Rhode Island Estate Tax 2026: $1,838,056 Line, $87,940 Credit

What the law and the form say

Most pages on this tax give one number, the threshold, and stop. The statute, the advisory and the form fit together as a short computation that you can run yourself.

Two consequences matter before any number does. First, the federal exclusion of $15,000,000 for 2026 (our federal exemption page covers it) plays no part: Rhode Island taxes estates a federal return would never see. Second, because the statute is frozen at 2001 law, the schedule below is the same old federal credit table that Massachusetts uses, and only the credit moves.

We searched the House Fiscal Advisory Staff’s enacted budget for fiscal year 2027, a 967-page PDF created on June 24, 2026, for a change to the tax. It mentions the estate tax only as a revenue line: “Estate and Transfer” is budgeted at $94,325,325 for fiscal 2027, against $96,200,000 for fiscal 2026 and $84,884,357 for fiscal 2025 (draft), and that line includes the transfer tax. We found no 2026 change to the thresholds or the schedule, but we did not read the other 2026 bills one by one.

A credit, not a cliff: 7.2 cents on the first dollar over $1,838,056

Searchers expect a threshold with a jump, as in New York. Rhode Island has none. At a net taxable estate of $1,838,056 the adjusted estate is $1,778,056, the schedule gives $87,940 (our arithmetic: $70,800 plus 7.2% of $238,056) and the credit takes all of it. The band that contains the line starts at an adjusted estate of $1,540,000 and runs to $2,040,000, so the first taxable dollar is charged at 7.2%.

Each row is the tax at the bottom of the band and the rate charged on the next dollar (our arithmetic). The marginal rate rises by 0.8 points per band, from 7.2% to 16%, which starts at an adjusted estate of $10,040,000, a net taxable estate of $10,100,000.

Tax by estate size, $1.8 million to $15 million

Every figure below is our arithmetic from page 21 and the 2026 credit on page 22 of Form RI-706. It treats the number as the net taxable estate (gross estate less debts, expenses, mortgages and the marital and charitable deductions), a 2026 death and all property in Rhode Island.

The average rate is the tax divided by the net taxable estate. Because the credit is a flat $87,940, it matters most near the line and least at the top: it removes all of the tax at $1,838,056, 63% of the schedule at $2,500,000 and about 8% of it at $10,000,000 (our arithmetic).

For reference, this is the Tax Computation Schedule as Form RI-706 prints it, in adjusted-taxable-estate terms (net taxable estate less $60,000). The Division prints it in columns; we have joined them:

The credit moves every year, the schedule does not

The credit is indexed to the CPI-U and the line moves with it. The Division’s advisory publishes both back to 2015, and the same $3,000,000 estate has paid less each year since 2017 (our arithmetic, one fixed schedule, each year’s credit).

Between 2015 and 2026 the credit rose $23,540 and so the tax on a fixed $3,000,000 estate fell by the same amount. The schedule did not change, so an estate that grows with the market can still be pulled over the line, but a house valued at a constant price is pulled over it more slowly each year. The 2027 figures will be published, as the 2026 ones were, near the end of December; the advisory for 2026 is dated December 30, 2025.

Rhode Island next to Massachusetts

The two states use identical tables and differ in the credit: $87,940 here, $99,600 in Massachusetts (our Massachusetts page shows the figure and its source). In our arithmetic that means:

The gap is the $11,660 difference between the two credits at every size above $2,000,000, and below it Rhode Island starts taxing 7.2% of each dollar from $1,838,056 where Massachusetts starts at $2,000,000. What differs more is how each state treats property it cannot reach, which is the next section. Our list of every state estate and inheritance tax puts this next to 16 other jurisdictions.

Out-of-state rentals and nonresidents: the tax is prorated

Section 44-22-1.1(b) reduces the tax when the estate holds property with a tax situs outside Rhode Island: the tax is multiplied by a fraction whose numerator is the gross estate excluding that property and whose denominator is the whole gross estate. Under subsection (e), real estate and tangible personal property have a Rhode Island situs when they sit in the state, and intangible personal property has a Rhode Island situs only if the decedent was a resident. The form turns that into one line. For a resident, Part 4, line 3 reads “Enter the amount of Rhode Island Assets excluding non-Rhode Island real and tangible property”; for a decedent not domiciled here it reads “Enter the amount of Rhode Island real and tangible property.”

The tax is computed first on the whole federal-basis estate, then multiplied by the Rhode Island percentage to four decimals. In our arithmetic, with no deductions:

The third row is the one to notice. A $1,200,000 building is far below $1,838,056, and a state that recomputes the tax on in-state property alone would charge nothing on it. Rhode Island instead taxes the owner’s whole estate at the rate its size produces and takes 40% of that. Nonresidents with a Rhode Island rental, including Newport-area second homes, should run the whole-estate figure and not the building alone. The home state may tax the rest, and the credit for tax paid to another state is outside the sources we read.

