--- title: "Texas RSU Tax Calculator (2026): Withholding, Shortfall, and Vesting Examples" slug: tx-rsu-vesting-tax publishedAt: 2026-06-16T17:00:15.000Z updatedAt: 2026-06-17T16:41:54.896Z author: "Mike Navarro" authorSlug: mike-navarro category: "State Tax" tags: ["Texas", "RSU", "Withholding", "Vesting", "State Tax"] excerpt: "Texas RSU tax calculator for 2026: no state income tax at vest, 22% federal supplemental, no TX capital gains. Run your numbers in 60 seconds." canonical: https://myequitytax.com/blog/tx-rsu-vesting-tax --- The texas rsu tax calculator pairs the 22% federal supplemental rate against your real bracket — Texas has no state income tax and no state capital gains tax, so every dollar of withholding gap on your RSU vest is purely federal. Run your numbers below. [**Open the Texas RSU tax calculator with these inputs prefilled →**](/calculator/rsu?state=TX&shares=100&fmv=80&salary=120000) ## How Texas taxes your RSU vest Texas has no state income tax, so RSU vesting and ISO exercises are not subject to state income tax. The fair market value of your shares on the vest date hits your W-2 in Box 1 as ordinary wage income at the federal level, but nothing is withheld for Texas at the state line — and nothing is owed at filing time for the vest itself. That's the simplest possible state-tax setup for equity compensation: the entire state column on every other state's RSU calculator collapses to zero in Texas. Texas also has no state capital gains tax. When you eventually hold and sell post-vest shares, only federal capital gains rates apply — the state line stays at zero whether the sale is short-term or long-term. That makes Texas the easiest state in the country for equity-comp planning. The only numbers that matter are federal: ordinary income at vest, federal capital gains at sale, and AMT if you also hold ISOs. The two numbers that matter on every vest: - **Federal supplemental withholding rate:** 22% on RSU income up to $1M ([IRS Publication 15](https://www.irs.gov/publications/p15)). Above $1M, the rate jumps to 37%. - **Texas supplemental withholding rate:** 0% — Texas has no state income tax, so employers withhold nothing for the state on RSU vests. If your federal marginal bracket is higher than the 22% supplemental rate, your employer is under-withholding the federal portion — and you owe the difference at filing time. There is no parallel state shortfall to worry about in Texas. ## Worked examples (Texas, 2025) These three scenarios use the EquityTax calculator with the inputs shown. The math is identical to what you'll see when you click through to the calculator. ### Example 1 — Junior IC, $120K salary, single **Inputs:** $120,000 salary, single filer, 100 RSUs vesting at $80 FMV (one vest, March 2025). **Result:** - Total RSU income: $8,000 - Federal withholding: $1,760 - Texas withholding: $0 - Estimated total tax on the vest: $2,532 - **Shortfall vs default withholding:** $160 At a 24% federal bracket and a 0% Texas bracket, the federal supplemental rate of 22% is two points light. The result is a $160 federal shortfall on this vest — small enough to absorb at filing time. The Texas column is flat zero across the board. [Run this scenario in the calculator →](/calculator/rsu?state=TX&shares=100&fmv=80&salary=120000) ### Example 2 — Mid IC, $210K salary, MFJ **Inputs:** $210,000 salary, married filing jointly, 400 RSUs vesting at $120 FMV. **Result:** - Total RSU income: $48,000 - Federal withholding: $10,560 - Texas withholding: $0 - Estimated total tax on the vest: $11,724 - **Shortfall vs default withholding:** $396 At $258,000 of combined household income (W-2 plus the vest), the marginal federal bracket is 24% — only two points above the 22% supplemental rate. The federal shortfall lands at $396 for the vest, well under the safe-harbor thresholds for an underpayment penalty in most cases. The Texas column stays at zero — no state shortfall, no state penalty exposure, no state filing. [Run this scenario in the calculator →](/calculator/rsu?state=TX&shares=400&fmv=120&salary=210000) ### Example 3 — Senior IC, $350K salary, MFJ **Inputs:** $350,000 salary, married filing jointly, 1,500 RSUs vesting at $200 FMV. **Result:** - Total RSU income: $300,000 - Federal withholding: $66,000 - Texas withholding: $0 - Estimated total tax on the vest: $100,485.50 - **Shortfall vs default withholding:** $27,435.50 This is where the 22% federal