The bill amends Section 44-30-12 of the General Laws in Chapter 44-30, which governs the personal income tax for resident individuals in Rhode Island. It introduces new legal language that defines "Rhode Island income of a resident individual" and outlines modifications to federal adjusted gross income. A key feature of the bill is the provision allowing individuals to subtract 20% of their Social Security income from their federal adjusted gross income for tax years beginning on or after January 1, 2027, with this percentage increasing incrementally to 100% by 2031. Specifically, the bill provides for the following phased increases: 20% for tax years beginning on or after January 1, 2027; 40% for tax years beginning on or after January 1, 2028; 60% for tax years beginning on or after January 1, 2029; 80% for tax years beginning on or after January 1, 2030; and 100% for tax years beginning on or after January 1, 2031. Additionally, the bill states that nothing in these subsections shall be construed to increase federal adjusted gross income for Social Security income that is otherwise exempt.

The bill also deletes certain criteria from current law, particularly those concerning age thresholds for Social Security retirement benefits and related income modifications. The act is set to take effect upon its passage.

Statutes affected:
7057: 44-30-12