Equity Vesting Calculator 2026
Model your RSU or stock grant vesting schedule. See vested vs unvested shares, timeline chart, and 4-year projection. Supports cliff vesting, early termination, and acquisition acceleration.
Model your vesting schedule
Enter your grant details below — cliff, frequency, and optional early exit or acceleration scenarios.
Vesting summary
Vested to date
0
shares
Unvested
10,000
shares
Vesting timeline
Cumulative vested vs unvested shares over time· dashed line = cliff
4-year projection
Vesting milestones with progress
| Date | Vested | Unvested |
|---|---|---|
| Jul 2026 | 0 | 10,000 |
| Oct 2026 | 0 | 10,000 |
| Jan 2027 | 0 | 10,000 |
| Apr 2027 | 0 | 10,000 |
| Jul 2027 | 2,500 | 7,500 |
| Oct 2027 | 3,125 | 6,875 |
| Jan 2028 | 3,750 | 6,250 |
| Apr 2028 | 4,375 | 5,625 |
| Jul 2028 | 5,000 | 5,000 |
| Oct 2028 | 5,625 | 4,375 |
| Jan 2029 | 6,250 | 3,750 |
| Apr 2029 | 6,875 | 3,125 |
| Jul 2029 | 7,500 | 2,500 |
| Oct 2029 | 8,125 | 1,875 |
| Jan 2030 | 8,750 | 1,250 |
| Apr 2030 | 9,375 | 625 |
| Jul 2030 | 10,000 | 0 |
4 years · 1-year cliff · quarterly
25% at cliff, ~6.25% per quarter after
4 years · 1-year cliff · monthly
25% at cliff, ~2.08% per month after
4 years · 0 cliff · quarterly
~6.25% every quarter from day 1
4 years · 2-year cliff · quarterly
50% at cliff, ~6.25% per quarter after
Cliff
Period before any shares vest. Leave before cliff = 0 shares.
Grant date
When your equity was awarded — the clock starts here.
Vesting period
Total length until all shares are yours (typically 4 years).
Single trigger
100% of unvested shares vest on acquisition alone (no termination required).
Double trigger
Acquisition + involuntary termination both required to accelerate (100% vests).
PTEP
Post-termination exercise period. For ISOs: must exercise within 90 days to keep ISO treatment (IRC §422). NSO/RSU: set by grant agreement.
RSUs are taxed as ordinary income when they vest. FMV on vest date is added to your W-2.
Employers withhold shares (sell-to-cover) for federal income tax, state tax, and FICA.
Understanding equity vesting
A vesting cliff is a period (most commonly 1 year) during which no shares vest. At the cliff date, a lump sum vests — typically 25% for a 4-year grant — and then the remaining 75% vests periodically (monthly or quarterly) over the next 3 years.
If you leave before the cliff, you typically forfeit the entire grant. The cliff aligns incentives: it ensures you stay at least one year before receiving any equity.
Single trigger: 100% of unvested shares vest automatically on acquisition (change of control) alone — no termination required. Employee-friendly but can deter acquirers, so it is less common for rank-and-file employees.
Double trigger: 100% of unvested shares vest only when both a change of control AND involuntary termination (layoff) occur within a set period (often 18 months). More common at startups because acquirers prefer it. Check your grant agreement.
RSUs are company shares delivered to you at vest — no purchase required. You pay ordinary income tax on the FMV at vest.
Stock options (ISO or NSO) give you the right to buy shares at a strike price. ISOs can be tax-advantaged; NSOs are taxed as income on the spread at exercise. Options require active exercise; RSUs do not.
| Schedule type | Cliff | Frequency | At cliff | After cliff |
|---|---|---|---|---|
| Standard | 1 yr | Quarterly | 25% | ~6.25%/quarter |
| Monthly | 1 yr | Monthly | 25% | ~2.08%/month |
| No cliff | 0 | Quarterly | N/A | ~6.25%/quarter from day 1 |
| 2-year cliff | 2 yrs | Quarterly | 50% | ~6.25%/quarter |
Typical tech company RSU or stock grant schedule
| Period | Vested this period | Cumulative vested | Unvested remaining |
|---|---|---|---|
| Year 1 (pre-cliff) | 0 | 0 | 10,000 |
| At 1-year cliff | 2,500 | 2,500 | 7,500 |
| End of Year 2 | 2,500 | 5,000 | 5,000 |
| End of Year 3 | 2,500 | 7,500 | 2,500 |
| End of Year 4 | 2,500 | 10,000 | 0 |
Leave before 1-year cliff = 0 shares. Leave at 2.5 years = ~6,250 vested. Use the calculator above for your exact schedule.
| Factor | RSUs | ISOs | NSOs |
|---|---|---|---|
| Vesting | Typically 4yr, 1yr cliff | Typically 4yr, 1yr cliff | Typically 4yr, 1yr cliff |
| Tax at vest | Yes — ordinary income | No taxable event | No taxable event |
| Tax at exercise | N/A (already shares) | AMT preference item | Ordinary income on spread |
| Strike price | None required | Yes (≥ FMV at grant) | Yes (any price) |
| Suitable for | Public / late-stage | Early employees | Advisors, contractors |
This calculator models vesting schedules for all types. For RSU tax at vest, use our RSU Tax Calculator.
