If you qualify under the federal military spouse residency rules, income you earned while working in Rhode Island may be exempt from Rhode Island income tax.
According to the Rhode Island Individual Income Tax Instruction Booklet, income earned by a service member's spouse in Rhode Island can be exempt from Rhode Island income tax when all of the following are true:
- The spouse moved to Rhode Island only to be with the service member who is stationed there under military orders.
- The spouse and service member share the same domicile.
- That domicile is outside Rhode Island.
If you meet these requirements, you may be able to exclude your Rhode Island wages from Rhode Island taxable income and request a refund of any Rhode Island tax that was withheld from your pay.
How to Claim Exempt Status From Rhode Island Withholding
To claim exemption from Rhode Island withholding through your employer, you must meet both of these conditions:
- You are in Rhode Island only to be with your military spouse, who is stationed in Rhode Island under military orders.
- You and your military spouse share the same domicile outside Rhode Island.
If you qualify:
- Complete Form RI W-4.
- Enter "Exempt-MS" on Line 3.
- Give the completed form to your employer.
Your employer may ask for additional documentation to verify your eligibility.
How to Claim a Refund of Rhode Island Tax Withheld
If Rhode Island tax was withheld from income that qualifies for the military spouse exemption, follow these steps in the program:
- Go to State.
- Three dots to Edit Nonresident Rhode Island State Return.
- Go to Income Subject to Tax.
- Scroll down to Net Modifications.
- Enter the military spouse income as a negative amount.
- Select Continue twice.
- Go to Subtractions From Income.
- In Active Duty Military Pay of Nonresidents and Income from RI for Service Members Spouse, enter the total qualifying military pay and spouse income that is not subject to Rhode Island tax as a positive amount.
Important: Your Income May Still Be Taxable Elsewhere
Even if your income is exempt from Rhode Island tax, it may still be taxable by the state where you are a resident. Be sure to report the income on your resident state return if required.