05/20/2026
Most people assume their company handles the taxes on their RSUs. And technically, they do. Just not enough of them.
When your shares vest, your employer likely withholds at a flat 22% federal rate. If your income puts you in the 32%, 35%, or 37% bracket, that withholding falls short every time shares vest.
The gap does not announce itself. It shows up in April, when your return reflects income your withholding never fully covered. For someone who has had RSUs vesting for several years without a full picture of how it all adds up, those shortfalls have likely been stacking the whole time.
This is one of the most common situations we see with clients who have equity compensation. Not a crisis, and not the result of doing anything wrong. Just a predictable outcome of a system that reports each piece of your compensation separately, with no one looking at the full picture. If you have equity compensation and have not had that conversation, we are here to help.
This material is for informational purposes only and is not intended as tax or legal advice. The tax treatment of restricted stock units (RSUs) and other equity compensation varies based on individual circumstances, income level, and applicable federal, state, and local tax laws. Employer withholding practices may differ. Cetera Wealth Services, LLC, exclusively provides investment products and services through its representatives. While Cetera does not provide or supervise tax, accounting, or legal services, representatives may offer these through their independent outside business.