Who gets equity compensation?
Typically eligible
- Full-time employees at startups and public tech companies
- Engineers, product managers, designers, and data scientists
- Executives and senior leadership (larger grants)
- Advisors and board members (often smaller, shorter vesting)
- Early hires at pre-IPO startups
Usually not eligible
- Part-time and contract workers (check your offer letter)
- Hourly employees at non-tech companies
- Independent contractors (may get separate advisor grants)
- Employees at private companies with no equity plan
- Workers outside the US may have different local treatment
The ISO §422(d) $100,000 annual vesting limit and the 2026 AMT trap: how exercising ISOs can trigger a six-figure tax bill with no cash received
Source: IRC §422(d); Treas. Reg. §1.422-4; IRC §56(b)(3); Rev. Proc. 2025-32 (2026 AMT exemptions); OBBBA P.L. 119-21 §70107
Incentive Stock Options (ISOs) carry two lesser-known but critical limitations that interact with your vesting schedule. Missing either one can cost you tens of thousands of dollars in taxes you didn't expect to owe.
The §422(d) $100,000 annual ISO limit
Under IRC §422(d), only the first $100,000 of options (measured by FMV at grant date, not exercise date) that first become exercisable in any single calendar year can receive ISO tax treatment. Any excess is automatically reclassified as NSOs.
Example: the $300,000 grant problem
Grant: 20,000 ISOs at $15/share FMV at grant = $300,000 total. Under a 4-year schedule with a 1-year cliff where 25% ($75,000) first becomes exercisable at cliff: all within the $100k limit ✓ But if all 20,000 options first become exercisable at once in year 1 (annual vest), $300,000 first becomes exercisable in year 1 → $200,000 excess is automatically NSO → taxed as ordinary income at exercise on the spread.
This applies per employer and aggregates across the parent company and all subsidiaries. The reclassification is automatic — no form, no notice from the company.
The 2026 ISO AMT trap (IRC §56(b)(3))
Exercising ISOs and holding shares past December 31 of the exercise year triggers an AMT preference item equal to the bargain element (FMV at exercise − strike price × shares). No cash changes hands and no regular income tax applies — but AMT may apply.
| Filing status | 2026 AMT exemption | Phase-out begins |
|---|---|---|
| Single / HOH | $90,100 | $500,000 AMTI |
| Married filing jointly | $140,200 | $1,000,000 AMTI |
| Married filing separately | $70,100 | $500,000 AMTI |
Phase-out rate: 50 cents per dollar over the threshold (made permanent by OBBBA, P.L. 119-21, July 2025). AMT rates: 26% on lower AMTI; 28% on higher AMTI. Source: Rev. Proc. 2025-32; OBBBA §70107.
Key AMT strategies for ISO holders
- Exercise only up to the AMT 'crossover point' each year — the spread amount at which tentative minimum tax equals regular tax
- Same-year disqualifying disposition: sell by Dec 31 of exercise year → triggers ordinary income but eliminates AMT preference entirely
- Track Form 3921 (employer-issued after each ISO exercise) — essential for computing AMT and for the adjusted basis on future sale
- AMT credit (Form 8801): AMT paid in a prior year creates a credit usable against regular tax in future years when you sell the shares
The §83(b) election: the absolute 30-day deadline that can save founders millions — and why it does NOT apply to RSUs
Source: IRC §83(b)(2); Treas. Reg. §1.83-2(b); KPMG June 2025 Tax News Flash; Carta equity education; IRC §1202 (QSBS)
The §83(b) election is one of the most time-sensitive and consequential tax decisions in equity compensation — and one of the most frequently misunderstood. For the right instruments, it can save a successful founder or early employee millions of dollars in taxes. For RSU recipients, it is entirely irrelevant.
What the §83(b) election does
Under §83(a), restricted property (property transferred subject to a substantial risk of forfeiture, i.e., a vesting schedule) is taxed as ordinary income at each vest event — at the FMV minus amount paid on each vest date.
