When RSUs vest the value of all the units vesting becomes ordinary income. Employers are required to withhold payroll taxes (social security and Medicare) and income taxes. To pay the taxes, untis can either be sold, or withheld by the employer. When units/shares are sold, there is a sales transaction that needs to be reported and a possible gain or loss. When units are withheld by the employer, there is no sales transaction to report. The value of all the shares that vested is included in Box 1 of the employees W-2, and the taxes paid by the employer is added to the corresponding tax withholding boxes. If your employer did not include the tax withholding on your W-2, they should issue you a corrected W-2. If they included the income but did not include the withholding, it would result in your tax return showing that you owed additional social security and medicare tax.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
