Rhode Island Senate Bill S2366

Rhode Island 2026 Regular Session

• Introduced: 1/29/26
• Introduced: 1/30/26
• Refer: 1/29/26
• Refer: 1/30/26

Caption

RELATING TO TAXATION -- PERSONAL INCOME TAX

Summary

S2366 amends Rhode Island’s personal income tax law to create a new subtraction from federal adjusted gross income for Social Security benefits. Beginning with tax years on or after January 1, 2026, an individual taxpayer may subtract up to $25,000 of Social Security income from Rhode Island taxable income. The bill is framed as a modification to the state’s existing income tax calculation, which already includes a series of additions and subtractions for items such as retirement income, tuition savings program contributions, organ donation expenses, military pensions, and other specified income items. The bill’s primary effect is to reduce state income tax liability for taxpayers receiving Social Security benefits, especially retirees and other older residents whose benefits are taxable at the federal level. Because the change is made through the state’s definition of Rhode Island income, it directly alters the tax base used to compute personal income tax and would apply to resident taxpayers under Chapter 44-30. The bill takes effect upon passage, but the Social Security subtraction applies only to tax years beginning on or after January 1, 2026.

Impact

This bill would amend § 44-30-12 of the Rhode Island General Laws, which defines Rhode Island income for resident individuals and lists the statutory additions and subtractions from federal adjusted gross income. The new provision would allow a $25,000 subtraction for Social Security income beginning in tax year 2026, thereby lowering taxable income for eligible filers and reducing state revenue to the extent taxpayers claim the deduction. It does not create a new credit or refund program; instead, it changes the income tax base used for calculating liability under existing law.

Sentiment

The bill text and caption indicate a generally favorable policy direction toward tax relief for retirees and Social Security recipients. No committee transcript or vote record was provided, so there is no documented debate or recorded opposition in the supplied materials. Based on the structure of the bill, the apparent intent is to provide targeted relief to older taxpayers and align Rhode Island’s tax treatment of Social Security income with a more generous state subtraction.

Contention

No specific contention is documented in the provided materials, but the likely policy issue is the fiscal tradeoff between tax relief for Social Security recipients and the resulting reduction in state revenue. Any debate would likely center on whether the $25,000 subtraction is appropriately targeted, how it interacts with existing retirement-income exclusions, and whether the benefit should be limited by income level or filing status. Because no hearings, amendments, or votes are included, there is no direct evidence of organized support or opposition in the record provided.