The bill amends Chapter 44-30 of the General Laws concerning "Personal Income Tax" by introducing a new section, 44-30-71.5, which allows for the voluntary withholding of state taxes from required minimum distributions from mutual fund individual retirement accounts (IRAs) for resident individuals. The tax administrator is authorized to enter into agreements with mutual fund companies to facilitate this withholding, which would be based on an estimated tax amount due from the distributions included in the resident's Rhode Island income for the calendar year. The method for determining the withholding amount will be established by the tax administrator's regulations, taking into account the resident's withholding exemptions.

Additionally, the provisions of this new section will only apply to residents who choose to opt for this withholding option. The act is designed to provide residents with a more manageable way to handle their tax obligations related to IRA distributions and will take effect immediately upon passage.