Rhode IslandS28272026 Regular SessionSenateWALLET

AN ACT RELATING TO TAXATION -- PROPERTY SUBJECT TO TAXATION .

Sponsored By: Tiara T. Mack (Democratic)

Signed by Governor

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Bill Overview

Analyzed Economic Effects

30 provisions identified: 24 benefits, 2 costs, 4 mixed.

Lower home taxes on energy and goods

Home renewable‑energy systems placed in service after December 31, 2015 are exempt from property tax. Normal household items like furniture, clothing, bedding, and books are exempt. You can also exempt up to $1,500 of the cost to add a nuclear fallout shelter if it meets state emergency‑management standards.

No local tax on aircraft with fee

If you pay the aircraft fee required by state law to the tax administrator, your aircraft is exempt from local property tax.

No local tax on bullion and bonds

Local governments do not tax U.S. or Rhode Island tax‑exempt bonds. Unfabricated precious‑metal bullion valued by metal content is also exempt from local property tax. Precious metal made into special industrial or artistic items is not exempt.

Special breaks for clergy and Brown officers

A dwelling owned by a religious group and actually used by its officiating clergy is exempt, including the land up to one acre or the zone’s minimum lot size, if larger. Charlestown also covers convents, nunneries, and retreat centers. The president and professors of Brown University who claimed this benefit before and through December 31, 1996 can exempt up to $10,000 each.

Use tax credit for adapted vehicles

If you buy a vehicle and add disability adaptations, you get a Rhode Island use tax credit. The credit equals your adaptation costs, including installation, but cannot exceed the use tax due on the vehicle without the adaptations. This lowers the tax you pay at purchase.

Local business property tax breaks

Cities and towns may pass ordinances to exempt certain machinery and equipment bought after July 1, 1997 from property tax. These local breaks cannot reward a business that relocates within Rhode Island. The Charlestown town council may also exempt some tangible business or personal property to promote growth. These exemptions apply only if the local council approves them.

State tax break for cannabis businesses

Beginning January 1, 2025, state‑licensed cannabis businesses can subtract from Rhode Island income any expenses that federal law disallows under section 280E. You must hold a Rhode Island license under the cited chapters. The subtraction equals the disallowed expenses.

Government land and buildings not taxed

State‑owned property used for public purposes is exempt from local property tax, except as allowed by another state law. Land owned by the U.S. government is also not taxed by Rhode Island cities and towns.

No local tax on worship and schools

Buildings used only for religious worship or free public schools are exempt from local property tax. The land under and around them is also exempt, up to five acres. The sites must be used exclusively for those purposes.

Longer window to use business losses

Beginning January 1, 2025, companies can carry forward Rhode Island net operating losses for 20 years. Carrybacks are not allowed. The yearly deduction is still limited by federal rules under section 172.

Lower taxes on manufacturing equipment and energy

Rhode Island defines who counts as a manufacturer, including a receipts test of more than 50% from in‑state manufacturing. Manufacturers do not pay property tax on machines and equipment used for making, R&D, or quality testing, with partial use prorated. Inventory made in Rhode Island and still owned by the manufacturer is exempt. Certified air or water pollution‑control facilities and recycling or hazardous‑waste treatment equipment at the generator’s site are exempt; DEM certification can make this conclusive, and exemptions over 10 years need local approval. Hydroelectric turbines and related gear bought after July 1, 1979 and used by a dam owner or lessee are exempt. Renewable‑energy resources used by manufacturers are also exempt.

RI deduction for Opportunity Zone investors

Rhode Island lets corporations take the same Opportunity Zone income deduction that federal law allows if they hold the investment at least seven years. The Division of Taxation can set rules on how to apply these deductions.

Property tax relief for poor or infirm

A local assessor may exempt the estate of a person who cannot pay property tax because of infirmity or poverty. In Burrillville and West Greenwich, the unpaid tax becomes a five‑year lien and is erased after five years. If the property is sold, conveyed, or refinanced during those five years, the liened tax is due at that time. You can appeal a denial through the local board of tax review.

