Corporate Tax

Rhode Island Corporate Income tax is assessed at the rate of 7% of Rhode Island taxable income. To calculate the Rhode Island taxable income, the statute starts with Federal taxable income. You would have some additional state only deductions and additions, apply a single sales apportionment factor to arrive at your RI taxable income. All corporations with Rhode Island business activity are subject to a minimum tax. Rhode Island is also a combined reporting state using the Finnegan method for sales factor representation and market-based sourcing.

The corporate tax section also handles many miscellaneous income-based taxes such as a minimum tax for S-corporations, annual charges for various pass-through entities, as well as the taxation of banks, insurance companies, public service corporations and political organizations.

Apportionment

For tax years beginning on or after January 1, 2015, Sub Chapter C corporations are subject to a Single Sales Factor apportionment formula using market-based sourcing. In computing the gross receipts factor, the point of destination is used to determine receipts from sales of tangible personal property. One hundred percent of the receipts from these sales are attributed to Rhode Island when the property is located here and is shipped to points here; or when property is located outside Rhode Island and shipment is made to points in Rhode Island. Rhode Island statute also has a throw back provision for sales.

For pass through entities, the three (3) factor apportionment formula still applies. Entities with a regular place of business outside Rhode Island are entitled to apportion their net income. The apportionment factor for net income is computed by averaging:

the ratio of real and tangible property held or owned in Rhode Island to such property everywhere;
the ratio of salaries and wages paid in Rhode Island to salaries and wages everywhere; and
the ratio of gross receipts in Rhode Island to gross receipts everywhere.

For more details on apportionment rules, please review the apportionment regulation located on the secretary of state’s website: Welcome to the Rhode Island Code of Regulations - Rhode Island Department of State (ri.gov)

Registration

Tax Filing Requirements

How to File and Pay Taxes

Pass Through Entities

Combined Reporting

Forms

Please see the Corporate Tax Forms webpage for applicable forms.

Contact Us

Corporate Tax Section

Email: [email protected]

Phone: 401.574.8935

Fax: 401.574.8932