2014 -- S 2329

========

LC004386

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

____________

A N   A C T

RELATING TO TAXATION - ESTATE AND TRANSFER TAXES

     

     Introduced By: Senators Jabour, Walaska, Felag, McCaffrey, and Bates

     Date Introduced: February 12, 2014

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

1

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

2

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

3

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

4

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

5

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

6

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

7

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

8

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

9

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

10

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

11

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

12

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

13

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

14

      (3) For decedents whose death occurs on or after January 1, 2010, and prior to January 1,

15

2015, a tax is imposed upon the transfer of the net estate of every resident or nonresident

16

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

17

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

18

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

19

hundred and fifty thousand dollars ($850,000); provided, further, beginning on January 1, 2011

 

1

and each January 1 thereafter, until January 1, 2015, said amount shall be adjusted by the

2

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

3

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

4

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

5

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

6

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

7

     (4) For decedents whose death occurs on or after January 1, 2015, a tax is imposed upon

8

the transfer of the net estate of every resident or nonresident decedent as a tax upon the right to

9

transfer. The tax is a sum equal to the maximum credit for state death taxes allowed by 26 U.S.C.

10

2011 as it was in effect as of January 1, 2001; provided, however, that a credit shall be allowed

11

against any tax so determined in the amount of ninety-nine thousand, six hundred dollars

12

($99,600).

13

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

14

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

15

fraction whose numerator is the gross estate excluding all property having a tax situs not within

16

the state at the decedent's death and whose denominator is the gross estate. In determining the

17

fraction, no deductions are considered and the gross estate is not reduced by a mortgage or other

18

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

19

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

20

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

21

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

22

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

23

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

24

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

25

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

26

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

27

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

28

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

29

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

30

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

31

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

32

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

33

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

34

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

 

LC004386 - Page 2 of 3

1

Rhode Island; or

2

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

3

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

4

decedents dying after December 31, 2014.

========

LC004386

========

 

LC004386 - Page 3 of 3

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION - ESTATE AND TRANSFER TAXES

***

1

     This act would allow a credit against the Rhode Island estate tax of ninety-nine thousand,

2

six hundred dollars ($99,600) for decedents dying after December 31, 2014. The credit is

3

equivalent to an estate tax exemption of two million dollars ($2,000,000) for decedents dying

4

after December 31, 2014.

5

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

6

dying after December 31, 2014.

========

LC004386

========

 

LC004386 - Page 4 of 3