The Rhode Island Division of Taxation has released the state income tax withholding tables for tax year 2018. See the Attachment for a reproduction of the annual percentage method table in effect for wages paid after December 31, 2017.

Calendar year 2017 Forms W-2 and RI-W3, Reconciliation of Personal Income Tax Withheld by Employers, are due by January 31, 2018.

A list of the 2018 withholding tax filing deadlines is available here.

For more information on Rhode Island withholding tax, call +1 401 574 8829 or see the Division's website.

Supplemental wages

The supplemental withholding rate for 2018 continues at 5.99%.

Supplemental wages are compensation paid in addition to an employee's regular wages. They include, but are not limited to, bonuses, commissions, overtime pay, payments for accumulated sick leave, severance pay, awards, prizes, back pay and retroactive pay increases for current employees, and payments for nondeductible moving expenses. Other payments subject to the supplemental wage rules include taxable fringe benefits and expense allowances paid under a nonaccountable plan. How an employer withholds on supplemental payments depends on whether the supplemental payment is identified as a separate payment from regular wages.

If supplemental wages, such as bonuses, commission, overtime pay and back pay are paid with regular wages, the income tax to be withheld must be determined as if the total were a single wage payment for the regular payroll period. However, if the supplemental wages are paid separately, the employer may add the supplemental wages to the regular wages paid to the employee for the last preceding payroll period, determine the amount to be withheld as if the aggregate amount were a single payment, subtract the tax withheld for the last preceding payroll period and withhold the remaining tax from the supplemental wage payment. (2018 Rhode Island Employer's Income Tax Withholding Tables, Rhode Island Division of Taxation, December 2017.)

Form RI W-4

Rhode Island does not require employers to obtain a separate certificate showing the number of dependents or other personal exemptions claimed by an employee. In computing both the federal withholding and the Rhode Island withholding for employees, the employer may rely on the federal Form W-4. Employees electing additional federal withholding may elect additional Rhode Island withholding. Employees electing additional Rhode Island withholding should do so on Form RI W-4. The 2018 Form RI W-4, which the employer is required to keep on file, is included in the 2018 employer withholding booklet and available separately here.

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