Federal and CA Taxation on RSU vested due to IPO after leaving US

mohitbansal
mohitbansal Member Posts: 2 Newcomer
in Situation & Life Changes

Hello community,

 

I worked for a startup in US for 2 years from beg of 2021 to end of 2022. I was awarded some rsu from the company. I left US in beginning of 2023. 

Company is IPOed in mid 2025, so these rsu are finally vested now. Company will give me W2 this year and they have withholded all the federal and CA taxes based on these rsu. i do not have any other income from US this year apart from these RSUs.

1. How do i need to report this on 1040NR and 540NR?

 

2. Will i be taxed on full amount or I've to only pay for, on fraction of amount? As in for 2 years i was in US. And 2.5 years i'm out of US at vesting date. Probably 2/4.5 of total amount. If i can do that how will this be reported for both federal and CA?

 

3. Or is it fully exempt and i can claim full refund (which i don't think its possible, but still just in case)

 

Any help and guidance will really help me plan it forward. Thanks in advance.

Tagged:

Comments

  • mohitbansal
    mohitbansal Member Posts: 2 Newcomer

    [Little update for more clarity]


    I worked for a startup in US for 2 years from beg of 2021 to end of 2022. I was awarded some rsu from the company and those got time vested while i was employed there, since company was private no tax was withheld in this timeframe. I left US in beginning of 2023 and left the company also. 

    Company is IPOed in mid 2025, so these rsu are finally liquid now. Because of going public, these all getting taxed on 2025. Company will give me W2 this year and they have withholded all the federal and CA taxes based on these rsu. I do not have any other income from US this year apart from these RSUs.

  • MatthewD
    MatthewD FreeTaxUSA Team Posts: 688 image
    Hi mohitbansal,

    Keep in mind that you will be taxed on your US source income on a US nonresident return. When you have an RSU, some may be reported as ordinary income on a W-2 and some may be reported as a capital gain on Schedule D.

    Unfortunately, FreeTaxUSA does not support filing a Form 1040NR, so you will need to use another tax service to prepare that return.

Categories