Wider nonprofit tax breaks, tenant tax added

The law expands property tax exemptions for charities, schools, libraries, nonprofit hospitals, and fraternal groups when property is used only for those purposes. For schools, the land right around the buildings is exempt up to one acre, and no profits may be paid to owners. It also exempts a charity’s intangible property, like investments, if the money supports its religious or charitable work. Burial grounds used only for burials and property of volunteer fire, ambulance, and rescue corps in active service are exempt. A city or town council may vote to exempt land used only to conserve open space. If an exempt owner leases space to a nonexempt user, the tenant is treated as the owner and must pay the property tax. In Smithfield, the town may bill actual police, fire, and rescue costs to a private nonprofit college unless they sign an agreement; this billing power begins March 1, 2014.

No property tax on registered motorboats

Your motorboat is exempt from local property tax if you pay the state’s annual motorboat fee. The rule applies only to motorboats that meet the state definition and have the required fee paid each year.

Town options to cut business property tax

Cities, towns, and fire districts may adopt local exemptions for tangible personal property if applied uniformly and under local rules. The Town of Bristol may, by council vote, exempt all or part of tangible business or personal property to promote business growth.

East Providence nonprofits get property tax relief

In East Providence, the law exempts listed nonprofit properties from local property tax. These include Providence Country Day School parcels; Heritage Harbor Foundation suites at 1445 Wampanoag Trail; the Brain Injury Association at 1017 Waterman Ave; American Legion Post 10 at 830 Willet Ave (only while the post owns it); the Holy Rosary Band at 328 Taunton Ave; and the Associated Radio Amateurs at 54 Kelly Ave. Foster Forward’s properties in the city are also exempt. The Pomham Island lighthouse parcel is exempt if a qualified 501(c)(3) owns it and uses it only as a lighthouse.

Pawtucket and Central Falls nonprofit tax relief

In Pawtucket, listed nonprofit properties are exempt from local property tax. These include the Cape Verdean Museum at 617 Prospect St; Foster Forward at 16 North Bend St; and Tides Family Services at 242 Dexter St. The Samaritans at 67 Park Place may receive an exemption in the amount set by the Pawtucket City Council. In both Pawtucket and Central Falls, passenger railroad property used for boarding and related service that is owned or leased by a PUC‑authorized railroad is exempt.

Property tax breaks for local nonprofits

This law exempts named nonprofit, cultural, and religious properties from local property tax. Examples include the Stadium Theatre in Woonsocket, St. Mary Academy — Bay View in East Providence, the Rhode Island Philharmonic Orchestra and Music School, and the Station Fire Memorial site in West Warwick. It also covers specific properties owned by United Methodist Elder Care, Zion Gospel Temple (first floor at 90 Leonard Ave.), the Cape Verdean Museum, and several local fraternal and community groups. These exemptions apply only while the named nonprofit owns the property and, where listed, only to the specified locations.

Property tax relief for vets and youth

Veterans’ organizations get a property tax exemption up to $400,000 statewide. Cranston may raise that local limit to $500,000 by ordinance. Property used only for military purposes is exempt if approved by the adjutant general. 501(c)(3) youth groups that serve kids ages 6–17 and are affiliated with a congressionally chartered national group are also exempt.

Providence nonprofits get property tax relief

In Providence, the law exempts property owned by several named nonprofits. These include Providence Community Health Centers; Sojourner House at 386 Smith St and 1570 Westminster St; the Providence Performing Arts Center; entities tied to the Providence YMCA building; and Meeting Street Center’s Eddy Street campus. Habitat for Humanity of Rhode Island—Greater Providence is also exempt for its Providence property. The law also exempts listed parcels of Sophia Academy, San Miguel Education Center, and Community Preparatory School.

Tax exemptions for named nonprofits and sites

The law exempts listed nonprofit and cultural properties from local property tax. Examples include the New England Wireless and Steam Museum (East Greenwich), Mount Saint Charles Academy parcels (Woonsocket), South County Community Action (North Kingstown), the Pokanoket Tribe land trust in Bristol when used for conservation and cultural protection, and many other named sites. Some exemptions require or recognize 501(c)(3) status. Each exemption only covers the named owner and address.