supplemental rate falls apart for Texas high earners. A $300,000 vest on top of $350K of base salary pushes the household firmly into the 35% federal bracket. The 22% withholding leaves a $27,435.50 federal gap on the vest. Add the $1,920.49 underpayment penalty and the total owed at filing is $29,355.99. A quarterly federal estimated payment is essentially mandatory at this income level. Texas still owes zero at vest — and zero on any future sale, even if the post-vest shares appreciate further. [Run this scenario in the calculator →](/calculator/rsu?state=TX&shares=1500&fmv=200&salary=350000) ## Why employer withholding usually isn't enough in Texas The Texas shortfall story is entirely federal. The 22% federal supplemental rate sits below the 24%, 32%, 35%, and 37% federal brackets that kick in at higher Austin, Dallas, and Houston tech incomes. Because Texas has no state income tax, there is no state-side over-withholding to offset the federal under-withholding — every dollar of the federal gap shows up on your return as a balance due. The fix is straightforward and depends on the size of the gap: 1. **Adjust your W-4** so your paycheck withholding picks up the difference across the year ([IRS W-4 instructions](https://www.irs.gov/forms-pubs/about-form-w-4)). 2. **Make a quarterly estimated payment** if the shortfall is concentrated around a single vest date — federal estimates go to [IRS Form 1040-ES](https://www.irs.gov/forms-pubs/about-form-1040-es). Texas has no state estimated-tax form for income. 3. **Sell-to-cover at vest** — if your broker offers it, this can absorb the federal gap automatically. The 22% federal supplemental rate is a default — not your actual marginal rate. If your total income (salary + RSU) puts you in the 32%, 35%, or 37% bracket, the federal under-withholding can be large — and in Texas there's no state over-withholding to soften it. ## How the texas rsu tax calculator handles Texas The Texas calculator uses Texas's actual 2025 rules, not a generic state placeholder: zero state income tax on the RSU vest itself, zero on later capital gains, and no state estimated-tax filing required. It separates default employer withholding (22% federal + 0% Texas + FICA) from the incremental tax you'll actually owe based on your full federal bracket — that's how it surfaces the federal shortfall figure that matters at filing time. [Open the calculator with your inputs →](/calculator/rsu?state=TX) ## FAQ **Does Texas tax RSU vesting income?** No. Texas has no state income tax, so RSU vesting and ISO exercises are not subject to state income tax. Only the federal supplemental rate of 22% (or 37% above $1M of supplemental wages in a year) and FICA apply at the vest event. **Does Texas have a capital gains tax on RSU sales?** No. Texas has no state capital gains tax. When you sell post-vest shares, only federal capital gains rates apply — short-term gains taxed as ordinary federal income, long-term gains taxed at 0%, 15%, or 20% depending on your federal bracket. **Why does my Texas RSU vest still leave a shortfall at tax time?** Because the 22% federal supplemental rate is below the marginal federal bracket of most mid-to-senior tech employees in Austin, Dallas, and Houston. The shortfall is entirely on the federal line — Texas has no state component — so the fix is a W-4 adjustment or a federal 1040-ES estimated payment. **Should I make an estimated payment after a big RSU vest in Texas?** If your federal shortfall on a single vest is sizable, you're likely facing an underpayment penalty under [IRS Form 2210](https://www.irs.gov/forms-pubs/about-form-2210) unless you cover it via a quarterly federal estimated payment on Form 1040-ES. Texas has no parallel state estimated-tax form for income. Run your scenario in the calculator above to see the exact number. ## Sources - IRS Publication 525, *Taxable and Nontaxable Income* — RSU treatment, fair-market-value rules. - IRS Publication 15, *Employer's Tax Guide* — federal supplemental withholding rate (22% / 37%). - [Texas Comptroller of Public Accounts](https://comptroller.texas.gov/taxes/) — Texas state taxes (no state income tax, no state capital gains tax). - EquityTax Texas RSU Calculator (internal engine, last verified 2026-05-09). *Estimate only — not financial or tax advice. Consult a qualified CPA before making decisions about exercising stock options, selling equity, or other financial moves.*