Rhode IslandH86112026 Regular SessionHouse

AN ACT RELATING TO TAXATION -- TAXATION OF BANKS .

Sponsored By: Alex Marszalkowski (Democratic)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 0 benefits, 0 costs, 3 mixed.

Case-by-case rules for pre-2025 apportionment

For tax years that end before January 1, 2025, the taxpayer or the tax administrator may adjust apportionment. They may drop or add factors, or use another fair method. These changes apply only when the standard rules do not fairly reflect Rhode Island business.

Receipts-only option, but some credits barred

Beginning January 1, 2025, a bank may elect receipts-only apportionment by filing the prescribed form with its return. The election applies for that year and stays in effect for later years. After at least five later years, the bank may ask to revoke it if facts or law materially change. If the receipts factor is missing (both parts are zero), all net income is taxable to Rhode Island. A bank that makes this election cannot claim any benefit under chapter 64.5 of title 42. The receipts factor uses the bank’s own cash or accrual method.

Three-factor formula for bank taxes

Rhode Island taxes a multi-state bank’s income by an apportionment percentage. It is the average of receipts, property, and payroll factors. If one factor is truly missing (both parts are zero), average the other two. If two are missing, use the one left. A zero numerator alone does not make a factor missing. Each factor uses the same accounting method the bank uses that year.

Sponsors & Cosponsors

Sponsor

Alex Marszalkowski
Democratic • House

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

All Roll Calls

Yes: 71 • No: 0

House vote • 6/10/2026

TAXATION OF BANKS PASSAGE