The bill amends Section 44-22-1.1 of the General Laws concerning estate and transfer taxes, specifically addressing the tax on the net estate of decedents. It introduces a new provision that imposes a tax on the transfer of the net estate for decedents whose death occurs on or after January 1, 2026, applicable only if the net taxable estate exceeds four million dollars ($4,000,000). The tax will be calculated based on the maximum credit for state death taxes allowed by 26 U.S.C. 2011, as it was in effect as of January 1, 2001. A Rhode Island credit will be allowed against any tax determined, and this credit amount will be adjusted annually based on the percentage increase in the Consumer Price Index for all Urban Consumers (CPI-U), starting January 1, 2027, with adjustments compounded annually and rounded up to the nearest five dollar ($5.00) increment.

The bill also clarifies that any scheduled increases in the unified credit provided in 26 U.S.C. 2010 will not apply. The act is set to take effect upon passage, thereby updating the estate tax framework in Rhode Island to reflect the new exemption threshold.

Statutes affected:
5783: 44-22-1.1