Does California withhold enough on RSUs?

Often closer than federal. CA uses a 10.23% supplemental rate on stock compensation. Top CA marginal rates run 9.3%–13.3%, so the state gap is usually thousands, not tens of thousands — unless you are over the 13.3% millionaire line.

I might leave California this year. Does that change the vest?

Possibly. CA asserts tax on income sourced to CA, including equity earned while a resident. Moving is a facts-and-circumstances residency test (home, voter, kids’ school, time in state). Do not DIY that on a calculator. Ask a CA-licensed CPA before you treat a vest as non-CA.

California

California RSUs: the federal 22% hole is the bill. CA supplemental is close.

Reviewed August 21, 2026. About. Not tax advice.

For a 2026 single filer in California with $285k W-2, $210k RSU vests, and $40k bonus, Vestgap’s desk estimates $34,925 still due after withholding. About $32,500 is federal; California’s 10.23% supplemental withholding is close to a 10.3% high-earner rate, so the state gap is small ($175). The scare is federal, not FTB.

Worked example

Bay Area IC, single, 2026: salary $285,000, RSUs $210,000, bonus $40,000. Marginal federal 35%. Still due $34,925. Two estimated-tax installments left in this cycle would be about $17,463 each if you only split the gap — confirm safe harbor with last year’s tax.

Sources

Federal brackets and standard deduction: IRS Revenue Procedure 2025-32. Supplemental withholding: IRS Publication 15 (Circular E), 22% / 37%. California supplemental 10.23% is FTB/EDD practice for stock compensation; we do not compute SDI, NIIT, or AMT here.

FAQ

Does California withhold enough on RSUs?: Often closer than federal. CA uses a 10.23% supplemental rate on stock compensation. Top CA marginal rates run 9.3%–13.3%, so the state gap is usually thousands, not tens of thousands — unless you are over the 13.3% millionaire line.
I might leave California this year. Does that change the vest?: Possibly. CA asserts tax on income sourced to CA, including equity earned while a resident. Moving is a facts-and-circumstances residency test (home, voter, kids’ school, time in state). Do not DIY that on a calculator. Ask a CA-licensed CPA before you treat a vest as non-CA.

Sources

IRS Publication 15 (Circular E) — Supplemental wage withholding: 22% up to $1 million, 37% above.
IRS tax year 2026 inflation adjustments (Rev. Proc. 2025-32) — 2026 federal brackets and standard deduction.
IRS estimated taxes — 1040-ES installment dates and underpayment penalty.

Open the CA sample