Q3 RSU Vesting 2026: Fix Your Estimated Tax Before Sept 15

She's a VP of Engineering at a large public tech company. Nine years in. Her RSUs vest quarterly at about $150,000 each quarter. The shares hit her brokerage account in late June like they always do. Her company withheld 22% for federal taxes on the supplemental income. Everything looks routine.

Here's what's quietly wrong: 22% is probably less than half of what she'll actually owe on that income. And the September 15 estimated tax payment is the moment to fix it, not next April.

The 22% Gap

The IRS treats RSUs as supplemental wages, and the default withholding rate is a flat 22% on the first $1 million. For a VP of Engineering earning over $600,000 a year in total comp, that 22% lands well below her actual marginal rate.

Here's how the gap adds up on a $150,000 quarterly vest:

Federal withholding at 22%: $33,000
Her actual federal rate (32% bracket): $48,000
Net Investment Income Tax at 3.8%: $5,700
California supplemental withholding at 10.23%: $15,345
Total real tax on that vest: roughly $69,000
Total combined withheld: roughly $48,000
Gap per quarter: about $21,000

Across four quarters, that gap reaches $84,000. That's the number that shows up as a surprise in April.

RSU quarterly vesting tax gap: 22% withholding vs actual tax liability breakdown

We covered the basics of this gap in an earlier post about why 22% withholding isn't enough. Today we're looking at the specific deadline where you can still fix it.

Why September 15 Matters

The tax system gives you four estimated tax deadlines each year: April 15, June 15, September 15, and January 15 of the next year. Most tech executives pay the same amount each quarter based on what they owed last year. That's called the safe harbor method, and it works, up to a point.

The safe harbor protects you from the underpayment penalty as long as you pay 110% of last year's tax (required when your AGI was over $150,000). But here's what it doesn't do: it doesn't actually pay the tax you'll owe this year. It just keeps the IRS from charging a penalty. The difference still comes due in April, in full.

September 15 is the most powerful estimated tax deadline of the year because it's the last point where a meaningful adjustment can still change the outcome. By the time the January 15 payment rolls around, most of the year's income is locked in. September is where you can still make a move.

Walkthrough: A VP With $150,000 in Quarterly RSU Vests

Let's walk through a representative situation. A VP of Engineering at a publicly traded tech company. Eight years in. Her salary is $320,000, and her RSUs add about $600,000 a year in vesting income, or $150,000 per quarter. Total comp comes to roughly $920,000.

Her company withholds 22% on her RSUs. Combined with her salary withholding, she's on track for about $260,000 in total federal and state withholding for the year.

Her real tax liability, including federal income tax, NIIT, and California state tax, is roughly $340,000.

That's an $80,000 gap.

The Q2 vest hit in June. The Q3 vest will hit in September. If she keeps paying the same estimated tax she paid last year, she'll underpay by about $20,000 per quarter starting in Q2. The Q3 payment, due September 15, is where she can close the gap.

She doesn't need to pay the full $80,000 by September 15. She just needs to adjust her Q3 payment to reflect the higher income. If she switches from the safe harbor method to the annualized income installment method, she can pay based on what she's actually earned so far this year, which is already well above last year.

How to Adjust Your Q3 Payment

The fix has three steps.

Step 1: Look at year-to-date income. Add up your salary, bonus, and RSU income through Q2. Compare it to last year. If it's significantly higher because of a promotion, a large vest, or a stock price increase, your Q3 payment needs to go up.

Step 2: Choose your method. The safe harbor method (pay 110% of last year's total tax, split into four equal payments) is simple but keeps the gap open. The annualized income installment method calculates each payment based on your actual income through that quarter. More paperwork, but it matches your payments to the actual shape of your income.

Step 3: Recalculate and adjust. Use IRS Form 1040-ES to recalculate your Q3 payment. If you're on the annualized method, file Form 2210 Schedule AI with your return in April to show the IRS that your payments matched your income timing.

For a tech executive with lumpy RSU income, the annualized method is usually the right call. RSU grants vary with stock price and grant dates. Equal quarterly payments don't reflect reality.

Three steps to adjust Q3 estimated tax payment for RSU income

Why a Strategist Flags This Now

Your CPA files your return in March or April. They see the gap when it's too late to change anything. The return shows what happened, not what could have been different.

A tax strategist looks at this in July. The Q2 vest just posted. The Q3 payment is due in six weeks. There's time to adjust the estimated tax, sell shares to fund the gap, or restructure the year's plan.

That's the difference between compliance and strategy. Compliance answers the question "how much do I owe?" Strategy answers "how much will I owe, and what do we do about it before the deadline?"

Most firms do the first one. Roadmap Tax does the second.

If you're a tech executive in San Diego with seven figures of company stock and you're not sure your estimated tax payments are right for this year, that's exactly the kind of question a free 15-minute discovery call is meant for. Call us at (619) 280-2700 or email info@RoadmapTax.com.

FAQ

What is the supplemental withholding rate for RSUs?

The IRS requires a flat 22% withholding on RSUs as supplemental wages, up to $1 million. For amounts over $1 million, the rate rises to 37%. Most tech executives in California also have 10.23% state supplemental withholding.

Can I avoid the underpayment penalty if my estimated tax payments are based on last year's tax?

Yes, if you pay at least 110% of your previous year's total tax liability (for taxpayers with AGI over $150,000) through withholding and estimated payments. This is called safe harbor. It avoids the penalty but doesn't cover the gap between last year's tax and this year's tax.

When is the Q3 estimated tax payment due for RSU income?

The Q3 estimated tax payment is due September 15 of the current tax year. For RSU vesting that occurs in Q2 or Q3, this is the most important deadline for adjusting your payments to match your actual year-to-date income.

What is the annualized income installment method for estimated taxes?

The annualized income installment method calculates each quarterly estimated tax payment based on your actual income through that quarter, rather than dividing your total estimated liability into four equal payments. It's useful for taxpayers with uneven income, like RSU grants that vary by quarter.

Does California tax RSUs differently than the IRS for estimated tax purposes?

California treats RSUs as wages subject to state supplemental withholding at 10.23%. For estimated tax purposes, California has its own safe harbor rules and requires quarterly payments when your tax liability exceeds certain thresholds.

How do I know if I need a tax strategist instead of just a CPA?

If your April tax bill is consistently larger than you expected, if most of your net worth is in one company's stock, or if your RSU income pushes your total comp above $500,000 a year, a once-a-year filing CPA is probably not enough. A strategist works with you throughout the year to design outcomes, not just report them.

Your Q3 RSUs Vested. Fix Your Estimated Tax Before September 15.