The bill amends Section 44-30-12 of the General Laws in Chapter 44-30, titled "Personal Income Tax," to adjust the definition of Rhode Island income for resident individuals. It specifies additions to the federal adjusted gross income, such as interest from non-Rhode Island state obligations, certain dividends, nonqualified withdrawals from tuition savings programs, unemployment compensation not included in federal income, and amounts over $250,000 from forgiven Paycheck Protection Program loans. Conversely, it outlines subtractions from the federal adjusted gross income, including interest on U.S. obligations, certain tuition savings withdrawals, contributions to tuition savings programs (with limitations), and specific modifications for insurance benefits, organ donation expenses, and taxable Social Security income. The bill introduces a carryover for excess tuition savings contributions and a one-time subtraction for unreimbursed organ donation expenses, with restrictions for part-time residents and nonresidents.

Furthermore, the bill allows individuals earning less than $100,000 to deduct all social security income from their federal adjusted gross income for tax years starting on or after January 1, 2024. It also provides for the adjustment of income thresholds for inflation based on the year 2000, with rounding rules for increases not in multiples of $50, or $25 for married individuals filing separately. The bill is set to take effect immediately upon passage, indicating that the changes will be implemented as soon as the bill becomes law.

Statutes affected:
5393: 44-30-12