Rhode Island House Bill H5393

Rhode Island 2023 Regular Session

• Introduced: 2/3/23
• Refer: 2/3/23

Caption

Personal Income Tax

Impact

The proposed changes would potentially decrease the overall tax burden for eligible residents by excluding social security income from the calculation of their taxable income. This act intends to enhance the fiscal well-being of taxpayers who rely heavily on their social security benefits, especially in a state where such forms of income can significantly influence living standards. While it aids many, the impact on state revenue while providing deductions warrants careful evaluation.

Summary

House Bill 5393 aims to amend the existing personal income tax statutes in Rhode Island, specifically targeting residents with total incomes of less than $100,000. The bill proposes allowing these individuals to deduct all social security income from their federal adjusted gross income starting from the tax year beginning on January 1, 2024. This modification is anticipated to benefit many low- to middle-income residents, facilitating greater financial relief for seniors and individuals reliant on social security benefits.

Contention

Discussions surrounding this bill may focus on the implications for state revenue, as allowing deductions could lead to less tax income for the state. Critics may raise concerns regarding the financial sustainability of such amendments, questioning the long-term viability of income structures reliant on taxation in supporting public services. Proponents, however, argue that the immediate financial relief for lower-income and elderly citizens outweighs potential fiscal drawbacks.