In Rhode Island’s state budget bill for fiscal year 2010, signed by Governor Donald L. Carcieri on June 30, 2009, the lower capital gains rate is eliminated for personal income tax 
purposes. For tax years beginning on or after January 1, 2010 capital gains will be treated as ordinary income. As a result, some capital gains in Rhode Island that could have been taxed at rates as low as 1.67% will now be taxed at rates up to 9.9%.
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At the new higher rates, 1031 exchanges and other tax-deferral techniques will see a rebound in popularity. For more information on 1031 exchanges, visit the All States 1031 Exchange Facilitator, LLC website by clicking here.
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