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, which 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. These additions are intended to increase the taxable income for Rhode Island residents in certain situations.

Conversely, the bill outlines subtractions from the federal adjusted gross income, such as interest on U.S. obligations, certain tuition savings program withdrawals, contributions to tuition savings programs (with limitations), and specific modifications for insurance benefits, organ donation expenses, and taxable Social Security income. The bill also introduces a phased approach to exclude Social Security income from taxable income, starting with a 25% subtraction in 2024 and increasing to 100% by 2027 for eligible individuals. Additionally, it provides for inflation adjustments using the year 2000 as a base tax year and sets rounding rules for calculated increases. The bill does not mention any deletions from current law and would take effect immediately upon passage, aiming to offer tax relief to individuals receiving Social Security income.

Statutes affected:
529: 44-30-12