Rhode Island tipped wage calculator: $3.89 meets $17.00
Rhode Island’s minimum rises to $17.00 on January 1, 2027, but the tipped cash wage in § 28-12-5 stays at $3.89, so the tip credit grows to $13.11. Tips stay taxable on the RI-1040.
A cash wage frozen since 2017
R.I. Gen. Laws § 28-12-5 lets restaurants, hotels and other industries (except taxicabs) count gratuities toward the minimum, but sets a cash floor that rose in fifty-cent steps to $3.89 on January 1, 2017 and has not moved since. Meanwhile § 28-12-3 lifted the minimum from $13.00 in 2023 to $16.00 in 2026 and $17.00 in 2027.
Rhode Island figures
| Cash wage / minimum | $3.89 / $16.00 |
|---|---|
| In force | July 1, 2026 – December 31, 2026 |
| Next change | January 1, 2027: $3.89 / $17.00 |
| Tipped threshold | More than $30 a month in tips |
| Tips on the 2025 return | tips stay taxable in this state. Division of Taxation: tip and overtime exemptions are below-the-line federal deductions with “No RI impact.” Source: Rhode Island Division of Taxation |
| Tips on the 2026 return | tips stay taxable in this state. Unchanged. Source: Rhode Island Division of Taxation |
No Rhode Island impact
The Division of Taxation told preparers in January 2026 that the tip and overtime exemptions are below-the-line federal deductions with “No RI impact,” so there is nothing to subtract or add back on the Rhode Island return.
A Providence server
Federal savings on $21,000: $2,470; Rhode Island taxes the tips. Thirty hours at $3.89 pay $117; with $160 of tips the employer owes $203 to reach $480.
Check a Rhode Island workweek
Where these figures come from
- Rhode Island Division of Taxation · Rhode Island Department of Labor and Training
- RI Division of Taxation presentation to NATP (Jan. 8, 2026): H.R. 1 Rhode Island response (2026-01-08)
- Minimum Wages for Tipped Employees (table by state) (2026-07-01)
- Minimum Wage (R.I. Gen. Laws § 28-12-3) and § 28-12-5 Employees receiving gratuities (2026)
Federal rules: how the deduction works. Nearby: Connecticut, Massachusetts.
Figures verified against primary sources on