New York Supplemental Tax Regulations for Google (Alphabet) RSUs
New York State Department of Taxation and Finance applies statutory supplemental withholding. For New York City residents, combined state and local marginal rates can exceed 14.77%, causing a severe gap between statutory sell-to-cover and true combined liability.
New York Safe Harbor & Underpayment Penalties
Requires quarterly IT-2105 filings when tax withheld is over $300 below true tax.
Employer Stock Plan Specifics: Charles Schwab / Morgan Stanley
Google utilizes a frontloaded monthly vesting schedule (33% across years 1 and 2). Because monthly vests are treated as supplemental wage distributions, Schwab withholds federal tax at flat 22%. Googlers with total comp above $350k find that each monthly tranche underwithholds by 10% to 15%, compounding silently over 12 months.
When vesting at Google (Alphabet), Charles Schwab / Morgan Stanley calculates automatic sell-to-cover withholding using New York's statutory supplemental rate of 11.70% combined with the federal supplemental rate (22% on up to $1M). Because top earners in New York reach marginal brackets exceeding these rates, you will face an incremental shortfall on April 15.
Localized CPA & Advisory Referral
Advisor Guidance: Consult a New York Tri-State CPA specializing in NYS Form IT-2105 and NYC local tax equity withholding safe harbors.