The bill amends Section 44-30-12 of the Rhode Island General Laws to adjust the calculation of personal income tax for residents. It introduces new types of income that must be added to the federal adjusted gross income for state tax purposes, including interest from non-Rhode Island state obligations, certain dividends, and Paycheck Protection Program loan forgiveness over $250,000. It also specifies the tax treatment of nonqualified withdrawals from tuition savings programs. On the deductions side, the bill allows for the subtraction of interest income on U.S. obligations, certain tuition savings program withdrawals, contributions to such programs with limitations based on filing status, unreimbursed living organ donation expenses up to $10,000, insurance benefits for dependents, and taxable Social Security income. The bill also addresses carryover contributions to tuition savings programs and their allocation between joint filers.

Additionally, the bill modifies the taxable income from certain pensions and annuities. Starting with the tax year 2023 and including the tax year 2024, it allows a modification of up to $20,000 of such income. For tax years beginning on or after January 1, 2025, this modification cap increases to $50,000. The bill provides for the annual adjustment of these amounts for inflation, with increases rounded down to the nearest multiple of fifty or twenty-five dollars for married individuals filing separately. The act will take effect upon passage.

Statutes affected:
2960: 44-30-12