If you are a resident of Rhode Island then you are required to file a state income tax return. If you are a non-resident who accumulated income from a source within Rhode Island then you are also required to file a state income tax return to report your earnings. Any part-year residents who are required to file a federal tax return are also required to file a state return.
They implement both a sales and income tax and the income tax rate brackets look like this:
$0 – $55,000 – 3.75%
$55,000 – $125,000 – 4.75%
$125,000+ – 5.99%
Those same exact amounts and rates apply to those who are married filing jointly as well. How’s that for simple? Rhode Island implements a sales tax of 7% on most goods besides food, some clothing, precious metal bullion, some burial-related items, and prescription and non-prescription drugs. The number of personal exemptions you can take is described as being the number of your federal exemptions multiplied by $3,500. So basically each exemption counts for $3,500. You can take a standard deduction for the same amount as the federal standard deduction but if you’re 65 or older then you can take a $7,500 deduction as a single tax payer and $15,000 as someone married and filing jointly.
The ocean state’s gasoline excise tax is a fairly significant 33 cents per gallon which is the same rate for diesel fuel as well. They also implement one of the most massive cigarette excise taxes at $3.46 a pack! Instead of being levied by the state, property taxes in Rhode Island are levied by town and city jurisdictions. While there is no inheritance tax, Rhode Island does put a tax on the net value of the transfer of every residents assets to a resident decedent. There is also an estate tax with an exemption of $892,650.
Like the other states and the federal government, they encourage you to try e-filing your state income tax return this year. It saves people on both ends of the process time and money while it also reduces the amount of paper that we would otherwise needlessly waste!