The state of Rhode Island subjects most forms of income to state income tax. This includes net earnings from self-employment as well as wages and salaries from employment. Unearned income such as unemployment compensation and rental property income is also taxable. For complete instructions regarding taxable income, see the Rhode Island Division of Taxation website.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf  

Most states have a set of filing requirements that will let you know if you are required to file a state return or not. In Rhode Island, however, if you are required to file a federal income tax return with the Internal Revenue Service, then you are automatically required to file a Rhode Island state tax return as well. You must file your 2010 tax return no later than April 18, 2011.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf 

In order to prepare your Rhode Island tax return, the first thing you need to do is assemble all the relevant tax information you have. This will help to save time once you begin completing your forms. You will need the following:

1. Your Social Security number
2. Your complete mailing address
3. Your spouse's name and Social Security number, if you are filing a joint tax return
4. Proof of your earned income for the year, such as your Form W-2 or Form 1099 - If you work for yourself, you will need to add up your gross earnings and subtract any appropriate business expenses.
5. Proof of your taxable unearned income - This will include various kinds of income, such as interest and dividends, unemployment compensation, lottery winnings, etc.
6. The total amount of state income taxes you have already paid during the tax year - If you are employed, this will be shown on your Form W-2 as state taxes withheld. If you are self-employed, this will be any estimated tax payments that you already made.
7. A copy of your federal income tax return, if you are filing onehttp://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf
   

If you are filing a federal tax return, it's a good idea to complete that form before you begin working on your Rhode Island return. You will need some of the information from your federal form on your state form. If you will not be filing a federal income tax return, you may want to consult a tax professional to help you calculate your federal adjusted gross income, or AGI. That amount will be the starting point of the completion of your state tax form.http://www.irs.gov/pub/irs-pdf/f1040.pdf

Now you need to obtain your state tax return. If you have Internet access, you can download a copy of the Form RI-1040 "Rhode Island Resident Individual Income Tax Return" and the accompanying instructions from the Rhode Island Department of Taxation website. If you do not have access to the Internet, you can usually pick up a paper copy at your local library.http://www.tax.ri.gov/forms/2010/Income/2010%20RI-1040.pdf

Should you prefer to file your return electronically, you can do so easily if you are using tax preparation software or a tax preparation website. These services allow you to select your state return and file it along with your federal return for an additional fee.http://www.tax.ri.gov/misc/efile.php 

If you meet certain income requirements, you may qualify to file your return electronically for free via the state's Free File program. Electronic filing, or e-filing, is usually the most convenient option since you are able to directly import the information you need from your federal return.http://www.tax.ri.gov/misc/efile.php 

The directions below are for preparing a separate state tax return. To file an electronic return, you simply follow the program prompts and input information as needed. If you will be printing the form out to complete it by hand, be sure to write legibly and use black ink to avoid any processing delays.http://www.tax.ri.gov/forms/2010/Income/2010%20RI-1040.pdf

Begin your return by entering your full name and Social Security number, as well as your spouse's if applicable. Complete the address section and select the appropriate filing status. Now stop and read the form instructions carefully before proceeding. The instructions will explain any income adjustments you may need to make and any state credits you may qualify to claim.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf

To finish your return, take out your IRS Form 1040. Find the amount of your federal adjusted gross income. If you need help locating this total, the Rhode Island state return explains where to find it. Enter that on line 1 of your state return. From here, you need to make any necessary modifications to your income as described in the state instructions and enter the number of dependent exemptions you are claiming. This will calculate your taxable income.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf  

To assess the amount of tax you may owe, consult the tax tables located in the instructions to find the total tax owed on your taxable income. Enter this as the amount of your tax on line 8. After adding in any applicable alternative minimum tax, you will subtract the amount of state income tax you have already paid and any state credits you qualify to claim.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf  

The amount that is left will be either an overpayment, which entitles you to a refund, or an underpayment, which results in a tax balance you will need to pay in. Sign and date the return and have your spouse do the same. Make a copy of the return for your personal records.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf 

If you are due a refund, you will only need to mail the completed return to the address stated on the form. If you owe a balance due, you will need to include a check or money order for your total balance and send it along with the form to the same address. Should you decide to file electronically, you will usually be given the option to pay your balance with a credit or debit card.http://www.tax.ri.gov/forms/2010/1040C/2010%20RI-1040C%20Instructions.pdf 

Be sure to submit your return and your payment by April 18, 2011, to avoid late-filing penalties or compound interest. If you will be unable to complete your return before the deadline, be sure to learn about how to get a state tax extension in Rhode Island.