Selling a business in Rhode Island: what the state takes (2026)
Rhode Island’s top individual income tax rate is 5.99%. Here is what an owner selling company stock pays, with 2026 rules from official sources and worked examples at $10 million, $25 million and $50 million.
- 5.99%
- Top Rhode Island income tax rate (2026)
- $1,497,500
- State tax on a $25M long-term gain
- 29.8%
- Combined federal and state rate on $25M
- 15 of 51
- Rank by total tax on $25M (1 = highest)
How Rhode Island taxes a business sale
- Income tax
- Top rate 5.99%: Over $186,450 (uniform schedule, all filers).
- Long-term capital gains
- Capital gains are taxed as ordinary income at up to 5.99% in 2026, with no exclusion or preferential rate.
Three worked examples
| Long-term gain | $10,000,000 | $25,000,000 | $50,000,000 |
|---|---|---|---|
| Federal capital gains tax (20%) | $2,000,000 | $5,000,000 | $10,000,000 |
| Net investment income tax (3.8%) | $380,000 | $950,000 | $1,900,000 |
| Rhode Island tax | $599,000 | $1,497,500 | $2,995,000 |
| Total tax | $2,979,000 | $7,447,500 | $14,895,000 |
| Effective combined rate | 29.79% | 29.79% | 29.79% |
| Net proceeds after tax | $7,021,000 | $17,552,500 | $35,105,000 |
| Extra tax versus Texas | $599,000 | $1,497,500 | $2,995,000 |
Seller’s tax calculator
Estimate federal and state tax on a stock sale and what is left before fees and debt.
- Long-term capital gain
- $25,000,000
- Federal capital gains tax (20%)
- $5,000,000
- Net investment income tax (3.8%)
- $950,000
- Rhode Island tax
- $1,497,500
- Taxable gain at 5.99%
- $1,497,500
- Total tax
- $7,447,500
- Effective rate on the gain
- 29.79%
- Net proceeds after tax
- $17,552,500
Illustration, not tax advice. Assumes a resident individual, the whole gain long-term, top marginal rates, no state credits, installment terms, QSBS exclusion or other planning, and no local taxes. Net proceeds are before transaction fees, debt repayment, escrows and earn-outs. Rates are for tax year 2026 where published; see the methodology.
Compare with other states
Neighboring states
- Connecticut30.8% combined, $17.30M net
- Massachusetts32.6% combined, $16.84M net
Common comparisons
- California37.1% combined, $15.72M net
- New York34.1% combined, $16.48M net
- Texas23.8% combined, $19.05M net
- Florida23.8% combined, $19.05M net
- Nevada23.8% combined, $19.05M net
- Washington33.5% combined, $16.63M net
- Tennessee23.8% combined, $19.05M net
Methodology and sources
Rhode Island figures are for tax year 2026. 2026 brackets come from Division of Taxation ADV 2025-22 (Nov 3, 2025). The FY2027 budget (H 7127, signed June 2026) adds a surtax on taxable income over $1 million starting in tax year 2027: 1% in 2027, 2% in 2028 and 3% from 2029, for a top rate of 8.99%. It does not apply to 2026. The examples assume a resident individual selling privately held stock for a long-term gain equal to the sale price (zero basis), with every dollar taxed at the top marginal rates, the federal 20% capital gains rate and the 3.8% net investment income tax, and no planning, credits or local taxes. Full assumptions are in the report methodology.
All 50 states and DC with source URLs.
- 1RI Division of Taxation ADV 2025-22, Inflation-adjusted amounts set for Tax Year 2026
- 2EY Tax News, Rhode Island law imposes a personal income tax surtax on income exceeding $1 million (H 7127). Secondary source
- 3Rhode Island Current, FY27 budget heads to Gov. McKee's desk after Senate approval. Secondary source
- 4Tax Foundation, State Individual Income Tax Rates and Brackets, 2026. Secondary source
Data last updated October 26, 2026.
Cite this research
You may quote and republish figures from this page with attribution and a link to the source.
Citation
Laurent Capital Research, “The Seller’s Tax Map: What Selling a Business Costs in Every State (2026): Rhode Island,” 2026, https://laurent.capital/research/seller-tax-map/rhode-islandLink (HTML)
<a href="https://laurent.capital/research/seller-tax-map/rhode-island">The Seller’s Tax Map: What Selling a Business Costs in Every State (2026): Rhode Island</a> (Laurent Capital)Planning a sale and weighing the tax cost?
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