Rhode Island Code of Regulations
Title 280 - Department of Revenue
Chapter 20 - Division of Taxation
Subchapter 25 - Business Corporation Tax
Part 10 - Combined Reporting (280-RICR-20-25-10)
Section 280-RICR-20-25-10.23 - Appendix I - Combined Reporting Calculation

1. Combine the federal taxable income of all members of the combined group.

2. Combine all deductions of all members of the combined group, including NOLs in accordance with this regulation.

3. Combine all the additions of all members of the combined group.

4. Net the combined additions and the combined deductions against the combined federal taxable income of all members of the combined group. The result is the adjusted taxable income of the combined group for Rhode Island corporate income tax purposes.

5. Combine the receipts of all members of the combined group using the Finnigan method. Calculate the apportionment ratio for the combined group. Use, as the numerator, all Rhode Island receipts - regardless of whether a group member has nexus in Rhode Island. Use, as the denominator, everywhere receipts. (Divide the numerator by the denominator to arrive at an apportionment ratio.)

6. Compute the apportioned Rhode Island taxable income of the combined group by multiplying adjusted taxable income by the combined apportionment ratio.

7. Compute and combine Rhode Island adjustments, including research and development adjustments, pollution control and hazardous waste adjustment, and capital investment deduction. Subtract total such adjustments from apportioned Rhode Island taxable income computed in § 10.23(A)(6) of this Part to arrive at Rhode Island adjusted taxable income.

8. Multiply result from § 10.23(A)(7) of this Part by applicable tax rate. (For tax year 2015, applicable tax rate is seven percent (7%)).

9. Calculate allowable credits in accordance with this regulation.

10. Subtract result in § 10.23(A)(9) of this Part (above) from the result in § 10.23(A)(8) of this Part (above). This is the tax due under combined reporting, before annual corporate minimum tax. (See § 10.23(A)(11) of this Part.)

11. For purposes of the minimum tax, determine the number of members of the combined group that have Rhode Island nexus. Multiply that number by the amount of the annual corporate minimum tax under R.I. Gen. Laws § 44-11-2(e). Compare that sum to the amount of net tax liability (after credits) from § 10.23(A)(10) of this Part. Pay whichever amount is higher.