Rhode Island employers must handle several payroll tax obligations: graduated 3.75%–5.99% state income tax withholding, SUI contributions (0.99%–9.79% on the first $29,200 per employee), plus all federal payroll taxes (FICA at 7.65%, FUTA at 0.6% on the first $7,000). New employers pay an SUI rate of 1.21%.
Table of Contents
Overview: Rhode Island Payroll Tax Landscape
Running payroll in Rhode Island means managing both state and federal tax obligations. Here is the complete picture of what Rhode Island employers owe:
| Tax | Who Pays | Rate | Wage Base |
|---|---|---|---|
| Rhode Island Income Tax | Employee (employer withholds) | graduated 3.75%–5.99% | All wages |
| Rhode Island SUI | Employer | 0.99%–9.79% | $29,200 |
| Social Security (FICA) | Split 50/50 | 6.2% each | $176,100 |
| Medicare (FICA) | Split 50/50 | 1.45% each | No limit |
| FUTA | Employer | 0.6% (after credit) | $7,000 |
State Income Tax: graduated 3.75%–5.99%
Rhode Island has a progressive income tax with three brackets ranging from 3.75% to 5.99%. The withholding structure is relatively straightforward.
As an employer, you are responsible for withholding Rhode Island state income tax from every employee’s paycheck based on the withholding tables published by the Rhode Island Division of Taxation. You must remit these withholdings on the schedule assigned by the state — typically monthly or quarterly depending on your total tax liability.
For details, visit the Rhode Island Division of Taxation website.
💼 From the Payroll Desk
Rhode Island’s TDI (Temporary Disability Insurance) and TCI (Temporary Caregiver Insurance) deductions are the most commonly missed payroll items we see. These are employee-side deductions you must withhold and remit — failing to do so creates a liability for the employer.
State Unemployment Insurance (SUI)
Rhode Island SUI is an employer-paid tax on the first $29,200 of each employee’s wages per year. New employers pay 1.21%. Experienced employers are rated between 0.99%–9.79% based on their claims history.
SUI is administered by the Rhode Island Department of Labor and Training. You must register for an SUI account when you hire your first employee and file quarterly wage reports.
For a detailed breakdown, see our Rhode Island SUI Rates 2026 guide.
Federal Payroll Taxes
On top of Rhode Island state obligations, every employer must handle federal payroll taxes:
- FICA (Social Security + Medicare): 7.65% employer share, 7.65% employee share. Social Security applies to the first $176,100; Medicare has no cap.
- FUTA: 0.6% employer-only tax on the first $7,000 per employee (after state SUI credit).
- Federal Income Tax Withholding: Based on employee W-4 and IRS tables. Employer withholds but does not pay.
For a complete breakdown, see our Federal Payroll Tax Basics guide.
Filing Schedules and Deadlines
Key deadlines for Rhode Island employers:
- Federal 941: Quarterly — due by the last day of the month after each quarter
- Federal 940 (FUTA): Annual — due January 31
- Rhode Island SUI: Quarterly wage reports — due by the last day of the month after each quarter
- Rhode Island Income Tax Withholding: Monthly or quarterly, based on your liability
- W-2s: Due to employees by January 31, filed with SSA by January 31
Penalties for Late Filing and Payment
Late or missed payroll tax payments result in penalties at both the federal and state level:
- IRS: Failure-to-deposit penalties range from 2% to 15% depending on how late
- Rhode Island: State penalties vary but typically include interest on unpaid balances plus fixed or percentage-based penalty fees
- Trust fund penalty: The IRS can hold business owners personally liable for unpaid withholding taxes (the “Trust Fund Recovery Penalty”)
Frequently Asked Questions
What payroll taxes do Rhode Island employers pay?
Rhode Island employers pay federal payroll taxes (FICA, FUTA) and state unemployment insurance (SUI) on the first $29,200 of wages per employee. Employers also withhold Rhode Island state income tax (graduated 3.75%–5.99%) from employee paychecks.
What is the Rhode Island SUI wage base for 2026?
The Rhode Island SUI wage base for 2026 is $29,200. Employers pay SUI on the first $29,200 of each employee's wages per year.
What is the new employer SUI rate in Rhode Island?
New employers in Rhode Island typically pay an SUI rate of 1.21%. Experienced employer rates range from 0.99%–9.79% based on claims history.
When are Rhode Island payroll taxes due?
Rhode Island SUI taxes are typically filed quarterly. State income tax withholding is remitted on the schedule assigned by the Rhode Island Division of Taxation — monthly or quarterly based on liability. Check with the Rhode Island Division of Taxation for current due dates.
Does Rhode Island have local payroll taxes?
Some Rhode Island municipalities may impose local taxes. Check with local authorities for specific requirements.
Simplify Rhode Island Payroll
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Legal & Tax Disclaimer
This article is for general informational purposes only and does not constitute legal, tax, or professional advice. Employment laws, tax regulations, and compliance requirements change frequently. The information on this page reflects our understanding as of February 2026 and may not reflect recent changes in federal or Rhode Island state law.
Do not act or refrain from acting based solely on the information in this article. Always consult a qualified attorney, CPA, or HR professional familiar with Rhode Island law before making payroll or compliance decisions for your business.