2012 -- H 7491

=======

LC01117

=======

STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

____________

A N A C T

RELATING TO TAXATION - ESTATE AND TRANSFER TAXES - LIABILITY AND

COMPUTATION

     

     

     Introduced By: Representatives Ruggiero, Trillo, Gallison, Silva, and Naughton

     Date Introduced: February 09, 2012

     Referred To: House Finance

It is enacted by the General Assembly as follows:

1-1

     SECTION 1. Section 44-22-1.1 of the General Laws in Chapter 44-22 entitled "Estate

1-2

and Transfer Taxes - Liability and Computation" is hereby amended to read as follows:

1-3

     44-22-1.1. Tax on net estate of decedent. -- (a) (1) For decedents whose death occurs on

1-4

or after January 1, 1992, but prior to January 1, 2002, a tax is imposed upon the transfer of the net

1-5

estate of every resident or nonresident decedent as a tax upon the right to transfer. The tax is a

1-6

sum equal to the maximum credit for state death taxes allowed by 26 U.S.C. section 2011.

1-7

      (2) For decedents whose death occurs on or after January 1, 2002, but prior to January 1,

1-8

2010 2013 a tax is imposed upon the transfer of the net estate of every resident or nonresident

1-9

decedent as a tax upon the right to transfer. The tax is a sum equal to the maximum credit for

1-10

state death taxes allowed by 26 U.S.C. section 2011 as it was in effect as of January 1, 2001;

1-11

provided, however, that the tax shall be imposed only if the net taxable estate shall exceed six

1-12

hundred seventy-five thousand dollars ($675,000). Any scheduled increase in the unified credit

1-13

provided in 26 U.S.C. section 2010 in effect on January 1, 2001, or thereafter, shall not apply.

1-14

      (3) For decedents whose death occurs on or after January 1, 2010 December 31, 2012, a

1-15

tax is imposed upon the transfer of the net estate of every resident or nonresident decedent as a

1-16

tax upon the right to transfer. The tax is a sum equal to the maximum credit for state death taxes

1-17

allowed by 26 U.S.C. section 2011 as it was in effect as of January 1, 2001; provided, however,

1-18

that the tax shall be imposed only if the net taxable estate shall exceed eight hundred and fifty

1-19

thousand dollars ($850,000); that a credit shall be allowed against any tax so determined in the

2-1

amount of thirty-three thousand two hundred dollars ($33,200) provided, further, beginning on

2-2

January 1, 2011 2014 and each January 1 thereafter, said amount shall be adjusted by the

2-3

percentage of increase in the Consumer Price Index for all Urban Consumers (CPI-U) as

2-4

published by the United States Department of Labor Statistics determined as of September 30 of

2-5

the prior calendar year; said adjustment shall be compounded annually and shall be rounded up to

2-6

the nearest five dollar ($5.00) increment. Any scheduled increase in the unified credit provided in

2-7

26 U.S.C. section 2010 in effect on January 1, 2003, or thereafter, shall not apply.

2-8

      (b) If the decedent's estate contains property having a tax situs status not within the state,

2-9

then the tax determined by this section is reduced to an amount determined by multiplying the tax

2-10

by a fraction whose numerator is the gross estate excluding all property having a tax situs status

2-11

not within the state at the decedent's death and whose denominator is the gross estate. In

2-12

determining the fraction, no deductions are considered and the gross estate is not reduced by a

2-13

mortgage or other indebtedness for which the decedent's estate is not liable.

2-14

      (c) (1) The terms "gross taxable estate", "federal gross estate" or "net taxable estate" used

2-15

in this chapter or chapter 23 of this title has the same meaning as when used in a comparable

2-16

context in the laws of the United States, unless a different meaning is clearly required by the

2-17

provisions of this chapter or chapter 23 of this title. Any reference in this chapter or chapter 23 of

2-18

this title to the Internal Revenue Code or other laws of the United States means the Internal

2-19

Revenue Code of 1954, 26 U.S.C. section 1 et seq.

2-20

      (2) For decedents whose death occurs on or after January 1, 2002, the terms "gross

2-21

taxable estate" "federal gross estate" or "net taxable estate" used in this chapter or chapter 23 of

2-22

this title has the same meaning as when used in a comparable context in the laws of the United

2-23

States, unless a different meaning is clearly required by the provisions of this chapter or chapter

2-24

23 of this title. Any reference in this chapter or chapter 23 of this title to the Internal Revenue

2-25

Code or other laws of the United States means the Internal Revenue Code of 1954, 26 U.S.C.

2-26

section 1 et seq., as they were in effect as of January 1, 2001, unless otherwise provided.

2-27

      (d) All values are as finally determined for federal estate tax purposes.

2-28

      (e) Property has a tax situs status within the state of Rhode Island:

2-29

      (1) If it is real estate or tangible personal property and has actual situs status within the

2-30

state of Rhode Island; or

2-31

      (2) If it is intangible personal property and the decedent was a resident.

3-32

     SECTION 2. This act shall take effect upon passage and it shall apply to the estates of

3-33

decedents dying after December 31, 2012.

     

=======

LC01117

=======

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO TAXATION - ESTATE AND TRANSFER TAXES - LIABILITY AND

COMPUTATION

***

4-1

     This act would allow for a credit against the Rhode Island estate tax of thirty-three

4-2

thousand two hundred dollars ($33,200) for decedents dying after December 31, 2012. This

4-3

credit is equivalent to an estate tax exemption of one million dollars ($1,000,000) for decedents

4-4

dying after December 31, 2012.

4-5

     This act would take effect upon passage and it would apply to the estates of decedents

4-6

dying after December 31, 2012.

     

=======

LC01117

=======

H7491