Includes payment of social security benefits to the modification reducing federal adjusted gross income on personal income taxes.
Impact
The introduction of this bill could have a substantial impact on aspects of taxation in Rhode Island, particularly benefiting retirees who receive Social Security benefits. By modifying the state tax to account for these benefits, the bill aligns state tax obligations more closely with federal guidelines, potentially easing the financial burden on elderly residents. Additionally, the adjustments could influence tax equity among different income groups, as those receiving social security would find a more favorable tax treatment than under previous statutes prior to this amendment.
Summary
Bill S0409 concerns revisions to the existing personal income tax structure in Rhode Island. Specifically, it proposes amendments to Section 44-30-12 which defines Rhode Island income for resident individuals. The bill aims to enhance personal income tax regulations by including social security benefits as part of the income modifications allowable for tax purposes. This inclusion is significant as it allows taxpayers to reduce their taxable income, thereby potentially lowering their tax liabilities based on their adjusted gross income. The effects of this amendment would become effective starting January 1, 2025.
Contention
While supporters of the bill argue that it simplifies tax burdens on the elderly and promotes fairness in personal income taxation, opponents may raise concerns regarding the fiscal implications of such modifications. They might question whether the addition of social security as a tax modification will strain state revenues or complicate existing tax procedures. Overall, the debate surrounding S0409 may revolve around balancing fair tax relief for aging populations while ensuring that the state maintains sufficient revenue streams for its obligations.
Increases the federal adjusted gross income threshold for modification for taxable social security income. Amends references to federal adjusted gross income as pertains to modification of taxable retirement income from certain pension plans or annuities.
Phases in modifications to federal adjusted gross income over a 4 year period for social security income, from 25% up to 100%, beginning on or after January 1, 2025.
Allows a modification to federal adjusted gross income of twenty thousand dollars ($20,000) of social security income for tax years beginning on or after January 1, 2024.
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, 2025.
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.
Allows a modification up to $50,000 of taxable pension and/or annuity income includible in federal adjusted gross income for tax years beginning on or after January 1, 2025.
Allows a modification for all taxable pension and/or annuity income includible in federal adjusted gross income for tax years beginning on or after January 1, 2025.
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.
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.
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.
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.