A timely §83(b) election flips the tax event to the date of transfer. You pay ordinary income tax now on the spread (FMV minus amount paid). For founders receiving restricted stock at near-zero FMV at company formation, this is often $0 in tax today — and then ALL future appreciation is taxed as capital gain (long-term if held 1+ year), not ordinary income.
Without §83(b) (default rule)
Each vest date = new ordinary income event at FMV on that date. For a startup that grows from $0.001/share to $10/share over 4 years, year-4 vests are taxed at $10/share at ordinary income rates — potentially millions at 37% + state with no cash to pay the bill.
§83(b) + QSBS §1202 interaction
For qualifying small businesses (QSBs), §1202 excludes up to $15 million (post-OBBBA) of gain from federal tax if you hold shares for 5+ years. The 5-year holding period starts at the date of property transfer — not at each vest. Filing §83(b) means the 5-year clock starts at grant, not vest. Without it, the clock restarts at each vest, potentially disqualifying later-vested shares from QSBS treatment entirely.
The 30-day deadline is absolute — no exceptions
The election must be filed with the IRS within 30 calendar days of the date the property is transferred. IRC §83(b)(2) provides no exception for reasonable cause, oversight, or any other reason. The IRS has no mechanism to accept a late §83(b) election.
- File as soon as possible after the grant — do not wait until day 29
- The 30-day window counts from the transfer date, including weekends and holidays (if day 30 falls on a weekend/holiday, the next business day applies)
- No IRS form number required — it is a written statement meeting Treas. Reg. §1.83-2(e) content requirements
- Keep a copy of the filed election AND proof of mailing (certified mail receipt, or e-filing confirmation if using a service)
What the §83(b) election applies to (and does NOT apply to)
RSUs are promises to deliver property, not a property transfer — §83(b) has no legal effect. Do not file it for RSUs.
No vesting schedule = not §83 property.
Equity dilution and the fully diluted cap table: why "10,000 shares" is meaningless without the denominator — and how option pool shuffles dilute employees before a round even closes
Source: SEC Regulation D; NVCA standard term sheet; FASB ASC 260 (Earnings Per Share)
A grant of "10,000 shares" has no meaning without knowing the total shares outstanding. Your real ownership percentage = your shares ÷ fully diluted shares. This denominator changes significantly with every funding round, option pool expansion, and warrant issuance — and the mechanics of how it changes matter enormously for the value of your grant.
What "fully diluted" includes
- All shares currently issued and outstanding (common + preferred)
- All options granted (both vested and unvested) across all grant agreements
- All shares reserved in the option pool but not yet granted
- All outstanding warrants (on an as-exercised basis)
- All convertible notes, SAFEs, and convertible preferred (on an as-converted basis)
Example: 10,000 shares at 10 million fully diluted = 0.10% ownership. At 100 million fully diluted = 0.01% ownership. Always ask: "What is the company's current fully diluted share count?"
Series A dilution example
Standard dilution per round at FAANG-founded startups: Series A ~20–25%; Series B ~15–20%; Series C+ ~10–15%. Multiple rounds compound: 1.0% pre-seed can become 0.3–0.5% by Series C even without any new employee grants.
The option pool shuffle: employees bear the dilution
A common VC term sheet requirement: before the Series A closes, the company must expand its option pool (e.g. from 10% to 15% of post-money fully diluted). This expansion happens in the pre-money cap table — meaning the new shares go into the denominator BEFORE the investor's money is counted, diluting only existing shareholders (founders and current employees), not the incoming investor.
Without the shuffle:
Investor buys 20% post-money. Founders own 80% of post-round cap table (before pool expansion).
With the pool shuffle (expand pool pre-money):
Option pool expansion adds shares to pre-money denominator. Founders now own 75–78% post-round. The 5% difference comes entirely from the founders (and existing employees), not the new investor.
Practical questions to ask before accepting a grant
- What is the company's current fully diluted share count?
- What percentage ownership does this grant represent on a fully diluted basis?
- What is the most recent 409A valuation (strike price for options should equal 409A FMV)?
- Has the company raised any recent funding, and what is the post-money ownership waterfall?
- What is the company's liquidation preference structure? (1x non-participating vs. participating preferred changes employee payout at exit)
The vested share counts, timeline events, and dollar projections above come from the grant details you enter—not a third-party feed. We build a linear vesting schedule with an optional cliff, apply dilution to effective shares, sum vests through your as-of date, and optionally estimate forfeiture or acceleration when you leave early. Below are the formulas, the order we follow, and worked examples you can check by hand.
