How Much Tax Is Deducted From a Paycheck in Rhode Island?

A clear understanding of paycheck deductions is important for effective personal financial management. Your gross earnings, or the total amount you earn before any reductions, are not typically the same as your net pay, the amount you actually receive. Various deductions are taken from your gross pay, impacting your take-home amount.

Understanding Federal Income Tax Withholding

Federal income tax withholding is a pay-as-you-go system where employers deduct taxes from each paycheck and send them to the U.S. Treasury. This ensures taxpayers meet annual tax obligations throughout the year, avoiding a large year-end tax bill. The amount withheld depends on information provided by the employee on Form W-4, Employee’s Withholding Certificate.

The Form W-4 guides employers on how much federal income tax to withhold. Employees indicate their filing status, such as single, married filing jointly, or head of household, which directly influences the standard deduction and tax bracket thresholds applied. Additionally, employees can account for dependents, other income sources, and specific deductions or credits to fine-tune their withholding.

Employers utilize IRS Publication 15-T, Federal Income Tax Withholding Methods, to accurately calculate the withholding amount based on the employee’s Form W-4. This publication provides detailed tables for various pay periods and filing statuses. The federal income tax system is progressive, meaning different portions of income are taxed at increasing rates across various tax brackets, with rates ranging from 10% up to 37% for ordinary income in 2025. For instance, a single individual’s taxable income in 2025 may benefit from a standard deduction of $15,000, reducing the income subject to these rates.

Rhode Island State Income Tax Withholding

Rhode Island imposes its own state income tax, which is withheld from employee paychecks in a manner similar to federal income tax. The state requires employers to deduct a portion of wages and remit these funds to the Rhode Island Division of Taxation.

The Rhode Island state income tax system is progressive, featuring three tax rates for 2025: 3.75%, 4.75%, and 5.99%. These rates apply to different income brackets, with the 3.75% rate covering taxable income up to $79,900, the 4.75% rate applying to income between $79,900 and $181,650, and the 5.99% rate for income exceeding $181,650. These tax brackets are adjusted annually for inflation.

Employees in Rhode Island complete a state-specific withholding form, such as Form RI W-4. This form allows employees to specify their filing status and claim personal and dependency exemptions, which reduce their taxable income for state purposes. For 2025, the standard deduction amounts are $10,900 for single filers and married individuals filing separately, $21,800 for married filing jointly or qualifying widow(er)s, and $16,350 for heads of household. A personal exemption of $5,100 per eligible individual can also be claimed for the 2025 tax year.

Employers refer to specific guidelines and tables provided by the Rhode Island Division of Taxation to calculate the correct amount of state income tax withholding. These guidelines ensure that the proper amount is withheld based on the employee’s RI W-4 and the current state tax laws.

Other Required Payroll Deductions

Beyond federal and state income taxes, other mandatory deductions are taken from a paycheck. These include Federal Insurance Contributions Act (FICA) taxes, which fund Social Security and Medicare programs. FICA taxes are split between the employee and the employer, with each paying a portion.

For 2025, the Social Security tax, also known as Old-Age, Survivors, and Disability Insurance (OASDI), is 6.2% of an employee’s gross wages, up to a wage base limit of $176,100. This means that earnings above this annual limit are not subject to the Social Security tax. The Medicare tax, or Hospital Insurance (HI), is 1.45% of all covered earnings, with no wage base limit. An additional Medicare tax of 0.9% applies to earned income exceeding certain thresholds: $200,000 for single filers and heads of household, $250,000 for married couples filing jointly, and $125,000 for married individuals filing separately. Employers are required to withhold this additional Medicare tax once an employee’s wages surpass $200,000, regardless of their filing status.

Rhode Island also mandates a Temporary Disability Insurance (TDI) and Temporary Caregiver Insurance (TCI) deduction. This state-specific deduction provides wage replacement benefits for employees who are unable to work due to a non-work-related illness or injury, or to care for a family member. For 2025, the TDI contribution rate is 1.3% of wages, up to a taxable wage base of $89,200. The maximum annual contribution for TDI in 2025 is $1,159.60.

Additional Factors Affecting Your Paycheck

Beyond mandatory taxes, several other deductions can influence an employee’s net pay. These often fall into two categories: pre-tax and post-tax deductions, each with distinct impacts on taxable income.

Pre-tax deductions are subtracted from an employee’s gross pay before federal and, in most cases, state income taxes are calculated. This reduces the employee’s taxable income, leading to a lower overall tax liability. Common examples include contributions to employer-sponsored health insurance plans, traditional 401(k) or 403(b) retirement accounts, Flexible Spending Accounts (FSAs), and Health Savings Accounts (HSAs). While these deductions offer immediate tax savings, the funds are typically taxed when withdrawn in retirement or when used for non-qualified expenses.

Post-tax deductions, conversely, are taken from an employee’s paycheck after all applicable taxes have been withheld. These deductions do not reduce taxable income. Examples include contributions to Roth 401(k) accounts, union dues, charitable contributions made through payroll, and wage garnishments. Although post-tax deductions do not provide an immediate tax benefit, certain post-tax contributions, such as those to a Roth 401(k), may allow for tax-free withdrawals in retirement, provided certain conditions are met. Wage garnishments, such as for child support or student loan debt, are legally mandated deductions that occur after taxes are calculated.