Rhode Island State Income Tax

Rhode Island taxes individuals on their incomes and businesses on their sales of goods and services. The state also collects several types of excise taxes.

Like most states, Rhode Island tax rates are progressive. These rates are based on a taxpayer’s modified adjusted gross income (AGI), which incorporates net modifications and deductions. Rhode Island State Income Tax rates range from 3.75 percent to 5.99%. The state also has a 7 percent sales tax and no local sales taxes. In addition, the state has one of the highest property taxes in the country. The Division of Taxation recently issued an advisory providing relief for individuals and businesses affected by severe storms and flooding that began in September 2023. The advisory extends the due date for filing RI individual and business returns and payments through July 15.

The RI state income tax is based on federal adjusted gross income (AGI), with modifications, deductions and exemptions. These adjustments are made to arrive at Rhode Island’s taxable income, which is then compared with federal taxable income to determine the tax rate that applies. Unlike the federal income tax, the state does not have separate brackets for single filers and married couples filing jointly. It also does not have a personal exemption, but does allow a standard deduction and child or dependent exemptions.

How to Pay Rhode Island State Income Tax?

You can pay your state income tax in Rhode Island using the Department’s online payment portal. You can also make payments by phone. You can use this option whether you’ve already filed your taxes or not. A tax software solution can calculate your taxes based on several inputs and detect all possible deductions, which ensures that you pay the right amount of tax.

Rhode Island State Income Tax Exemption
Rhode Island State Income Tax 1

Rhode Island State Income Tax Exemption

The Rhode Island state income tax exemption is a percentage of your taxable income that the state subtracts from your total taxable income. This is different from a deduction, which reduces your taxable income by eliminating or reducing certain items on your tax return. The state income tax exemption is available to individuals, married couples filing jointly, or singles who are at least 18 years old. The state income tax exemption is also available to those who are 65 or older and have lived in Rhode Island for at least 10 years.

The state income tax exemption is applied after adjusting your modified adjusted gross income (MAGI). Your taxable income is calculated by adding or subtracting certain items on your tax return, including deductions and personal exemptions. The deduction and exemption amounts gradually decrease as your MAGI increases, until they are zero for taxpayers with a MAGI of $233,750 or higher.

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