Rhode Island tax amnesty waives penalties starting Dec. 3

Rhode Island’s tax-amnesty program is scheduled to open Dec. 3, giving qualifying taxpayers 75 days to settle eligible delinquent state taxes with penalties waived and 25% of interest reduced. The program is set to close Feb. 15, 2027.

The Division of Taxation announced the dates and standard terms Oct. 16. The program is not yet underway, and the Division says it will not accept amnesty payments before Dec. 3. The amnesty applies to eligible tax periods ending on or before Dec. 31, 2025; it does not forgive the underlying tax.

Who can use the program

Individuals, corporations and other entities with qualifying unpaid Rhode Island tax liabilities may apply. The Division says all taxes and fees it administers are eligible, but employer taxes handled by the Department of Labor and Training are not. Those exclusions include unemployment insurance taxes, Job Development Fund assessments and temporary disability insurance taxes.

Applicants must bring delinquent returns up to date and submit a written application during the amnesty period. Under the Division’s standard payment terms, taxpayers pay the full tax owed and 75% of the interest. The remaining 25% of interest is reduced, and applicable penalties are waived if the program’s conditions are met.

The distinction matters: the relief lowers penalties and part of the interest, not the principal tax debt. Taxpayers with eligible balances should account for the filing requirement as well as the payment terms when deciding whether they can meet the program’s conditions.

Hardship option and exclusions

State law allows taxpayers facing financial hardship to seek an installment agreement. The tax administrator sets the agreement’s terms and conditions. If a participant misses an installment, the agreement ends and the unpaid balance becomes due immediately.

The law bars amnesty for taxpayers under criminal investigation or involved in a pending civil or criminal court proceeding over fraud related to a state tax. For a tax period granted amnesty, the law also directs the tax administrator not to seek applicable penalties or civil or criminal prosecution, provided the taxpayer satisfies the program’s conditions.

The program was established through the 2026 Tax Amnesty Act. Gov. Dan McKee signed the fiscal year 2027 budget, which included the law, on June 12. The Division’s announcement describes the upcoming program’s implementation dates and standard payment terms.

Before the window opens, the Division says it plans to mail account statements in November to taxpayers with known outstanding Rhode Island tax balances. The statements are intended to help taxpayers identify their accounts. The amnesty period itself begins Dec. 3, and payments will not be accepted under the program before that date.