Rhode Island confirmed that the federal One Big Beautiful Bill Act’s no-tax-on-tips and -overtime provisions do not apply for state income tax purposes, according to an Oct. 2 tax advisory.
The OBBBA’s provisions, which is retroactively effective for calendar year 2025, allow certain taxpayers to deduct up to $25,000 in qualified tips and up to $12,500 in qualified overtime compensation on their federal personal income tax returns.
The advisory, issued by Rhode Island Department of Revenue’s Division of Taxation, explains that these provisions only apply to federal filings because they are not reflected in federal adjusted gross income, ...
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