This bill makes several changes to the personal income tax laws in Rhode Island. It includes changes to the definition of "Rhode Island taxable income" and the rates of tax imposed on residents and nonresidents. The bill also includes provisions for alternative minimum tax, adjustments for inflation, maximum capital gains rates, and itemized deductions.

The bill proposes changes to the tax code, including setting the basic standard deduction for individual taxpayers and eliminating the standard deduction for certain individuals. It also includes adjustments for inflation, establishes an overall limitation on itemized deductions, and sets the exemption amount for taxpayers. The bill imposes an alternative minimum tax, a tax on certain types of income, and includes provisions for the treatment of unearned income of minor children. Finally, the bill imposes taxes on certain Rhode Island taxes, such as lump-sum distributions and the recapture of federal tax credits previously claimed on Rhode Island returns.

The bill also includes provisions for rounding down tax increases, allowing taxpayers to receive a credit against their Rhode Island tax for certain federal credits, and establishing a Rhode Island earned-income credit. It imposes a tax on Rhode Island taxable income over a certain threshold amount, with the revenue from this tax being used for specific purposes. The bill also makes changes to the standard deduction and exemption amounts based on adjusted gross income.

Statutes affected:
232: 44-30-2.6