Earnout Tax Calculator
The single biggest variable in an earnout isn't the number — it's whether it's taxed as a capital gain or as ordinary income. The difference can be 20 points. Model both, with the 3.8% NIIT and your state, before you sign the deal.
How is it taxed?Stock-sale earnouts are usually capital gains; comp-style earnouts tied to employment are ordinary income. Ask your CPA.
Filing status
Estimated tax on this earnout$215,520≈ 21.6% effective · $784,480 net to you
Federal capital-gains tax$179,420
Net Investment Income Tax (3.8%)$36,100
Capital-gains treatment.Long-term rates (0/15/20%) plus the 3.8% NIIT — far below ordinary rates. The deal's structure decides whether you actually get this.
Track the real number over time
Velira keeps your vesting schedule, earnouts, and the tax you owe live — booked vs. contingent, never blended.
Estimate using published 2026 federal figures (Rev. Proc. 2025-32) — for education only, not tax advice. It omits AMT, phase-outs, credits, and state brackets. Velira does not file, transmit to the IRS, or move money. Confirm everything with your CPA.