Restricted stock units (RSUs) are company shares granted to employees. RSUs on Form W-2 indicate that shares have been delivered to you, which usually happens after vesting. RSUs appear in Box 14 of your W-2. They are already included in your total wages, which appear in Box 1.
Does taxable income include RSU?
With RSUs, you are taxed when you receive the shares. Your taxable income is the market value of the shares at vesting. If you have received restricted stock units (RSUs), congratulations—this is a potentially valuable equity award that typically carries less risk than a stock option due to the lack of leverage.
When to include restricted stock on your W-2?
Alert: If you made a Section 83 (b) election to be taxed on the value of restricted stock at grant, your W-2 for the year of grant, not vesting, will show the income and withholding. If you exercised nonqualified stock options last year, the income you recognized at exercise will be reported on your W-2.
Where does stock option income go on a W-2?
Stock Options. If you exercised nonqualified stock options last year, the income you recognized at exercise will be reported on your W-2. The income from a nonqualified stock option (NQSO) exercise appears on the W-2 with other income in: Box 1: Wages, tips, and other compensation.
Do you have to report stock compensation on Form W-2?
Along with snowflakes, Form W-2 is in the air—or rather, hopefully either in your safe possession or on its way to you. Employees who had income from stock compensation or an employee stock purchase plan in 2014 must understand where that income is reported on Form W-2 so that they can complete their tax returns properly.
How are restricted stock units taxed in the IRS?
The amounts of taxable income and the taxes withheld are included in the corresponding boxes of your Form W-2. If you have restricted stock units, the taxation is similar, except you cannot make an 83 (b) election (discussed below) to be taxed at grant.
