How are capital gains taxed in Rhode Island?

Rhode Island has no separate capital gains rate. Capital gains are taxed as ordinary income at the state's graduated brackets of 3.75%, 4.75%, and 5.99%. This applies to both short-term and long-term gains, so the holding period does not change the Rhode Island portion.

What are the federal capital gains rates?

Long-term federal capital gains (assets held over one year) are taxed at 0%, 15%, or 20% depending on your taxable income. Short-term gains (one year or less) are taxed at your ordinary federal income tax rate, which can be much higher.

Does Rhode Island tax long-term gains differently than short-term?

No. Rhode Island taxes both short-term and long-term capital gains the same way — as ordinary income at its regular brackets. The difference only appears in the federal portion, where long-term gains get preferential 0/15/20% rates.

How do I calculate my capital gain?

Subtract your cost basis (what you paid, plus improvements and selling costs) from your sale proceeds. A positive result is a capital gain; a negative result is a capital loss that can offset other gains and a limited amount of ordinary income.

Is the 3.8% Net Investment Income Tax included?

This tool does not add the 3.8% federal Net Investment Income Tax, which applies to high earners above certain modified-AGI thresholds. If your income is high, add 3.8% to the federal portion for a complete estimate.

Rhode Island Capital Gains Tax Calculator

Email me this result

Get this tool's output sent to your inbox, plus one useful tool a week. No spam, unsubscribe any time.

Rhode Island investors pay both federal and state tax on capital gains. The federal portion depends on how long you held the asset, but Rhode Island taxes all gains as ordinary income. This calculator combines both for a total estimate.

How it works

First find your taxable gain:

gain = sale proceeds − cost basis

The federal tax depends on the holding period. Long-term gains (held over one year) are taxed at 0, 15, or 20 percent depending on your income. Short-term gains (one year or less) are taxed at your ordinary federal rate, which you enter directly.

Rhode Island then taxes the same gain as ordinary income using its brackets — 3.75 percent up to about 73,450 dollars, 4.75 percent to 166,950 dollars, and 5.99 percent above that. Because Rhode Island gives no preferential treatment, the holding period changes only the federal line.

Example

A 20,000 dollar long-term gain for an investor in the 15 percent federal bracket owes 3,000 dollars federal. If the gain sits in Rhode Island’s 4.75 percent bracket, the state tax is 950 dollars, for a combined 3,950 dollars — about a 19.75 percent total rate, leaving 16,050 dollars after tax.

Notes

This simplified tool applies a single Rhode Island marginal rate you select to the whole gain rather than layering it across brackets, so blended results may differ slightly. It excludes the 3.8 percent federal Net Investment Income Tax, the qualified small-business stock exclusion, and home-sale exclusions. Estimate only, not tax advice — confirm at irs.gov and tax.ri.gov.