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SB 2808

AN ACT RELATING TO TAXATION -- LEVY AND ASSESSMENT OF LOCAL TAXES -- TAX DEFERRAL PROGRAM

2026 Regular Session Introduced by John Burke and 7 co-sponsors

Allows eligible seniors, disabled individuals, and disabled veterans to defer single-family property taxes until death or transfer, creating a lien with 6% interest.

05/07/2026 Committee recommended measure be held for further study
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Bill Summary · SB 2808

Summary: SB 2808 (Rhode Island, 2026) – Tax Deferral Program

Purpose and Intent

SB 2808 proposes a statewide property tax deferral program for eligible homeowners—specifically senior citizens, disabled citizens, and disabled veterans. The goal is to ease the immediate burden of property taxes by allowing qualified homeowners to defer payment until a triggering event occurs (death or transfer of the property). The deferral creates a lien on the property and accrues interest, which is added to the final tax bill when the property is disposed of.

Key Provisions and Changes

  • Targeted Deferral:
    • Applies to property taxes on a single-family dwelling (including manufactured homes) owned and occupied by a senior citizen (age 62+), a totally disabled citizen (per Social Security Administration), or a totally disabled veteran (per Veterans Administration).
  • Trigger for Repayment:
    • Deferral extends until the property is disposed of due to death of all qualified owners, or by transfer/conveyance.
  • Lien and Interest:
    • Deferred taxes become a lien on the real estate.
    • Interest at 6% annually accrues during the deferral period and is added to the final tax bill upon disposition.
    • The city or town must file a lien notice in its land evidence records.
  • Eligibility Restrictions:
    • Ineligible if the dwelling has a reverse mortgage.
    • Ineligible if the dwelling has less than 20% equity.
  • Administration and Oversight:
    • The State Treasurer’s office (Office of the General Treasurer) will establish requirements, verification, and application procedures for municipalities participating in the program.
    • If a deferral is granted but later discovered to be filed in bad faith, the owner may be assessed a delinquency penalty for nonpayment.
  • Reporting Requirement:
    • Tax collectors must certify to the Director of Finance, by January 31 of each year, the total amount of supplemental roll property tax deferral claims submitted.
  • Exclusions:
    • The deferral does not apply to property taxes paid through escrow accounts.
  • Funding:
    • The State must appropriate $2,000,000 for each fiscal year beginning in 2027 to fund the deferrals.
    • Administration of the funds is handled by the Office of the General Treasurer.

Who Would Be Affected

  • Eligible Homeowners:
    • Senior citizens (62+), totally disabled citizens, and totally disabled veterans who own and occupy a single-family dwelling or manufactured home meeting equity requirements.
  • Local Governments:
    • Rhode Island cities and towns that administer property taxes and process deferral claims.
  • State Agencies:
    • Office of the General Treasurer administers the program; Department of Finance receives annual certification data from tax collectors.

Procedural and Timeline Details

  • Effective Date: Upon passage.
  • Annual Certification: By January 31 each year, local tax collectors certify the total supplemental roll property tax deferral claims to the Director of Finance.
  • Funding Timeline: Annual $2 million appropriation begins in fiscal year 2027 and continues thereafter.
  • Administration: Requirements, verification procedures, and application processes to be established by the State Treasurer’s office.
  • Penalties: Delinquency penalties may be imposed if deferrals are granted for claims filed in bad faith.

Potential Impacts and Considerations

  • Tax Burden Shifting: Deferred taxes will eventually be paid with interest, impacting the estate or heirs upon disposition.
  • Equity and Access: Aims to improve housing stability for seniors, disabled individuals, and veterans by reducing immediate tax burdens.
  • Property Value and Equity Constraints: The 20% equity and reverse mortgage exclusions limit participation; households with low equity or encumbered titles would not benefit.
  • Fiscal Note: State funding is explicitly provided to support deferrals, indicating a defined cost to the state beginning in FY 2027.
  • Interim Impacts: Localities must implement procedures and lien filing, with potential administrative workload and data reporting obligations.

This bill would create a structured framework for deferring property tax payments for specific vulnerable groups, financed by state appropriations and administered through the treasurer’s office, with defined eligibility criteria and safeguards.

Compiled from official sources — confirm details with the bill’s official record.

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