Rhode Island Reciprocity

[Golden Rocket]

Client has just won a Navy Contract in Newport, RI.

Newport is on the Massachusetts border. Almost half of the employees live in Massachusetts.

Question: 1 Does Rhode Island have reciprocity with Massachusetts for SIT withholding?
2. If we allow MA withholding on this contract, will that factor by itself result in my client having to file a Massachusetts corporate return?

[Golden Rocket]

Nope

Gave up on getting a response. Board is moving fast with federal issues and only a tiny fraction of board members would know anyway.

So I called the Rhode Island Revenooers. They DO NOT have reciprocity. I said that was fine with us, we don't like Taxachussetts anyway.

Their response was interesting:

"Neither do we!"

[Gary2]

... Taxachussetts anyway.

Massachusetts has a flat 5.3% income tax (on most income). Rhode Island has a graduated tax that starts at 3.75%, but jumps to 7% at about $34K of taxable income for single people, $57K for MFJ, maxing out at 9.9%, with an alternative flat rate of 6.5% (if that's lower than the graduated tax) and AMT of 6.5 or 7%. (It's not clear when anyone would actually pay the 9.9% rate.)

Massachusetts has a 6.25% sales tax rate. RI has a 7% sales tax rate.

Want to pass that Taxachusetts claim by me again?

[Snaggletooth]

Reciprocity

Sounds like you guys don't like them either.

Taxachussetts and Rip-Off Island??