The bill significantly alters how community service is recognized within the state's tax system. By enabling individuals to receive tax credits for their volunteer hours—up to $500 for single filers and $1,000 for joint filers—the legislation aims to encourage active participation in community service while providing financial relief to taxpayers. This could enhance local initiatives and foster a culture of volunteerism throughout Rhode Island.
Summary
House Bill 7172 is a proposed act addressing personal income tax regulations in Rhode Island. It seeks to amend existing tax law pertaining to the state's income tax provisions, primarily focusing on providing tax credits for state residents engaged in community service volunteerism. This modification aims to incentivize civic engagement and support local nonprofit entities by allowing individuals to claim income tax credits based on hours served in volunteer work.
Contention
While proponents of the bill argue that it promotes civic engagement and rewards altruistic behavior, critics may raise concerns about the implications for state revenue. The requirement for the Department of Administration to certify not-for-profit entities eligible to issue volunteerism credits could present additional bureaucratic challenges. Furthermore, questions may arise regarding the effectiveness and actual value of the credits in encouraging volunteerism compared to potential losses in tax revenues.
Implementation
If passed, the act would take immediate effect, requiring adequate measures to regulate and oversee the certification of nonprofit organizations and the tax credit process. Such aspects necessitate a well-structured administrative framework alongside clear guidelines to ensure that the benefits of the proposed credits reach intended constituents without causing administrative overload.
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.