Formulas
| Line | Formula |
|---|---|
| Effective shares (after dilution) | Effective = total shares × (1 − dilution % ÷ 100) |
| Cliff vest | Cliff shares = effective shares × (cliff months ÷ total vest months) |
| Shares per vest event (after cliff) | Per event = effective shares × (interval months ÷ total vest months) |
| Vested to date | Sum of sharesVested for all vest events on or before as-of date |
| Unvested shares | Effective shares − vested to date |
| Share price at a future date | Price = current share value × (1 + growth % ÷ 100)^(months from grant ÷ 12) |
| Vested / unvested dollar value | Shares × share price as of the as-of date (same price for both) |
| Forfeited on early leave | Effective shares − shares that would have vested by leave date |
| Single-trigger acceleration | floor(50% × unvested shares before acceleration) |
| Double-trigger acceleration | 100% of unvested shares before acceleration |
Order of operations
Apply dilution to the grant
Effective shares = grant size × (1 − dilution %)
If you enter a dilution percentage, we reduce the share count you vest against. This is a simplified model of ownership dilution—not a full cap-table simulation.
Schedule the cliff vest
First vest at grant date + cliff months
Nothing vests before the cliff. At the cliff date, a lump sum vests proportional to cliff length (e.g. 12 months of a 48-month grant = 25%).
Schedule periodic vests after the cliff
Equal shares each month, quarter, or year until fully vested
After the cliff, shares vest every interval until the vesting period ends. Each event vests total shares × (interval ÷ total months), capped so cumulative vested never exceeds effective shares.
Sum vested shares as of your date
Vested to date = sum of events with date ≤ as-of date
The calculator defaults to today. Vested and unvested dollar values both use the share price grown to the as-of date so the two figures are comparable.
Model early termination (optional)
Forfeited = effective − vested through leave month
When you enter a leave month, we estimate shares you would keep versus forfeit. You only receive shares from vest events on or before your leave date.
Estimate acceleration (optional)
Single: 50% of unvested · Double: 100% of unvested
Acceleration applies when you set a leave month and choose single- or double-trigger. Single trigger models 50% of remaining unvested accelerating; double trigger models 100%. Real grant agreements vary—check your equity plan.
Worked example
10,000 shares · 4-year vest · 1-year cliff · quarterly
Cliff at month 12: 10,000 × 12/48 = 2,500 shares
Each quarterly (3 months) event: 10,000 × 3/48 ≈ 625 shares
Vested to date (Jan 1, 2025): 2,500 shares · Unvested: 7,500
At $50/share: vested value $125,000 · unvested value $375,000
| Line item | Value |
|---|---|
| Total shares granted | 10,000 |
| Effective shares | 10,000 |
| Vested to date | 2,500 |
| Unvested shares | 7,500 |
| Vest events in timeline | 13 |
| Vested value | $125,000 |
| Unvested value | $375,000 |
At cliff (Standard grant: 10,000 shares at 1-year cliff (Jan 1, 2025)): 2,500 vested, $125,000 value at $50/share.
Early leave: Leave at 18 months: cliff + 2 quarters = 3,750 vested, 6,250 forfeited. Forfeited: 6,250 shares not yet vested at leave.
Acceleration: Single-trigger acceleration at 18 months: 3,125 of 6,250 unvested accelerates. Accelerated (50% of unvested): 3,125 shares.
Dilution: 10% dilution: 10,000 grant → 9,000 effective shares at full vest → 9,000 fully vested at end of schedule.
Constants we use
| Parameter | What we use |
|---|---|
| Default grant size | 10,000 shares |
| Default schedule | 4 years · 1-year cliff · quarterly |
| Cliff on 4-year grant | 25% at month 12 |
| Post-cliff quarterly (4-year, 1-yr cliff) | 625 shares per quarter |
| Projection table | Quarterly rows, up to 4 years |
| Tax at vest | Not modeled here |
What we do not model on this page
We model linear time-based vesting only—not performance milestones, refresh grants, partial vesting on termination for cause, company repurchase rights, ISO §422(d) $100k annual limits, AMT on option exercise, §83(b) elections, refresh grant stacking, or per-vest tax withholding. Acceleration percentages are illustrative (50% single / 100% double) and may not match your grant agreement. Dilution is a simple percentage haircut, not a round-by-round cap table. Share price growth is a constant annual rate, not volatility or 409A marks over time. For RSU tax at vest, use our RSU Tax Calculator.
Frequently asked questions
- IRS Topic 427: Stock Options
- IRS Pub 525: Taxable and Nontaxable Income (RSU/stock awards)
- SEC: Employee Stock Compensation
- Carta: Equity Education (vesting, cliffs, acceleration)
This calculator is for educational/planning purposes only and does not constitute tax or financial advice. Consult a financial advisor or tax professional for your specific situation. For RSU tax at vest, see our RSU Tax Calculator.
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