base
For 2026, the employee Social Security tax rate is 6.2% and the wage base is $184,500. The calculator subtracts prior entered Social Security wages from that base, not below zero, then applies 6.2% to the smaller of the RSU wage value or the remaining base.
If prior Social Security wages are $180,000 and the RSU wage value is $20,000, only $4,500 of the event remains under the wage base. The modeled employee Social Security withholding is $279. If prior wages have already reached $184,500, the current event adds no employee Social Security withholding under the supported single-payroll record.
Separate employers generally do not stop withholding merely because wages at another unrelated employer used the employee’s annual base. Excess employee Social Security withholding from multiple employers can be handled on the federal return under applicable rules, while an employer correction may apply when one employer withheld too much. This tool therefore asks for the wage record used by the employer processing the event and does not combine unrelated employers automatically.
Medicare withholding has no wage-base ceiling
The employee regular Medicare tax rate is 1.45% for 2026 and applies to covered wages without a wage-base limit. The calculator applies 1.45% to the entire supported RSU wage amount even when Social Security withholding is already zero because the Social Security base was reached.
An employer must also begin withholding 0.9% Additional Medicare Tax when wages it pays to one employee exceed $200,000 during the calendar year. The current-event amount subject to that extra withholding is the portion that crosses or lies above $200,000 after considering prior Medicare wages in the same payroll relationship.
This $200,000 employer withholding trigger does not change with the employee’s filing status or spouse wages. Final Additional Medicare Tax liability uses statutory filing-status thresholds and can differ from the amount withheld. Use the 2026 Additional Medicare Tax Calculator after establishing supported Form 8959 wage and self-employment income amounts; do not treat this paycheck withholding figure as the final liability.
Share withholding is a funding mechanism
The result converts total modeled federal withholding into a fractional share equivalent by dividing dollars by the entered FMV. This helps compare a cash amount with a share-based payroll statement. It is not a prediction of actual shares delivered because plan administrators can round up or down, sell shares in the market, combine federal and state obligations, collect cash from another source, or use a permitted maximum rate.
Actual sale proceeds can differ from payroll FMV because of market movement, execution time, fees, and fractional-share handling. A sell-to-cover transaction is also a stock sale that can create a small capital gain or loss between the compensation basis and sale proceeds. Reconcile the vest statement, pay statement, brokerage confirmation, Form W-2, and Form 1099-B rather than assuming the share count proves each tax component.
The displayed value after modeled federal withholding is gross compensation minus only the four federal withholding components in this tool. State and local income tax, disability or family-leave payroll charges, benefit deductions, brokerage fees, foreign tax, employer-specific deductions, and actual rounding can make net delivered value lower.
Basis begins with compensation already recognized
For a standard stock-settled RSU event, the wage value recognized at settlement generally contributes to the basis of the shares received. A broker’s Form 1099-B can still require review because reported basis may be missing or may not reflect compensation already included on Form W-2. Reporting sale proceeds without the correct basis can tax the same economic value twice.
Track each vest separately: settlement date, gross units, payroll FMV, wage income, units withheld or sold, net shares delivered, sale price, fees, and basis assigned to each share. Later appreciation or decline after the compensation measurement point is generally a capital-gain or loss question, separate from the wage and withholding calculation.
The 2026 Long-Term Capital Gains Tax Calculator can model eligible qualified-dividend and net-long-term-gain rate stacking only after basis, holding period, loss netting, and gain category are established. It does not repair an incorrect Form 1099-B or determine whether an RSU sale is long term.
RSUs, restricted stock, ISOs, and NSOs require different paths
An RSU is generally an unsecured promise to deliver stock or cash after conditions are satisfied; it is not stock at grant. Restricted stock is transferred property subject to restrictions and can involve Section 83(b). Incentive stock options can create a Form 6251 adjustment without regular wage income at exercise, while nonstatutory options generally have different compensation timing.
Do not enter an ISO spread in this RSU calculator. For one supported ISO exercise lot, use the 2026 ISO AMT Adjustment Calculator to estimate the possible Form 6251 line 2i adjustment, then complete the broader AMT workflow. For one ordinary employee nonstatutory option exercise, use the 2026 NSO Exercise Tax and Withholding Calculator to keep exercise cost, Code V wages, payroll withholding, and basis separate. For one supported Section 423 sale lot, use the 2026 ESPP Tax and Cost Basis Calculator. The 2026 Stock Compensation Tax Guide provides the full award-routing, income, withholding, basis, sale, and payment workflow. Do not treat an ESPP disposition, performance share unit, restricted stock award, or cash bonus as an RSU merely because company communications use the phrase “equity compensation.”
