§ 44-30-12 - Rhode Island income of a resident individual.
SECTION 44-30-12
§ 44-30-12 Rhode Island income of aresident individual. – (a) General. The Rhode Island income of a resident individual means hisor her adjusted gross income for federal income tax purposes, with themodifications specified in this section.
(b) Modifications increasing federal adjusted grossincome. There shall be added to federal adjusted gross income:
(1) Interest income on obligations of any state, or itspolitical subdivisions, other than Rhode Island or its political subdivisions;
(2) Interest or dividend income on obligations or securitiesof any authority, commission, or instrumentality of the United States, but notof Rhode Island or its political subdivisions, to the extent exempted by thelaws of the United States from federal income tax but not from state incometaxes;
(3) The modification described in § 44-30-25(g);
(4) The amount defined below of a nonqualified withdrawalmade from an account in the tuition savings program pursuant to §16-57-6.1. For purposes of this section, a nonqualified withdrawal is:
(A) A transfer or rollover to a qualified tuition programunder Section 529 of the Internal Revenue Code, 26 U.S.C. § 529, otherthan to the tuition savings program referred to in § 16-57-6.1; and
(B) A withdrawal or distribution which is:
(I) Not applied on a timely basis to pay "qualified highereducation expenses" as defined in § 16-57-3(12) of the beneficiary of theaccount from which the withdrawal is made;
(II) Not made for a reason referred to in §16-57-6.1(e); or
(III) Not made in other circumstances for which an exclusionfrom tax made applicable by Section 529 of the Internal Revenue Code, 26 U.S.C.§ 529, pertains if the transfer, rollover, withdrawal or distribution ismade within two (2) taxable years following the taxable year for which acontributions modification pursuant to subdivision (c)(4) of this section istaken based on contributions to any tuition savings program account by theperson who is the participant of the account at the time of the contribution,whether or not the person is the participant of the account at the time of thetransfer, rollover, withdrawal or distribution;
(ii) In the event of a nonqualified withdrawal undersubparagraphs (i)(A) or (i)(B) of this subdivision, there shall be added to thefederal adjusted gross income of that person for the taxable year of thewithdrawal an amount equal to the lesser of:
(A) The amount equal to the nonqualified withdrawal reducedby the sum of any administrative fee or penalty imposed under the tuitionsavings program in connection with the nonqualified withdrawal plus theearnings portion thereof, if any, includible in computing the person's federaladjusted gross income for the taxable year; and
(B) The amount of the person's contribution modificationpursuant to subdivision (c)(4) of this section for the person's taxable year ofthe withdrawal and the two (2) prior taxable years less the amount of anynonqualified withdrawal for the two (2) prior taxable years included incomputing the person's Rhode Island income by application of this subsectionfor those years. Any amount added to federal adjusted gross income pursuant tothis subdivision shall constitute Rhode Island income for residents,nonresidents and part-year residents; and
(5) The modification described in § 44-30-25.1(d)(3)(i).
(6) The amount equal to any unemployment compensationreceived but not included in federal adjusted gross income.
(7) The amount equal to the deduction allowed for sales taxpaid for a purchase of a qualified motor vehicle as defined by the InternalRevenue Code § 164(a)(6).
(c) Modifications reducing federal adjusted grossincome. There shall be subtracted from federal adjusted gross income:
(1) Any interest income on obligations of the United Statesand its possessions to the extent includible in gross income for federal incometax purposes, and any interest or dividend income on obligations, or securitiesof any authority, commission, or instrumentality of the United States to theextent includible in gross income for federal income tax purposes but exemptfrom state income taxes under the laws of the United States; provided, that theamount to be subtracted shall in any case be reduced by any interest onindebtedness incurred or continued to purchase or carry obligations orsecurities the income of which is exempt from Rhode Island personal income tax,to the extent the interest has been deducted in determining federal adjustedgross income or taxable income;
(2) A modification described in § 44-30-25(f) or §44-30-1.1(c)(1);
(3) The amount of any withdrawal or distribution from the"tuition savings program" referred to in § 16-57-6.1 which is included infederal adjusted gross income, other than a withdrawal or distribution orportion of a withdrawal or distribution that is a nonqualified withdrawal;
(4) Contributions made to an account under the tuitionsavings program, including the "contributions carryover" pursuant to paragraph(iv) of this subdivision, if any, subject to the following limitations,restrictions and qualifications:
(i) The aggregate subtraction pursuant to this subdivisionfor any taxable year of the taxpayer shall not exceed five hundred dollars($500) or one thousand dollars ($1,000) if a joint return;
(ii) The following shall not be considered contributions:
(A) Contributions made by any person to an account who is nota participant of the account at the time the contribution is made;
(B) Transfers or rollovers to an account from any othertuition savings program account or from any other "qualified tuition program"under section 529 of the Internal Revenue Code, 26 U.S.C. § 529; or
(C) A change of the beneficiary of the account;
(iii) The subtraction pursuant to this subdivision shall notreduce the taxpayer's federal adjusted gross income to less than zero (0);
(iv) The contributions carryover to a taxable year forpurpose of this subdivision is the excess, if any, of the total amount ofcontributions actually made by the taxpayer to the tuition savings program forall preceding taxable years for which this subsection is effective over the sumof:
(A) The total of the subtractions under this subdivisionallowable to the taxpayer for all such preceding taxable years; and
(B) That part of any remaining contribution carryover at theend of the taxable year which exceeds the amount of any nonqualifiedwithdrawals during the year and the prior two (2) taxable years not included inthe addition provided for in this subdivision for those years. Any such partshall be disregarded in computing the contributions carryover for anysubsequent taxable year;
(v) For any taxable year for which a contributions carryoveris applicable, the taxpayer shall include a computation of the carryover withthe taxpayer's Rhode Island personal income tax return for that year, and iffor any taxable year on which the carryover is based the taxpayer filed a jointRhode Island personal income tax return but filed a return on a basis otherthan jointly for a subsequent taxable year, the computation shall reflect howthe carryover is being allocated between the prior joint filers; and
(5) The modification described in § 44-30-25.1(d)(1).
(6) Amounts deemed taxable income to the taxpayer due topayment or provision of insurance benefits to a dependent, including a domesticpartner pursuant to chapter 12 of title 36 or other coverage plan.
(7) Modification for organ transplantation.(i) An individual may subtract up to ten thousand dollars ($10,000)from federal adjusted gross income if he or she, while living, donates one ormore of his or her human organs to another human being for human organtransplantation, except that for purposes of this subsection, "human organ"means all or part of a liver, pancreas, kidney, intestine, lung, or bonemarrow. A subtract modification that is claimed hereunder may be claimed in thetaxable year in which the human organ transplantation occurs.
(ii) An individual may claim that subtract modificationhereunder only once, and the subtract modification may be claimed for only thefollowing unreimbursed expenses that are incurred by the claimant and relatedto the claimant's organ donation:
(A) Travel expenses.
(B) Lodging expenses.
(C) Lost wages.
(iii) The subtract modification hereunder may not be claimedby a part-time resident or a nonresident of this state.
(d) Modification for Rhode Island fiduciaryadjustment. There shall be added to or subtracted from federal adjustedgross income (as the case may be) the taxpayer's share, as beneficiary of anestate or trust, of the Rhode Island fiduciary adjustment determined under§ 44-30-17.
(e) Partners. The amounts of modifications required tobe made under this section by a partner, which relate to items of income ordeduction of a partnership, shall be determined under § 44-30-15.