Is vest the same as grant?

No. Grant is the award on paper (often a four-year schedule). Vest is each date a tranche is delivered. Cliff vests (for example 25% at 12 months) are the days that surprise people.

If I don’t sell, do I still owe tax?

Yes. Vest is income whether you sell or hold. Sell-to-cover only funds withholding. If 22% is below your bracket, holding the shares does not defer the rest of the ordinary tax.

What is a vest

What vesting means on RSUs — and why tax hits that day.

Reviewed August 21, 2026. About. Not tax advice.

A vest is the date previously granted Restricted Stock Units stop being a promise and become shares (or cash) you actually own. US tax treats the fair market value of those shares on the vest date as ordinary wage income, the same bucket as salary. Your company usually sells a slice to cover tax — often 22% federal because of the supplemental-wage rule — and deposits the rest in your brokerage. Grant day is not the tax day. Sale day is a later capital-gain day, with basis generally equal to the vest-date value already taxed.

The three dates

Grant: you receive a schedule. Vest: FMV × shares is W-2 wages. Sale: gain or loss vs that FMV is capital, usually reported on 1099-B. Mixing those three dates is how people double-count basis.

FAQ

Is vest the same as grant?: No. Grant is the award on paper (often a four-year schedule). Vest is each date a tranche is delivered. Cliff vests (for example 25% at 12 months) are the days that surprise people.
If I don’t sell, do I still owe tax?: Yes. Vest is income whether you sell or hold. Sell-to-cover only funds withholding. If 22% is below your bracket, holding the shares does not defer the rest of the ordinary tax.

Sources

IRS Publication 15 (Circular E) — Supplemental wage withholding: 22% up to $1 million, 37% above.
IRS tax year 2026 inflation adjustments (Rev. Proc. 2025-32) — 2026 federal brackets and standard deduction.
IRS estimated taxes — 1040-ES installment dates and underpayment penalty.

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