Rhode Island Withholding laws & HR compliance analysis

Rhode Island Withholding: What you need to know

The Rhode Island withholding law requires employers in the state to withhold Rhode Island income tax from wages of residents for performing services both inside and outside the state and of nonresidents for service performed within the state. A "resident" is defined as anyone who is domiciled in the state or who spends 183 days of a tax year in the state. The definition of wages under Rhode Island's law is the same as for federal tax purposes. Employers must withhold state income taxes at the time of each wage payment. The amount to be withheld may be calculated using the percentage method provided by the Division of Taxation.
For a Limited Time receive a FREE HR Report on the "Critical HR Recordkeeping”.  This exclusive special report covers hiring records, employment relationships, termination records, litigation issues, electronic information issues, tips for better recordkeeping, and a list of legal requirements.  Download Now
Employees. Employees must complete Form RI W-4 at the start of employment. In addition, the RI W-4 may be completed if the employee wants to adjust the amount of Rhode Island income tax withholding. Adjustments can be made to the RI W-4 form at any time throughout the year. Employers must maintain the RI W-4 as part of their payroll records and make them available to the Division of Taxation on request. When an employee wants additional Rhode Island income tax to be withheld, he or she should submit an RI W-4 to the employer. The additional amount of Rhode Island income tax withholding is entered on line 2 of Form RI W-4. Employers are not required to determine the correctness of the withholding allowance certificates and may rely on the number of state withholding exemptions claimed on the RI W-4 by the employee. Employees exempt from federal tax withholding because they had no tax liability in the preceding year and expect none in the current year are also exempt from Rhode Island withholding.
Employers. Employers remit withheld taxes either quarterly if less than $50 is ...

Read more about Withholding