The bill amends Section 44-30-2.6 of the General Laws in Chapter 44-30, which governs Rhode Island's personal income tax. It introduces a provision for investment tax credits, allowing eligible Sub-S corporation shareholders and limited liability company members of manufacturers to pass through investment tax credits issued under section 44-31-1(b) to their personal income tax returns. This provision is effective for tax year 2026 and thereafter, contingent on the shareholders and members meeting specific criteria based on their North American Industrial Classification System (NAICS) code and their payment of wages greater than the average annual wage paid to all manufacturing workers in Rhode Island within the same three-digit NAICS code.

The bill also modifies the Rhode Island earned-income credit, adjusting the percentage of the federal earned-income credit that taxpayers can claim, ultimately reaching a 16% credit for tax years beginning on or after January 1, 2024. Additionally, it ensures that the refundable portion of the earned-income credit will be 100% of the amount exceeding the Rhode Island income tax for tax years starting on or after January 1, 2015. Overall, the bill aims to enhance tax benefits for certain taxpayers while maintaining an equitable tax structure.

Statutes affected:
6009: 44-30-2.6