The bill seeks to amend Section 44-30-12 of the General Laws in Chapter 44-30, which pertains to "Personal Income Tax" in Rhode Island. It proposes changes to the definition of Rhode Island income for resident individuals by specifying additions and subtractions to the federal adjusted gross income for state income tax calculations. Additions include 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. Subtractions include interest on U.S. obligations, certain tuition savings withdrawals, contributions to tuition savings programs (with limitations), and specific modifications for insurance benefits for dependents, organ donation expenses, and taxable Social Security income. The bill also introduces a carryover for excess contributions to tuition savings programs and a one-time subtraction for unreimbursed organ donation expenses.

Furthermore, the bill proposes an increase in the modification of taxable pension and annuity income for tax years beginning on or after January 1, 2024. The modification amount would be up to $50,000, an increase from the previous amounts of $15,000 and $20,000 for earlier tax years. This applies to individuals who have reached the age for full Social Security retirement benefits and meet certain income criteria. The bill also includes a provision for annual adjustment of these amounts for inflation, with increases rounded down to the nearest multiple of $50 or $25 for married individuals filing separately. The act would take effect upon passage, allowing eligible taxpayers to benefit from the increased modification starting in the 2024 tax year.

Statutes affected:
5624: 44-30-12