Funds and LLCs. Under the situs rule, a nonresident’s membership interest in an LLC or shares of a REIT or BDC are intangible personal property, so on the wording of the statute they are not counted in the numerator even if the LLC owns a Rhode Island building. That is our reading of subsection (e)(2); the Division’s forms do not discuss it, and a building held in the owner’s name is counted. For a resident, the LLC interest counts in full, wherever the building sits. Rhode Island securities, meaning Rhode Island incorporated stock, Rhode Island state and municipal bonds and mutual funds organized as business trusts that do business in the state, need a Form T-79 waiver.

Filing is required below the line: the $1.3 million return and the lien

The Form RI-706 instructions say the return “must be completed and filed by the executor(s)/administrator(s)/personal representative(s) of every decedent with property and/or other assets in Rhode Island.” What changes with size is how much of it you complete.

The $1,300,000 line is below the taxable line of $1,838,056, so a house, a rental and an IRA can need the full return while owing nothing. The advisory lists three reasons non-taxable estates file anyway: to obtain a discharge of the automatic statutory lien that attaches to all real estate the decedent owns at death, to obtain a Notice of No Tax Due for probate court purposes, and to obtain a waiver to allow the sale of Rhode Island securities. For an heir who wants to sell a rental, the T-77 discharge is the document the buyer’s title company will ask for. A federal Form 706 is attached only “if the estate is required to file”; the federal exclusion is far higher than the Rhode Island line, as our federal page explains.

On a $5,000,000 estate (tax $303,660) a month of interest at 12% a year is $3,036.60 and a month of the 0.5% penalty is $1,518.30 (our arithmetic). Our probate guide covers the court process that runs in parallel.

Couples: no portability found, and a bypass of about $1.8 million

We found no provision in R.I. Gen. Laws 44-22-1.1 that lets a survivor use a deceased spouse’s unused exclusion. The statute is a tax and a flat credit, not an exemption amount, so there is nothing to carry over, and the return has a marital deduction (Schedule M) with the federal QTIP text. In our arithmetic:

The difference is $165,600. The bypass is sized to the Rhode Island credit, about $1.8 million, and not to the federal $15,000,000, and the trade-off is basis: property in a bypass trust does not get a second step-up at the survivor’s death. Our page on credit-shelter trusts, QTIP and disclaimers covers that choice, and the step-up page the income-tax side. Because the credit is indexed upward each year, a trust drafted today for a fixed dollar amount can be out of date within a few years.

If you own rentals, LLC interests or fund shares

The bill is cash, due in nine months, and most of the estates above the line are not cash. Three points follow from the documents above.

• Values are the federal ones. The statute says values are “as finally determined for federal estate tax purposes,” and the form lets the executor elect alternate value amounts instead of date-of-death values. A rental or a share of a non-traded fund is valued on one of those two bases, not at the price the heirs later get.
• The lien is on the real estate. The automatic statutory lien must be discharged with Form T-77 before a clean sale. A building that takes longer to sell, or a fund that repurchases only in set windows, can make the nine-month date hard; see what happens to non-traded REIT and BDC shares at death.
• Out-of-state buildings stay in the base for a resident. They only reduce the Rhode Island share (table above). If the building sits in an LLC, the interest is intangible and counts in full for a resident.

What a reader can do with this

What you can check before talking to anyone:

• Find the net taxable estate. Add the home, rentals, fund and LLC interests, retirement accounts, life insurance you own and cash; subtract debts, mortgages, expenses and what passes to a spouse or charity; read the grid above against $1,838,056.
• List what is outside Rhode Island and how it is titled. A deed puts the building in the out-of-state column; an LLC interest does not.
• If you live elsewhere and own a Rhode Island rental, run the tax on the whole estate and multiply by the Rhode Island share, as in the nonresident rows.
• Check a couple’s documents. If everything passes to the survivor, the first spouse’s credit is wasted. Check whether the plan uses a bypass or a disclaimer.
• Plan the cash and the paperwork. The bill and the return are due in nine months; real estate needs the T-77 lien discharge even when no tax is due.

The decision, and who makes it. The estate plan is drafted by an estate-planning attorney, the Rhode Island and federal returns are prepared by that attorney or a CPA, and appraisals come from credentialed appraisers. A financial adviser’s part is how the tax would be paid and what to sell. Nothing here is a recommendation to change a plan.

This is analysis of public documents, not investment, legal or tax advice.

FAQ

Sources, read and saved on October 22, 2026 (statute and forms copies first read October 21): R.I. Gen. Laws 44-22-1.1 (webserver.rilegislature.gov); Rhode Island Division of Taxation advisory ADV 2025-27, December 30, 2025, “Rhode Island estate tax credit and threshold set for 2026”; Form RI-706, Estate Tax Return, with the Tax Computation Schedule (page 21) and credit chart (page 22), revised 11/2025; Form RI-706 instructions, revised 01/2025; Rhode Island House Fiscal Advisory Staff, Budget as Enacted Fiscal Year 2027 (PDF dated June 24, 2026, pages 44 and 952). The tax grids, band table, year-by-year comparison, Massachusetts comparison and the apportionment, couple and penalty cases are our arithmetic, with the assumptions stated; the Massachusetts credit comes from our Massachusetts page. We did not read the Rhode Island tax-situs rules for trusts, the federal credit for state death taxes or other states’ tax credits for Rhode Island tax. This is analysis of public documents, not investment, legal or tax advice.