Tax deduction on RSU after internal transfer

Amazon Tewb30
Apr 2 3 Comments

Took an internal transfer from Texas to California. RSUs vested 5 days after starting work in California.
They deducted California state tax (~10%) from the total vested amount. I feel this is unfair.
Has anyone had a similar issue before?

Found this equation on Quora:

Allocation ratio = California workdays from purchase date to vesting date / Total workdays from purchase date to vesting date

Income taxable by CA = Total income from RSU x Allocation ratio.

Appreciate your help in advance!

Thanks

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  • Nvidia mappp
    Are you talking about withholding done by your company payroll? If so it doesn’t matter, you will get the difference back when filing your taxes.
    Apr 2 2
    • Amazon Tewb30
      OP
      RSUs are generally operated through a brokerage account. In my case the CA state tax was withheld by the broker
      Apr 2
    • Nvidia mappp
      Withholding can be controlled through employer for RSU. In any case, if you overpaid, you will still get it back when you file taxes.
      Apr 2