RSU & Stock Option Tax Estimator

How to Use This Tax Estimator

Follow these steps in order — every result on the right updates live as you type or drag a slider.

1. Pick your award type. Choose RSU for restricted stock units, NSO for non-qualified stock options, or ISO for incentive stock options. The tax math changes completely between them, so this choice drives everything below.
2. Enter your grant. Add the number of shares, then the price at the taxable event — that is the fair market value at vesting for RSUs, or at exercise for options. For options, also enter your strike price (what you pay per share to exercise).
3. Set your sale price. Enter what you expect to sell each share for. The difference between this and the taxable-event price is the appreciation that gets capital-gains treatment.
4. Answer the holding questions. For ISOs, say whether your sale will be a qualifying disposition (held 2 years from grant and 1 year from exercise). For everything else, say whether you held the shares more than a year after vesting or exercise — that decides whether later growth is taxed at lower long-term capital-gains rates.
5. Set your tax rates. Enter your federal marginal bracket (10%–37%), your state income-tax rate, and your long-term capital-gains rate (usually 15%). Watch Estimated total tax and Effective tax rate — they tell you what the government keeps.

Reading your results

• Taxable ordinary income: the chunk taxed like salary at vesting (RSU) or exercise (NSO, disqualifying ISO).
• Estimated total tax: federal + state on ordinary income, plus capital-gains tax on later appreciation, plus a simplified AMT estimate for ISOs.
• After-tax gain: sale proceeds minus what you paid to exercise minus all estimated taxes — what you actually keep.
• Effective tax rate: total tax divided by your pre-tax gain. If this surprises you, better now than in April.

What Is the RSU and Stock Option Tax Estimator?

The RSU and Stock Option Tax Estimator is a free equity-compensation tax calculator that shows what you will actually owe — and keep — when your company stock pays out. If you work in tech or finance, a large share of your compensation probably arrives as RSUs (Restricted Stock Units), NSOs (Non-Qualified Stock Options), or ISOs (Incentive Stock Options). Each is taxed differently, at different times, and the bill routinely surprises people by tens of thousands of dollars.

This tool models the three taxable moments that matter. Vesting (RSUs): the shares become yours and their market value is taxed as ordinary income, like salary. Exercise (options): for NSOs the discount to market value — the “spread” — is ordinary income immediately; for ISOs there is no regular income tax at exercise, but the spread can trigger the Alternative Minimum Tax (AMT). Sale: any growth after the taxable event is a capital gain, taxed at lower long-term rates if you held more than a year. Enter your grant, prices, holding periods, and tax brackets; every result updates instantly.

The Exact Formula Behind the Math

Every number on this page comes from standard U.S. equity-tax rules. For RSUs, ordinary income = shares × fair market value at vest. For NSOs, ordinary income = (FMV at exercise − strike price) × shares, floored at zero. For ISOs with a qualifying disposition (sold at least 2 years after grant and 1 year after exercise), there is no ordinary income at all: the entire gain, (sale price − strike) × shares, is taxed as long-term capital gain. With a disqualifying disposition, ordinary income = min(bargain element, actual gain per share) × shares, and the remainder is capital gain.

From there: federal tax = ordinary income × your marginal federal rate; state tax = ordinary income × your state rate. Employers typically withhold a flat 22% federal on supplemental wages like RSU vests — often less than your bracket, which is why April brings surprises. Appreciation after the taxable event is taxed at your long-term capital-gains rate if held over a year, otherwise at ordinary rates. For ISOs, the tool adds a simplified AMT estimate = bargain element × 26% (real AMT uses an exemption and 26%/28% brackets, and often generates a credit against future regular tax). Total tax is the sum of all pieces; after-tax gain = sale proceeds − exercise cost − total tax; effective tax rate = total tax ÷ pre-tax gain.

Why This Matters for Finance and Tech

In tech and finance, equity is not a bonus — it is the compensation. RSU refreshers, option grants, and ESPP purchases can dwarf base salary, which means tax planning is compensation planning. The classic expensive mistakes are all avoidable with a calculator: exercising ISOs without modeling AMT and discovering a five-figure tax bill on shares you have not sold; assuming the 22% employer withholding covers a 32%+ bracket; selling NSO shares days after exercise and converting what could have been long-term gains into short-term ones; or holding RSUs through a price drop and paying ordinary income tax on value that no longer exists.

Running the numbers before you act turns equity from a lottery ticket into a plan. You can compare exercising ISOs this year versus next, see exactly how much a qualifying disposition saves versus selling early, and decide how many shares to sell immediately to cover withholding. Ten minutes with this estimator can easily be worth more than a year of salary negotiation.