The amendments proposed by S2268 would alter the existing state statutes concerning personal income tax calculations, specifically Sections 44-30-12. The bill states that taxpayers can also claim a rebate on their income for tax year 2023. This legislation, if enacted, provides a clearer pathway for individuals receiving specific types of state services, such as military pensions, to obtain financial relief, thereby potentially encouraging residency and permanent settlement in Rhode Island among veterans. Furthermore, the tax modifications may lead to an overall increase in disposable income for affected taxpayers.
Summary
Bill S2268, titled as 'An Act Relating to Taxation – Personal Income Tax - Residents', aims to amend the existing personal income tax laws in Rhode Island, specifically by introducing modifications to the calculation of income for tax purposes. A significant aspect of the bill is the ability for taxpayers receiving military service pensions to subtract the entirety of their military pension benefits from their federally adjusted gross income. This change is anticipated to benefit veterans and military personnel by reducing their overall tax burden, effectively recognizing their service through financial aid at the state level.
Sentiment
The overall sentiment surrounding Bill S2268 appears positive among supporters, particularly advocates for military personnel and veteran affairs. Proponents view the bill as a fair recognition of the sacrifices made by service members, allowing them to retain more of their earnings and thereby contributing positively to economic stability. However, concerns from opponents may include the impacts on state revenue and equitable treatment for all taxpayers, including non-military residents. While the sentiment leans towards benefiting veterans, there is also a cautious dialogue regarding the bill's implications on state funding.
Contention
Notable points of contention in the discussions around Bill S2268 include the fiscal impacts on state revenue generated through personal income taxes and the prioritization of military pensions over other forms of financial assistance to residents. Some legislators and stakeholders may argue that while supporting veterans is essential, it raises questions about equity for other demographic groups excluded from similar deductions. This debate could involve discussions on balancing veteran support with ensuring that the tax system remains fair and effective for all residents.
Gradually phases in modifications to federal adjusted gross income over a four (4) year period for social security income, from twenty-five percent (25%) up to one hundred percent (100%), beginning on or after January 1, 2026.
Establishes the first time home buyer savings program act. Allows modifications to federal adjusted gross income for $50,000 in contributions and $150,000 of interest and dividends included in federal adjusted gross income.
Establishes the first time home buyer savings program act. Allows modifications to federal adjusted gross income for $50,000 in contributions and $150,000 of interest and dividends included in federal adjusted gross income.
Phases in modifications to federal adjusted gross income over a four (4) year period for social security income, from twenty percent (20%) up to eighty percent (80%), beginning on or after January 1, 2026.