Registration Requirements in Rhode Island

You may be required to register your business with the Rhode Island Secretary of State. Some businesses may be required to re-register annually. More information can be found on their website below.

http://sos.ri.gov/

Certain businesses may also be required to file with the Rhode Island Department of Revenue. More information can be found on their website below. 

http://www.tax.state.ri.us/

S Corporation Tax

Rhode Island recognizes the federal S-election, and Rhode Island S corporations are not required to pay income tax to the state. However, individual S corporation shareholders will owe state tax on their share of the company’s income. S corporations are subject to a minimum fee of $400. S corporations file their return on Form RI-1120S, found below. 

http://www.tax.ri.gov/forms/2019/Corporate/2019%20RI-1120S_m.pdf

LLC/Partnership Tax

LLCs and partnerships are not required to pay income tax to Rhode Island. Instead, income from the business is distributed to individual LLC members or partners, who then pay Rhode Island income tax on that amount with their personal return. LLCs and partnerships are required to pay an annual fee of $400 to Rhode Island. Partnerships file on Form RI-1065, found.

http://www.tax.ri.gov/forms/2019/Corporate/2019%20RI-1065_m.pdf

Composite Tax

Rhode Island allows for pass through entities with qualified nonresident members to file a composite tax return on their behalf. In order for a qualified nonresident member to be included in the composite return, they must complete form RI-1040C-NE, found at the link below. 

http://www.tax.ri.gov/forms/2015/Composite/1040C-NE.pdf

Pass through entities file composite returns on Form RI-1040C, found at the link below. 

http://www.tax.ri.gov/forms/2019/Composite/2019%20RI-1040C_m.pdf

Individual Income Tax

Rhode Island generally conforms to the Internal Revenue Code on a rolling basis, and therefore it adopts most federal provisions, unless otherwise modified.

The starting point for computing Rhode Island's personal income tax liability is the federal adjusted gross income.

Rhode Island does allow their own state defined standard deduction. The amount of the standard deduction depends on filing status. The standard deduction ranges are as follows:

Single: $8,750
Married filing jointly or qualifying widow(er): $17,500
Head of household: $13,100
Married filing separately: $8,750

Itemized deductions are not offered but you are able to claim a personal deduction. The personal exemption amount for 2019 was $4,100.

Rhode Island does not conform to the IRC section 199A, also known as the QBI deduction.

Individuals with income assignable to Rhode Island may be required to file a Rhode Island individual Income tax return.

Income rates are as follows:

CARES Act Guidance

Rolling conformity states generally adopt changes to the IRC as they are enacted at the federal level, unless otherwise modified. Rhode Island specifically does not conform to the IRC Section 172 of the CARES Act regarding business net operating loss (NOL) provisions. Instead, Rhode Island will retain its treatment of business NOLs, not allowing any carryback and allowing only a 5-year carryforward.

Due Date

S corporation, partnership, and composite returns are due on or before the 15th day of the 3rd month following the close of the taxable year.

Individual income tax returns are due on the 15th day of the fourth month following the close of the tax year. 

If the date falls on a weekend or holiday, the due date is the following business day. 

Filing An Extension 

S corporations and partnerships can request a six month extension using form RI-7004: 

http://www.tax.ri.gov/forms/2018/Corporate/RI-7004_1D_m.pdf

Composite filers can request a six month extension using form RI-4868C:

http://www.tax.ri.gov/forms/2019/Composite/RI-4868C_m.pdf

Individuals can request a six month extension using form RI-4868: 

http://www.tax.ri.gov/forms/2019/Income/RI-4868_1D_m.pdf

Estimated Payments

Pass through entities should make estimated payments using form R_1040C-ES these payments are made at the highest income tax rate of 5.99%. 

http://www.tax.ri.gov/forms/2020/PT_C/2020%20RI-1040C-ES_m.pdf

Individuals who can reasonably expect to owe $250 or more in tax must make estimated payments using form RI-1040ES: 

http://www.tax.ri.gov/forms/2020/Income/2020%20RI-1040ES_1D_m.pdf

Penalties 

Rhode Island may impose a failure to file a timely return at a rate of 5% per month, up to a maximum of 25% of the tax due. 

Additional Information

If your business was formed or is located in another state, but generates income in Rhode Island, it may be subject to Rhode Island taxes. The rules for taxation of multistate businesses, including what constitutes nexus with a state for the purpose of various taxes, are complicated. If you run such a business, you should consult with a tax professional.

Rhode Island Department of Revenue: 

http://www.tax.ri.gov/

Rhode Island Secretary of State: 

http://sos.ri.gov/

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