Quick answer
What is the difference between RSUs and restricted stock awards?
A restricted stock award gives you actual shares on day one that you forfeit if you do not vest. An RSU is a promise to deliver shares when you vest. RSAs can carry voting rights and dividends and allow an 83(b) election to be taxed at grant; RSUs are taxed at vest and cannot use 83(b).
Key takeaways
- 01RSA = shares now, forfeitable. RSU = shares later, at vest.
- 02An 83(b) election taxes an RSA at grant and starts your capital gains clock early.
- 03The 83(b) deadline is 30 days, with no extension.
- 04If you forfeit after an 83(b), you generally cannot deduct the tax you paid.
| RSA | Shares issued at grant, subject to forfeiture |
|---|---|
| RSU | Promise to deliver shares at vest |
| 83(b) available | RSA yes, RSU no |
| 83(b) deadline | 30 days after transfer |
| IRS form | Form 15620 (or a signed statement) |
| Common at | RSAs at early-stage startups; RSUs at public companies |
The Short Answer
What is the difference between RSUs and RSAs?
A restricted stock award (RSA) gives you actual shares on day one that you forfeit if you don't vest. An RSU is a promise to deliver shares when you vest. RSAs can come with voting rights and dividends and allow an 83(b) election to be taxed at grant; RSUs are taxed at vest and cannot use 83(b).
For RSU basics, see What Are Restricted Stock Units?. For options, see RSUs vs stock options.
| Feature | RSU | RSA |
|---|---|---|
| What you get at grant | A promise of future shares | Actual shares, subject to forfeiture |
| Voting rights | None until delivery | Usually yes from grant |
| Dividends | None, or dividend equivalents paid as wages | Usually paid (taxed as wages unless 83(b) made) |
| Tax event | Vest (ordinary income) | Vest, or grant if 83(b) filed |
| 83(b) available | No | Yes, within 30 days of grant |
| Typically used by | Public and late-stage companies | Early-stage startups and founders |
The 83(b) Election
How does the 83(b) election work?
Under IRC §83(b) you can elect to include the value of restricted stock in income at grant rather than at vest. You must file within 30 days of the transfer; the IRS has Form 15620 for this, and you give a copy to your employer. There are no extensions. If you paid fair value for the stock, as founders often do, the income is zero, and all later growth is capital gain with a holding period starting at grant.
Calculator
83(b) vs no election
Enter the value of the shares at grant and at vest, the eventual sale value, and your ordinary rate. Assumes long-term capital gains at 23.8% in both cases.
Total tax with 83(b)
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Total tax without 83(b)
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Saved by electing
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Illustrative only; not tax advice. Ignores payroll taxes, state tax and QSBS. If shares are forfeited, tax paid under 83(b) is not refunded.
Chart
Total federal tax on the default example
Forfeiture Risk
When does 83(b) backfire?
If you leave before vesting or the stock falls, you lose the shares and the tax you paid is not refunded. You can generally claim only a capital loss for any amount you actually paid for the shares. An 83(b) is a bet that the stock will rise and you will stay.
Chart
Cost of a wrong 83(b) bet
Missed the 30 days?: There is no late 83(b). Calendar the deadline from the grant date, send by certified mail and keep proof.
Shareholder Rights
Do you get voting rights and dividends?
RSA holders are usually shareholders of record from grant, so they can vote and typically receive dividends on unvested shares. Without an 83(b) election, those dividends are compensation and reported as wages; with an election, they are generally taxed as dividends.
RSU holders own nothing until shares are delivered. Many plans pay dividend equivalents, which are taxed as wages, and there are no voting rights before delivery.
"An RSA makes you an owner today with strings attached. An RSU makes you an owner later, if you are still there."
Where Embark fits
Vested shares, concentrated risk.
Enter your ticker and see what your equity could target in income without a sale.
- Works for vested RSU or RSA shares alike
- In-kind contribution under §721 means $0 tax at contribution
- Targets 10%+ annual income while you keep the upside
Run the numbers
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In Practice
When does each make sense?
RSA with 83(b)
Value is near zero, so electing costs almost nothing and starts the capital gains and QSBS clocks. See QSBS for founders.
RSA or options
RSAs still work while share value is low enough to pay tax upfront.
RSUs
Value is high, so employees can't afford tax at grant; RSUs avoid that and avoid issuing shares that might be forfeited.
Do
- File 83(b) within 30 days when grant value is low and you expect to stay
- Keep a copy of the election with your tax records
- Model the downside if you leave
Don't
- File 83(b) on a large grant value without modeling forfeiture
- Assume RSUs allow 83(b); they don't
- Forget that RSU dividend equivalents are wages
After Vest
What happens once you hold the shares?
Either way, vested shares have a cost basis, a holding period and, often, concentration. Taxes at vest for RSUs are covered in How Are RSUs Taxed?, and planning moves in RSU tax planning strategies.
Embark contributes concentrated stock into an SPV in exchange for partnership interests, an in-kind contribution that is generally a nonrecognition event under IRC §721, so $0 tax is due at contribution. The SPV targets 10%+ annual income while you keep exposure to the upside. Accredited investors only; targets are not guarantees.
FAQ
RSU vs RSA questions
Can I file an 83(b) for RSUs?
No. RSUs are not property transferred at grant, so §83(b) does not apply.
What is the 83(b) deadline?
30 days after the shares are transferred to you. There is no extension.
Do RSAs pay dividends?
Usually yes. Without an 83(b) election, dividends on unvested shares are taxed as wages; with one, they are generally dividends.
Are RSAs better than RSUs?
Not necessarily. RSAs with an 83(b) can save tax when value is low, but you take the forfeiture risk. RSUs are simpler at high valuations.
Does an 83(b) election help with QSBS?
Yes. Filing 83(b) on early restricted stock can start the QSBS holding period at grant rather than at vest.
What if my RSA is worth almost nothing at grant?
Then 83(b) costs little tax and can save a lot later, which is why founders and early employees usually file it.
How do I file an 83(b) election?
Mail Form 15620 or a signed statement to the IRS within 30 days and keep proof of mailing. Give a copy to your employer.
Sources
Primary sources
Sources
Cite this article
Embark Funds Research. “RSUs vs Restricted Stock Awards And When the 83(b) Election Matters.” Embark Funds, updated October 15, 2026. https://www.embarkfunds.com/insights/restricted-stock-units-vs-restricted-stock-awards
Not tax, legal or securities advice: This article is educational. Charitable, securities and tax rules depend on your facts and your company's policies. Work with a CPA, an estate attorney and, for insiders, securities counsel before acting. Embark income figures are targets, not guarantees, and contributed shares have a 3-year lock-up.
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