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§44-11-2  Imposition Of Tax. [Effective Until January 1, 2016.]. –


Published: 2015

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TITLE 44

Taxation

CHAPTER 44-11

Business Corporation Tax

SECTION 44-11-2



   § 44-11-2  Imposition of tax.

[Effective until January 1, 2016.]. –

(a) Each corporation shall annually pay to the state a tax equal to nine

percent (9%) of net income, as defined in § 44-11-11, qualified in §

44-11-12, and apportioned to this state as provided in §§ 44-11-13

– 44-11-15, for the taxable year. For tax years beginning on or after

January 1, 2015, each corporation shall annually pay to the state a tax equal

to seven percent (7.0%) of net income, as defined in § 44-11-13 -

44-11-15, for the taxable year.



   (b) A corporation shall pay the amount of any tax as computed

in accordance with subsection (a) of this section after deducting from "net

income," as used in this section, fifty percent (50%) of the excess of capital

gains over capital losses realized during the taxable year, if for the taxable

year:



   (1) The corporation is engaged in buying, selling, dealing

in, or holding securities on its own behalf and not as a broker, underwriter,

or distributor;



   (2) Its gross receipts derived from these activities during

the taxable year amounted to at least ninety percent (90%) of its total gross

receipts derived from all of its activities during the year. "Gross receipts"

means all receipts, whether in the form of money, credits, or other valuable

consideration, received during the taxable year in connection with the conduct

of the taxpayer's activities.



   (c) A corporation shall not pay the amount of the tax

computed on the basis of its net income under subsection (a) of this section,

but shall annually pay to the state a tax equal to ten cents ($.10) for each

one hundred dollars ($100) of gross income for the taxable year or a tax of one

hundred dollars ($100), whichever tax shall be the greater, if for the taxable

year the corporation is either a "personal holding company" registered under

the federal Investment Company Act of 1940, 15 U.S.C. § 80a-1 et seq.,

"regulated investment company", or a "real estate investment trust" as defined

in the federal income tax law applicable to the taxable year. "Gross income"

means gross income as defined in the federal income tax law applicable to the

taxable year, plus:



   (1) Any interest not included in the federal gross income;

minus



   (2) Interest on obligations of the United States or its

possessions, and other interest exempt from taxation by this state; and minus



   (3) Fifty percent (50%) of the excess of capital gains over

capital losses realized during the taxable year.



   (d)(1) A small business corporation having an election in

effect under subchapter S, 26 U.S.C. § 1361 et seq., shall not be subject

to the Rhode Island income tax on corporations, except that the corporation

shall be subject to the provisions of subsection (a), to the extent of the

income that is subjected to federal tax under subchapter S. Effective for tax

years beginning on or after January 1, 2015, a small business corporation

having an election in effect under subchapter S, 26 U.S.C. § 1261 et seq.,

shall be subject to the minimum tax under § 44-11-2(e).



   (2) The shareholders of the corporation who are residents of

Rhode Island shall include in their income their proportionate share of the

corporation's federal taxable income.



   (3) [Deleted by P.L. 2004, ch. 595. art. 29, §

1.]



   (4) [Deleted by P.L. 2004, ch. 595, art. 29, §

1.]



   (e) Minimum tax. The tax imposed upon any corporation

under this section, including a small business corporation having an election

in effect under subchapter S, 26 U.S.C. § 1361 et seq., shall not be less

than five hundred dollars ($500).



History of Section.

(G.L. 1938, ch. 37, § 2; P.L. 1947, ch. 1887, art. 1, § 1; P.L. 1949,

ch. 2168, § 1; P.L. 1951, ch. 2733, art. 1, § 1; P.L. 1952, ch. 3026,

art. 1, § 1; P.L. 1953, ch. 3150, art. 1, § 1; P.L. 1954, ch. 3254,

art. 1, § 1; P.L. 1955, ch. 3521, art. 1, § 1; G.L. 1956, §

44-11-2; P.L. 1956, ch. 3739, art. 1, § 1; P.L. 1957, ch. 44, art. 1,

§ 1; P.L. 1958, ch. 17, art. 3, § 1; P.L. 1959, ch. 169, art. 2,

§ 1; P.L. 1960, ch. 66, art. 2, § 1; P.L. 1965, ch. 34, § 1;

P.L. 1966, ch. 238, § 1; P.L. 1966, ch. 245, § 7; P.L. 1968, ch. 263,

art. 5, §§ 1, 2; P.L. 1970, ch. 139, art. 1, § 1; 1970, ch. 226,

§ 1; P.L. 1974, ch. 151, art. 4, § 1; impl. am. P.L. 1974, ch. 200,

art. 2, § 2; P.L. 1977, ch. 133, § 2; P.L. 1983, ch. 2, art. 8,

§ 1; P.L. 1988, ch. 12, § 1; P.L. 1989, ch. 126, art. 20, § 1;

P.L. 1992, ch. 15, art. 4, § 1; P.L. 2004, ch. 595, art. 17, § 6;

P.L. 2004, ch. 595, art. 29, § 1; P.L. 2014, ch. 145, art. 12, §

15.)