2024 -- S 2065 | |
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LC003721 | |
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STATE OF RHODE ISLAND | |
IN GENERAL ASSEMBLY | |
JANUARY SESSION, A.D. 2024 | |
____________ | |
A N A C T | |
RELATING TO TAXATION -- ESTATE AND TRANSFER TAXES--LIABILITY AND | |
COMPUTATION | |
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Introduced By: Senators Paolino, Rogers, E Morgan, DeLuca, de la Cruz, F. Lombardi, | |
Date Introduced: January 12, 2024 | |
Referred To: Senate Finance | |
It is enacted by the General Assembly as follows: | |
1 | SECTION 1. Section 44-22-1.1 of the General Laws in Chapter 44-22 entitled "Estate and |
2 | Transfer Taxes — Liability and Computation" is hereby amended to read as follows: |
3 | 44-22-1.1. Tax on net estate of decedent. |
4 | (a)(1) For decedents whose death occurs on or after January 1, 1992, but prior to January |
5 | 1, 2002, a tax is imposed upon the transfer of the net estate of every resident or nonresident decedent |
6 | as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for state death |
7 | taxes allowed by 26 U.S.C. § 2011. |
8 | (2) For decedents whose death occurs on or after January 1, 2002, but prior to January 1, |
9 | 2010, a tax is imposed upon the transfer of the net estate of every resident or nonresident decedent |
10 | as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for state death |
11 | taxes allowed by 26 U.S.C. § 2011 as it was in effect as of January 1, 2001; provided, however, |
12 | that the tax shall be imposed only if the net taxable estate shall exceed six hundred seventy-five |
13 | thousand dollars ($675,000). Any scheduled increase in the unified credit provided in 26 U.S.C. § |
14 | 2010 in effect on January 1, 2001, or thereafter, shall not apply. |
15 | (3) For decedents whose death occurs on or after January 1, 2010, and prior to January 1, |
16 | 2015, a tax is imposed upon the transfer of the net estate of every resident or nonresident decedent |
17 | as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for state death |
18 | taxes allowed by 26 U.S.C. § 2011 as it was in effect as of January 1, 2001; provided, however, |
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1 | that the tax shall be imposed only if the net taxable estate shall exceed eight hundred and fifty |
2 | thousand dollars ($850,000); provided, further, beginning on January 1, 2011, and each January 1 |
3 | thereafter until January 1, 2015, said amount shall be adjusted by the percentage of increase in the |
4 | Consumer Price Index for all Urban Consumers (CPI-U) as published by the United States |
5 | Department of Labor Statistics determined as of September 30 of the prior calendar year; said |
6 | adjustment shall be compounded annually and shall be rounded up to the nearest five dollar ($5.00) |
7 | increment. Any scheduled increase in the unified credit provided in 26 U.S.C. § 2010 in effect on |
8 | January 1, 2003, or thereafter, shall not apply. |
9 | (4) For decedents whose death occurs on or after January 1, 2015, a tax is imposed upon |
10 | the transfer of the net estate of every resident or nonresident decedent as a tax upon the right to |
11 | transfer. The tax is a sum equal to the maximum credit for state death taxes allowed by 26 U.S.C. |
12 | § 2011, as it was in effect as of January 1, 2001; provided, however, that a Rhode Island credit shall |
13 | be allowed against any tax so determined in the amount of sixty-four thousand four hundred |
14 | ($64,400). Any scheduled increase in the unified credit provided in 26 U.S.C. § 2010 in effect on |
15 | January 1, 2003, or thereafter, shall not apply; provided, further, beginning on January 1, 2016, and |
16 | each January 1 thereafter, said Rhode Island credit amount under this section shall be adjusted by |
17 | the percentage of increase in the Consumer Price Index for all Urban Consumers (CPI-U) as |
18 | published by the United States Department of Labor Statistics determined as of September 30 of |
19 | the prior calendar year; said adjustment shall be compounded annually and shall be rounded up to |
20 | the nearest five dollar ($5.00) increment. |
21 | (5) For decedents whose death occurs on or after January 1, 2025, a tax is imposed upon |
22 | the transfer of the net estate of every resident or nonresident decedent as a tax upon the right to |
23 | transfer. The tax shall be imposed only if the net taxable estate shall exceed three million six |
24 | hundred thousand dollars ($3,600,000); provided, further, beginning on January 1, 2026, and each |
25 | January 1, thereafter, said amount shall be increased by one million dollars ($1,000,000). |
26 | (b) If the decedent’s estate contains property having a tax situs not within the state, then |
27 | the tax determined by this section is reduced to an amount determined by multiplying the tax by a |
28 | fraction whose numerator is the gross estate excluding all property having a tax situs not within the |
29 | state at the decedent’s death and whose denominator is the gross estate. In determining the fraction, |
30 | no deductions are considered and the gross estate is not reduced by a mortgage or other |
31 | indebtedness for which the decedent’s estate is not liable. |
32 | (c)(1) The terms “gross taxable estate,” “federal gross estate” or “net taxable estate” used |
33 | in this chapter or chapter 23 of this title has the same meaning as when used in a comparable context |
34 | in the laws of the United States, unless a different meaning is clearly required by the provisions of |
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1 | this chapter or chapter 23 of this title. Any reference in this chapter or chapter 23 of this title to the |
2 | Internal Revenue Code or other laws of the United States means the Internal Revenue Code of |
3 | 1954, 26 U.S.C. § 1 et seq. |
4 | (2) For decedents whose death occurs on or after January 1, 2002, the terms “gross taxable |
5 | estate” “federal gross estate” or “net taxable estate” used in this chapter or chapter 23 of this title |
6 | has the same meaning as when used in a comparable context in the laws of the United States, unless |
7 | a different meaning is clearly required by the provisions of this chapter or chapter 23 of this title. |
8 | Any reference in this chapter or chapter 23 of this title to the Internal Revenue Code or other laws |
9 | of the United States means the Internal Revenue Code of 1954, 26 U.S.C. § 1 et seq., as they were |
10 | in effect as of January 1, 2001, unless otherwise provided. |
11 | (d) All values are as finally determined for federal estate tax purposes. |
12 | (e) Property has a tax situs within the state of Rhode Island: |
13 | (1) If it is real estate or tangible personal property and has actual situs within the state of |
14 | Rhode Island; or |
15 | (2) If it is intangible personal property and the decedent was a resident. |
16 | SECTION 2. This act shall take effect upon passage. |
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EXPLANATION | |
BY THE LEGISLATIVE COUNCIL | |
OF | |
A N A C T | |
RELATING TO TAXATION -- ESTATE AND TRANSFER TAXES--LIABILITY AND | |
COMPUTATION | |
*** | |
1 | This act would increase the net taxable estate exemption to three million six hundred |
2 | thousand dollars ($3,600,000) on January 1, 2025. This act would also increase the exemption by |
3 | one million dollars ($1,000,000) on January 1 per year thereafter. |
4 | This act would take effect upon passage. |
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