Did you know 9 states do not require residents to pay a personal income tax? Folks that live in Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming, are exempt from this bill. Furthermore, 7 other states simply enforce a flat tax rate. So what’s the moral to the story? People who live in these states are able to buy more stuff because they pay less tax.
But for the rest of us, residential income tax is a necessary evil, one that takes a serious bite out of our disposable income. And while the forms are designed to collect the same data, they’re all constructed differently. What follows is a breakdown of Form RI-1040, the Rhode Island Individual Income Tax Return. If you don’t live in Rhode Island, not to worry, we’ll be tackling the other 34 states soon enough.
Guess what? The RI-1040 is only 21 Lines! Woohooo! You should be able to do your return in 15 minutes! Not so fast sparky; the RI-1040 will throw you for a loop if you’re not careful.
Form designers have chosen to put the signature section at the bottom of the second page. Why? I’m not sure. The entirety of the main form is on page 1 so that’s where you should sign. All that’s on the second page are a bunch of Schedules that you may or may not have to fill out. For this reason we’re giving the RI-1040 a mediocre 6 of 10 on our user-friendly meter. I’m sure this curveball has caused more than a few taxpayers to swing and miss.
Begin by filling in your name, address, phone and Social Security numbers. Next, you can knock out your filing status before moving on to the meat of the form. Capiche?
Enter your federal adjusted gross income on Line 1 and any net modifications (otherwise known as any state-specific additions or subtractions) on Line 2. If changes need to be made to your Federal AGI, you’ll need to fill out a RI Schedule I. Based on that number, you will add or subtract Line 2 from Line 1 and put the total on Line 3.
On Line 4, enter either your RI standard deduction of $7,500, or the amount from Line 29 of your Federal Schedule A, whichever is greater. If it behooves you to itemize, you’ll need to work through the RI itemized deduction schedule. Subtract Line 4 from Line 3 on Line 5.
On Line 6 enter the number of your federal exemptions in the box and multiply them by $3,500. Now you can subtract Line 6 from Line 5 to get your RI taxable income, which goes on Line 7. Based on your income, fill in the amount of tax you owe on Line 8. Rhode Island has slotted Line 9A for a percentage of allowable federal credits. Line 9B is a credit on income taxes paid to another state, and Line 9C allows for various other RI credits. On Line 10 subtract Line 9D from Line 8. On line 11 declare any checkoff contributions which you can find on page 2 of your RI Checkoff Schedule. Checkoff contributions are really just donations to causes the RI government supports... maybe mom was right, it does pay to be a good person. Line 12 is where you will need to declare any Use or Sales taxes due. Finally sum up Lines 10, 11, and 12 and put the total on Line 13.
Enter your Rhode Island withholdings on Line 14A, estimated tax payments on Line 14B, your property tax relief credit from RI-1040H on Line 14C, your RI earned income credit on Line 14D, a residential lead paint credit on Line 14E, and any other payments on Line 14F. Whew! Now add Lines 18A through 18F to get your total payments and credits, which goes on Line 18G.
If Line 13 is larger than Line 14G, then you still owe some tax. Enter the difference next to the unhappy face on Line 15 after you add any interest you might owe due to underestimating your tax (using either Form RI-2210 or RI-2210A). But if Line 14G is larger than Line 13 enter the amount you’ve overpaid next to the happy face on Line 16. Declare how much of your overpayment you want refunded to you on Line 17 and the amount of the overpayment you want applied to next year on Line 18.
And while that completes the main form, you still need to sign your return. You can find the signature section on the bottom of page 2. Unfortunately, it comes after RI Schedules I, II, III, and RI Schedule EIC. Work through these schedules if necessary, just make sure you sign and date your return.
If you choose to pass on the free e-file, know that Rhode Island is one of those states that forces you to send your return to a different address based on its outcome.
For refunds mail your return to:
The RI Division of Taxation
One Capitol Hill
Providence, RI 02908-5806
For payments mail your return to:
The RI Division of Taxation
One Capitol Hill
Providence, RI 0298-5807