When this calculator intentionally stops
Choose the special path for deferred settlement, a qualified equity grant election under Section 83(i), nonresident or multistate service allocation, expatriate payroll, a cash-settled award, restricted stock, a Section 83(b) election, unusual nonqualified deferred compensation timing, payroll corrections, a common-paymaster uncertainty, or an employer wage amount that differs from gross units multiplied by FMV.
RSUs can have special FICA timing because nonqualified deferred compensation rules may treat amounts as wages when services are performed or when the substantial risk of forfeiture ends, even if income-tax settlement occurs later. A simplified same-day calculation should not silently override the employer’s payroll treatment. Confirm boxes 1, 3, and 5 expectations and the timing from plan and payroll records.
Choose the aggregate path when the employer combines the award with regular wages for federal income tax withholding. Publication 15-T and Form W-4 inputs then matter. The calculator still stops instead of using 22% because a familiar number is less useful than the correct method.
A practical vest-day workflow
Before the vest, download the grant and settlement terms and confirm gross units, vest date, expected settlement date, valuation convention, withholding method, and funding method. Check year-to-date supplemental wages, Social Security wages, Medicare wages, and federal withholding from the latest pay statement.
Run the supported estimate and save the breakdown. After settlement, compare it line by line with the vest statement and pay statement. Identify whether differences come from FMV, unit count, the aggregate method, the $1 million split, a payroll-tax threshold, state withholding, rounding, or a special rule. Preserve the explanation rather than simply replacing the estimate with the net shares received.
Then update the full-year federal and state projection using total household income and all payments. If withholding appears short, consider a Form W-4 change or a supported estimated payment analysis. Also test concentration risk and cash needs separately; receiving employer stock and owing tax are not reasons to assume the stock should be held.
Three worked examples
Standard vest below all payroll thresholds
One hundred gross units settle at $50, creating $5,000 of supported supplemental wages. With no prior supplemental wages, $1,100 is modeled at the 22% federal rate. If prior Social Security and Medicare wages are $120,000, all $5,000 remains under the Social Security base and below the Additional Medicare withholding trigger. Employee Social Security is $310 and regular Medicare is $72.50, for $1,482.50 of modeled federal withholding and $3,517.50 remaining before other deductions.
The vest crosses the Social Security base and Medicare trigger
A $20,000 vest follows $180,000 of prior Social Security wages and $195,000 of prior Medicare wages. Only $4,500 is subject to 6.2% Social Security withholding, while all $20,000 is subject to 1.45% Medicare. The final $15,000 of the vest lies above the employer’s $200,000 Additional Medicare withholding trigger and is modeled at another 0.9%.
The vest crosses $1 million of supplemental wages
A $50,000 vest follows $990,000 of prior supplemental wages. The tool applies 22% to $10,000 and 37% to $40,000, producing $17,000 of federal income tax withholding before payroll taxes. It does not infer final tax from the 34% blended withholding on this event.
Official sources and 2026 limits
The 22% optional supplemental wage rate, 37% rate above $1 million, aggregate-method alternative, common-control aggregation, 6.2% employee Social Security rate, $184,500 Social Security wage base, 1.45% employee Medicare rate, no Medicare wage ceiling, and $200,000 employer Additional Medicare withholding trigger come from IRS Publication 15 (2026), Employer’s Tax Guide. The detailed aggregate payroll tables and Form W-4 mechanics appear in IRS Publication 15-T (2026).
General restricted property, qualified equity grant, and stock-compensation income guidance appears in IRS Publication 525. The IRS summarizes current payroll-tax rates in Topic No. 751 and provides a broader Tax Withholding Estimator for complete household withholding questions.
This calculator provides educational 2026 federal payroll arithmetic for one narrowly supported RSU event. It is not tax preparation, payroll processing, tax, legal, accounting, valuation, investment, equity-compensation, or financial advice. It does not determine award type, vesting, settlement, FMV, wage timing, withholding method, common control, FICA timing, Form W-2 reporting, basis, capital gain or loss, final income tax, Additional Medicare Tax liability, state or local tax, refund, balance due, penalties, or investment suitability. Verify every input and result with the plan, employer, payroll and brokerage records, current IRS forms and publications, software, and qualified guidance before filing, paying, selling, or changing withholding. Official sources were accessed July 28, 2026.