Glossary

Short definitions for common RSU tax terms.

Key terms

RSU: Restricted stock units granted by an employer and delivered as shares upon vesting.
Vesting: The moment RSUs convert into actual shares, triggering income tax.
Cost basis: The share value at vesting, used to calculate capital gains.
Capital gain: Sale price minus cost basis, taxed as capital gains in qualifying Section 102 plans.
Withholding: Tax withheld by the employer or trustee at vesting or sale.
Trustee: Approved entity that holds shares during the Section 102 holding period.