Viewing a single comment thread. View all comments

brianv83 t1_j7pffjg wrote

Reply to comment by Status_Silver_5114 in Is it me or is everyone relocating to RI? by boingochoingo

http://webserver.rilin.state.ri.us/Statutes/TITLE44/44-30/44-30-71.3.HTM#:~:text=(a)%20In%20a%20sale%20of,of%20the%20total%20payment%20to ... I recently closed on a home in RI and this was brought up, apparently if you sell and are no longer a RI resident they charge you 6% of the sale.

4

fishythepete t1_j7pmsko wrote

You are completely misinterpreting this. Yes, 6% of the sale is withheld. Just like federal taxes are withheld when you get a paycheck. When you file your taxes, if you do not owe capital gains or other taxes, it will be refunded.

It’s meant to keep retirees from cashing out and leaving the state, skipping out on capital gains tax.

7

Status_Silver_5114 t1_j7pg9sm wrote

So selling to move or had you already moved prior to sale? I mean just as I don’t shed a tear for non owner occupied landlords, I’d be hesitant to do so here as well tbh if you’re already somewhere else and it’s an investment like anything else. Do other states do this?

1

brianv83 t1_j7pigu8 wrote

Sold in Burrillville, bought in Scituate and was told if we weren't staying within the state we'd have to pay the 6% - family just sold a condo they owned in Smithfield as they retired to Nevada and had to pay the 6% ... no idea if other states do this

1

Status_Silver_5114 t1_j7pjq6j wrote

Isn’t that basically capital gains tax tho? Or at least some income tax (income Earned in the state)?

1

brianv83 t1_j7pkrz0 wrote

I don't know the tax code well enough but I believe that's a complete whole other thing at the federal level (not state) as it is the sale profit reported to the IRS and there are special rules regarding whether you owned it as a primary residence, how long you owned it, did you use the profit to purchase a new primary residence, etc. This was one of the things they asked at closing, how are you going to use the profit - for us it was for a down payment on a more expensive house with the rest going to renovations of our new primary residence which they said would basically render the capital gains moot.

1