PPP loan forgiveness over $250K taxed

For corporate tax years beginning on or after January 1, 2020, forgiven PPP loan amounts over $250,000 are included in Rhode Island net income. Example: if $300,000 is forgiven, $50,000 is included in state taxable income.

Tax breaks for small and urban farms

The law exempts real and tangible property used on small farmland under five acres and on urban farmland. One farm building per lot up to 2,500 sq. ft. can also be exempt if used for farm work. Starting July 1, 2027, qualifying urban or small farmers do not pay sales or use tax on farm products used to grow food, and materials for new urban farm structures are also tax‑free. Urban farmers no longer need to show a past minimum gross sales amount to qualify. If land stops being small or urban farmland within 15 years, the town can charge a land‑use‑change tax from 10% (years 1–6) down to 1% in year 15 of current fair market value; after 15 years, no extra tax applies.

Cranston religious groups’ property tax break

In Cranston, tangible personal property owned and used only for a religious organization’s purposes is exempt from local property tax. The exemption applies only to property inside the City of Cranston and only when used exclusively for religious purposes.

Middletown, Tiverton, Block Island nonprofit relief

Lucy’s Hearth properties in Middletown are exempt from local property tax. Little Flower Home at 304 Hooper St in Tiverton is exempt while it remains a 501(c)(3) nonprofit. The Manissean Tribal Council’s property in New Shoreham (Block Island) is exempt.

South and West Bay nonprofit tax relief

The law exempts several named nonprofit properties in South and West Bay communities. In South Kingstown, the Contemporary Theatre Company at 321 Main St and four Johnnycake Center parcels are exempt. In North Kingstown, Pet Refuge at 500 Stony Lane, La Salle Academy at 7450 Post Rd, and the Old and Ancient Rowers at 166 Walmsley Lane are exempt. In West Warwick, the Artic Playhouse at 1249 Main St is exempt.

Tax break for Ocean State Community Wellness

Real property owned by Ocean State Community Wellness, Inc., a qualified tax‑exempt nonprofit, is exempt from local property tax. The exemption applies to property owned by that organization.

Farm food income now taxable

Income from producing food by urban and small farmers counts as Rhode Island taxable net income. The law defines who is an urban or small farmer, including acreage and filing Schedule F or an equivalent.

New tax rules for for-profit hospitals

When a nonprofit hospital becomes for‑profit, or a new for‑profit hospital opens, the assessor sets a fresh initial property value for that year. The hospital may appeal to the local assessor and then directly to the Superior Court business calendar. A city or town may sign a tax‑stabilization agreement, and taxes or payments for that facility that year do not count toward the town’s levy cap.

Sponsors & Cosponsors

Sponsor

Tiara T. Mack
Democratic • Senate

Cosponsors

Louis P. DiPalma
Democratic • Senate
V. Susan Sosnowski
Democratic • Senate
Jessica de la Cruz
Republican • Senate

Roll Call Votes

All Roll Calls

Yes: 97 • No: 9

House vote • 6/11/2026

PROPERTY SUBJECT TO TAXATION PASSAGE IN CONCURRENCE

Yes: 60 • No: 9

Senate vote • 6/9/2026

RELATING TO TAXATION -- PROPERTY SUBJECT TO TAXATION Passage

Yes: 37 • No: 0

Actions Timeline

Signed by Governor — Chapter 211
6/19/2026Governor
Transmitted to Governor
6/16/2026Governor
House passed in concurrence
6/11/2026House
Placed on House Calendar (06/11/2026)
6/11/2026House
Senate read and passed
6/9/2026Senate
Placed on Senate Calendar (06/09/2026)
6/2/2026Senate
Committee recommends passage
6/2/2026
Scheduled for consideration (06/02/2026)
5/29/2026
Committee recommended measure be held for further study
5/19/2026
Scheduled for hearing and/or consideration (05/19/2026)
5/15/2026
Introduced, referred to Senate Finance
3/4/2026Senate

Bill Text

S2827 - As Introduced
3/4/2026
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