Bill > H5754

This bill increases the net taxable estate exemption in Rhode Island to four million dollars ($4,000,000) for deaths occurring on or after January 1, 2026. Currently, estate tax exemption amounts have varied over time, with previous thresholds ranging from $675,000 to $850,000. The bill maintains the existing method of calculating state estate taxes based on the maximum credit for state death taxes under federal law (26 U.S.C. § 2011), as it was in effect on January 1, 2001. Additionally, the bill includes a provision for annual adjustments to the Rhode Island credit amount starting January 1, 2027, which will be based on the Consumer Price Index for all Urban Consumers (CPI-U), with adjustments compounded annually and rounded up to the nearest five dollars. This change means that estates valued at less than $4 million will not be subject to Rhode Island estate tax, potentially providing significant tax relief for many families. The bill will take effect immediately upon its passage.

Budget and Finance

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