RSU Vesting 4-Year 1-Year Cliff Calculator 2027
Calculate Restricted Stock Unit (RSU) vesting schedule 2027 — standard 4-year vest with 1-year cliff. See what vests when, tax implications, leaving-before-cliff impact.
Standard RSU Vesting Schedule
Most common: 4-year vest, 1-year cliff. 25% vests at 12-month mark (cliff), remaining 75% vests monthly/quarterly over years 2-4. Leave before cliff = lose 100%.
RSU Tax Treatment
Vesting event = taxable income at vest day price. Employer withholds shares (usually 22% federal default) to cover tax. Holding period for capital gains starts at vest, not grant.
RSU vs Stock Options
RSUs: free shares, taxable at vest. Options: right to BUY at strike price, taxable at exercise (ISO) or vest (NSO). RSUs simpler but less upside if stock falls below strike.
Refresh Grants
After initial 4-year grant, top employees get annual refreshes (e.g., 25-50% of original grant each year). Builds rolling vest schedule. Comp negotiation should include refresh size.
Source: levels.fyi compensation analysis, irs.gov Publication 525 RSU taxation. Last updated: May 2026.
Frequently Asked Questions
What if company acquired before cliff?
Depends on agreement. Some accelerate vesting (full vest). Some convert to new co's stock with same schedule. Some pay out cash. Critical clause: 'double-trigger acceleration' (acquisition + termination).
Can I sell at vest?
Yes (with restrictions). After tax withholding, remaining shares are yours to sell or hold. Blackout periods around earnings limit selling windows. 10b5-1 plans automate.
Should I hold or sell vested RSUs?
Diversify: most planners say sell at vest, redeploy across index funds. Holding company stock = double exposure (job + investment). 80% of vested RSU holders eventually wish they'd diversified.