How do double-trigger RSUs at a private company get taxed?

At many pre-IPO companies, RSUs have a double trigger: they vest only when both a time-based schedule is met and a liquidity event (IPO or acquisition) occurs. Because you can't sell shares in a private company, the second trigger prevents you from owing tax on illiquid stock. When the liquidity event hits, all your time-vested RSUs settle at once, and the entire value is reported as ordinary W-2 income in that year – often a huge spike that can push you into the top bracket. Employer withholding at 22% will badly undershoot, leaving a large bill. Plan ahead for the IPO year: set aside cash for the bracket gap, consider estimated payments, and don't assume the withheld shares cover everything. The tax hits whether or not you sell.