What do all my equity events mean for taxes this year?
RSU vests, ISO exercises, NQSO exercises, stock sales, K-1 income — each one creates tax exposure that your CPA and your financial advisor may be seeing in isolation. This tool puts them in one place, shows the combined picture, and surfaces what needs to happen before December 31.
2026 estimates · Federal + California · Not tax advice
Common questions
Are RSUs taxed as ordinary income?
Yes. When RSUs vest, the fair market value of the shares on the vest date is taxed as ordinary income — the same rate as your salary. Federal withholding on RSUs is typically 22%, but if you're in the 35% or 37% bracket, you owe the difference and should make a supplemental estimated payment.
What's the difference between ISOs and NQSOs for taxes?
ISOs (Incentive Stock Options) have no regular income tax at exercise — but the spread (FMV minus strike price) is an AMT preference item and may trigger Alternative Minimum Tax. NQSOs (Non-Qualified Stock Options) create ordinary income equal to the spread at exercise, regardless of when you sell the shares. For high earners, the AMT exposure from ISOs requires careful planning before year-end.
How does concentrated stock affect my taxes?
Selling a concentrated position in a single stock creates capital gain — taxed at 20% federal plus 3.8% NIIT plus state. In California, that's up to 37.1% combined. Strategies to manage this include staged sales across multiple years, charitable vehicles like donor-advised funds, or exchange funds — all of which require coordination between your CPA and advisor.
When should I adjust my quarterly estimated payments for equity events?
Any time you have a large equity event — RSU vest, option exercise, or stock sale — that wasn't included in your original quarterly estimate. The safest approach: after each significant event, recalculate your year-to-date income and true-up with the next quarterly payment. The penalty for underpayment is modest, but a large April surprise is avoidable.
Coordinate the plan
Bring both advisors the same numbers
RSU vesting events, ISO exercises, estimated payments, and holding decisions all touch both your CPA and your financial advisor — and nothing falls through the gap between two separate conversations when they’re both looking at this same picture.
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One form, filed within 30 days of a grant with zero exceptions, that decides whether you're taxed on a near-zero valuation now or on whatever the stock is worth at each future vesting date. The upside can be enormous. So can the downside if the company doesn't work out.
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Coordinate RSU vesting, ISO/AMT exposure, and concentrated positions so your CPA and advisor are working from the same picture.