(a)  Each January 1 the tax administrator shall compute the rate of interest to be in effect for that calendar year by reference to the prime rate, which was in effect on October 1 of the preceding year. The term “prime rate” shall mean the predominant prime rate quoted by commercial banks to large businesses as determined by the board of governors of the Federal Reserve System.

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Terms Used In Rhode Island General Laws 44-1-7.1

  • Federal Reserve System: The central bank of the United States. The Fed, as it is commonly called, regulates the U.S. monetary and financial system. The Federal Reserve System is composed of a central governmental agency in Washington, D.C. (the Board of Governors) and twelve regional Federal Reserve Banks in major cities throughout the United States. Source: OCC
  • Statute: A law passed by a legislature.

(b)  Notwithstanding any general or specific statute to the contrary, overpayments of state taxes or surcharges that are remitted to the tax division pursuant to § 39-21.1-14, shall bear interest at the prime rate as defined in § 44-1-7.1(a) from the date the tax or the surcharge that is referenced in this provision was paid, or from the date including any extensions of the date the tax became due, whichever of the dates occurs later.

(c)  If any overpayment of state tax is refunded within ninety (90) days after the last date prescribed (or permitted by extension of time) for filing the return of the tax, or within ninety (90) days after the return is in fact filed, no interest shall be allowed under this section on the overpayment.

(d)  For the purposes of this section, if any overpayment of state tax results from a carry-back of a net operating loss, the overpayment is deemed not to have been made prior to the close of the taxable year in which the net operating loss arises.

(e)  If any overpayment of a surcharge referenced in subsection (b) of this section is refunded within ninety (90) days after notification of overpayment of the surcharge, no interest shall be allowed under this section on the overpayment.

History of Section.
P.L. 1982, ch. 159, § 1; P.L. 1983, ch. 104, § 1; P.L. 1984, ch. 289, § 1; P.L. 2006, ch. 246, art. 21, § 3; P.L. 2007, ch. 73, art. 4, § 3; P.L. 2008, ch. 475, § 14.