The bill amends Section 44-30-12 of the Rhode Island General Laws, focusing on personal income tax for residents. It introduces changes to the calculation of Rhode Island income by adding certain types of income back into the federal adjusted gross income, such as nonqualified withdrawals from tuition savings programs and forgiven Paycheck Protection Program loans exceeding $250,000. Conversely, it allows for subtractions from federal adjusted gross income, including interest income on U.S. obligations, contributions to tuition savings programs (with limitations), and up to $10,000 for unreimbursed organ donation expenses. The bill also removes the deduction for sales tax paid on the purchase of a qualified motor vehicle.

Additionally, the bill proposes a phased increase in deductions for social security income from federal adjusted gross income starting in 2025, with a 20% deduction that gradually increases to 80% by 2028. It includes provisions for inflation adjustments based on the year 2000, with any increase not a multiple of $50 ($25 for married individuals filing separately) to be rounded down to the next lower multiple. The act is intended to take effect immediately upon passage, indicating that the changes will be implemented as soon as the bill is enacted into law.

Statutes affected:
7588: 44-30-12