RI · #44 by population

Buying a home in Rhode Island

Costs and rules that are specific to Rhode Island. Main city: Providence.

In short

Rhode Island taxes property sales through its real estate conveyance tax, does not require an attorney at closing and requires a seller disclosure form. It allows both court and out-of-court foreclosure and is not a community property state.

Calculate for Rhode Island

If you buy

Rhode Island state transfer tax

Real estate conveyance tax (R.I. Gen. Laws 44-25-1): $3.75 for each $500 of price or fractional part of $500; residential property adds a second $3.75 per $500 on the part above $800,000 (threshold indexed to inflation from 2026).

Price$455,700
State transfer taxnot computed
Who paysThe seller

Default price: the Rhode Island median value of owner-occupied homes, $455,700 (Census ACS 2024). Not computed: Basic tax = $3.75 x number of $500 blocks (fraction rounds up) on the whole price, including any lien that stays on the property; applies to deeds for more than $100. For residential property, add a second tax of $3.75 per $500 block on the part of the price above $800,000. The statute adjusts the $800,000 threshold with CPI-U from tax years beginning January 1, 2026 and the adjusted figure is not in the statute; check with the Division of Taxation. Example at $900,000 with an $800,000 threshold: $6,750 + $750 = $7,500. Who pays: By law, in the absence of an agreement to the contrary, the seller (grantor) pays (44-25-1(a)); the purchase contract can shift the cost. Not included: county and city transfer taxes, recording fees, title insurance and lender charges. Rhode Island transfer tax guide · all 50 states.

If you sell

Capital gain and the federal tax on it

Same federal rule in every state: Section 121 of the Internal Revenue Code excludes up to $250,000 of gain on a main home ($500,000 for a married couple filing jointly).

Capital gain$350,000
Section 121 exclusion$250,000 (limit $250,000)
Taxable gain$100,000
Type of gainLong-term (owned over 1 year), 15% chosen
Federal tax on the gain$15,000

Section 121 excludes $250,000; the rest is taxable.

Gain = sale price minus your adjusted basis (purchase price, buying costs and improvements); selling expenses reduce it (IRS Publication 523). Long-term rates for sales in 2026, by taxable income including the gain (IRS Rev. Proc. 2025-32, section 4.03): 0% up to $49,450 single or $98,900 married filing jointly, 15% up to $545,500 single or $613,700 jointly, 20% above. Not included: Rhode Island state income tax on the gain (not computed), the net investment income tax, depreciation recapture on a rental or home office, and the reduced exclusion for an early sale. Agent commissions are negotiated and never set by law. Capital gains on a home sale.

Rhode Island in short

Is there a real estate transfer tax in Rhode Island?

Rhode Island taxes real estate sales through its conveyance tax of $3.75 for each $500 of the price, or part of it, which is $3,000 on a $400,000 home. Unless the parties agree otherwise the seller pays, and residential sales above $800,000 owe a second layer.

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What closing costs does Rhode Island law set?

Rhode Island has no official typical closing-cost total. The conveyance tax is $3.75 per $500 of price ($3,000 on a $400,000 sale), paid by the seller unless the contract says otherwise, and recording a warranty deed costs $80 and a mortgage $60.

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How is property tax calculated in Rhode Island?

In Rhode Island each city or town assesses and taxes property. Providence's 2025 rate is $8.40 per $1,000 of assessed value for an owner-occupied single-family home ($14.60 non-owner-occupied), or $3,360 a year on a $400,000 assessment. To appeal, file with the local assessor on or before November 15 (R.I. Gen.

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What is the deadline to appeal a property tax assessment in Rhode Island?

In Rhode Island, file your assessment appeal with the local assessor on or before November 15 and not less than 90 days after the first tax payment is due (R.I. Gen.

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Do you need a real estate attorney to close in Rhode Island?

The Rhode Island statutes read do not say a buyer or seller must hire an attorney to close on a home, though the practice of law includes drafting instruments usually prepared by attorneys (R.I. Gen. Laws 11-27-2) and the Title Insurers Act describes closings run by title insurance agents.

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What must a home seller disclose in Rhode Island?

A Rhode Island seller must give the buyer a written disclosure of all known deficient conditions before any agreement to transfer is signed (R.I. Gen. Laws 5-20.8-2). A violation does not void the sale but carries a civil penalty of up to $1,000 per violation by a seller or agent.

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How does foreclosure work in Rhode Island?

A Rhode Island mortgage that includes the statutory power of sale lets the lender sell the home at a public auction without a court case.

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What first-time home buyer programs does Rhode Island offer?

In Rhode Island, RIHousing offers three down payment programs for first-time buyers: 15kDPA, a $15,000 zero-interest loan. Extra Assistance, up to $20,000. And FirstGenHomeRI, $25,000 that is forgiven after five years. Each requires a RIHousing first mortgage and a homebuyer education course.

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How much tax when you sell a home in Rhode Island?

The federal rule is the same in Rhode Island as in every state: if you owned and lived in the home as your main home for at least 2 of the last 5 years, the first $250,000 of gain is excluded, $500,000 for a married couple filing jointly (Section 121, IRS Publication 523). Bought $400,000, sold $750,000: a single owner has $100,000 of taxable gain, $15,000 of federal tax at the 15% long-term rate; a couple filing jointly owes nothing. Rhode Island income tax on the gain is not computed here.

Capital gains on a home sale

Rhode Island guides

Providence

Buying a home in Providence, Rhode Island

Professionals in Rhode Island

All states · Federal guides