Rhode Island taxes capital gains at 5.99%. Combined with federal taxes, your effective rate on a home sale could reach 24.8%.
RI State Rate
5.99%
Top marginal rate
Federal Rate
15%
Most common long-term bracket
Combined Effective
24.8%
On $150K taxable gain (example)
After the $250K/$500K exclusion, here's what a typical seller might owe.
If Rhode Island is where your primary residence is located and you've lived there at least 2 of the last 5 years, you can exclude up to $250K (single) or $500K (married filing jointly) of your capital gain from both federal and state taxes.
Investment and rental properties in Rhode Island don't qualify for the exclusion. You'll owe 5.99% state tax plus federal tax on the full gain, plus 25% depreciation recapture on any depreciation claimed.
In Rhode Island, homes sold in March sell for 23% more than those sold in October (-15%). Timing your sale right can offset a significant portion of your tax bill.
Capital gains tax rates on home sales in Rhode Island and nearby states.
| State | Rate | Tax on $150K Gain | Notes |
|---|---|---|---|
Rhode IslandYou | 5.99% | $8,985 | Top marginal rate |
| 6.99% | $10,485 | Top marginal rate | |
| 9% | $13,500 | 5% + 4% surtax on income > $1M |
Rhode Island taxes capital gains as ordinary income at rates up to 5.99%.
The state's small size means most markets are influenced by Providence metro and the coastal communities of Newport and Narragansett.
RI's rate is lower than neighbors Massachusetts (9%) and Connecticut (6.99%), offering some advantage.
Waterfront property values have increased significantly, creating potential for gains above the federal exclusion.
Offering buyer concessions?
Our sister tool helps you model different scenarios and maximize your position.