If you are getting ready to sell a home in Newport County or the East Bay, the state's share of your closing got bigger. For closings on or after October 1, 2025, Rhode Island's real estate conveyance tax rose from $2.30 to $3.75 for every $500 of the sale price. That is a 63 percent increase. On top of it, a residential sale above $824,000 in 2026 owes a second layer of tax on every dollar over that line. On a $1.2 million sale, the state now collects $11,820 at closing, and by default the seller pays it.
If you last sold a home years ago, the numbers in your head are out of date. Here is how the tax works now, what it costs at the prices our towns actually trade at, and what to budget before you list.
What changed on October 1, 2025
The conveyance tax is Rhode Island's transfer tax on real estate. It is charged on the full sale price in $500 increments and collected when the deed is recorded. The Rhode Island Division of Taxation confirmed the new rates in an August 2025 advisory: for closings on or after October 1, 2025, the base rate is $3.75 per $500, up from $2.30. The closing date is what controls, not the date you signed the purchase and sale agreement.
In percentage terms, the base tax moved from 0.46 percent of the sale price to 0.75 percent. Lawmakers passed the increase in the state's fiscal 2026 budget and directed the added revenue to housing and homelessness programs.
Two mechanics worth knowing:
- The tax counts in $500 steps, and any fraction of $500 rounds up to a full step.
- The seller pays unless the contract says otherwise. Shifting it to a buyer is possible on paper and rare in practice.
The second tier and the $824,000 line
Rhode Island added a second layer to this tax in 2022. Since January 1, 2022, residential sales above a set threshold have paid an additional conveyance tax, charged only on the portion of the price above the line. The threshold started at $800,000 and adjusts each year with the Consumer Price Index. By statute it can only move up, rounded up to the nearest $5.
The October 2025 change raised the second-tier rate too, from an extra $2.30 to an extra $3.75 per $500. For calendar year 2026, the threshold is $824,000.
Put the two layers together and every dollar above $824,000 is taxed at $7.50 per $500. That is 1.5 percent on the top slice of the price.
Why this lands on Newport County and the East Bay
A trigger at $824,000 might sound like a problem for a handful of estates. At our price points it is closer to the middle of the market:
- Newport's median sale price was about $980,000 in July 2026, per Houzeo's MLS-based market data, and single-family homes averaged higher than that.
- Newport County overall posted a median around $795,000 for the three months ending May 2026, per Redfin.
- In Barrington, Zillow put the typical home value near $808,000 as of mid-2026.
So the second tier is not an edge case here. A median sale in Newport crosses it. A large share of Barrington sits within reach of it. Much of the waterfront in Jamestown, Little Compton, Portsmouth, Bristol, and Warren trades above it. For the bigger picture on where prices are heading on both sides of the state line, see our 2026 housing forecast for the South Coast.
Example one: a $650,000 sale in Bristol, Warren, or Tiverton
Plenty of East Bay homes still sell below the threshold, and those sales pay only the base rate. On a $650,000 sale:
- $650,000 breaks into 1,300 increments of $500.
- 1,300 increments times $3.75 comes to $4,875.
That is the entire state conveyance tax on this sale, about 0.75 percent of the price. The same closing before October 1, 2025 would have cost $2,990. The increase alone is $1,885. Real money, but the structure stays simple because no second tier applies.
Example two: a $1.2 million sale in Newport, Jamestown, Little Compton, or Barrington
Now a price these towns see every week. A $1.2 million residential sale closing in 2026 pays two layers:
- Base tax: 2,400 increments times $3.75 is $9,000.
- Second tier: $1,200,000 minus $824,000 leaves $376,000 above the line. That is 752 increments times $3.75, another $2,820.
- Total conveyance tax: $11,820, just under 1 percent of the sale price.
For contrast, the same sale that closed in September 2025 owed $7,360 under the old rates and the old $800,000 threshold. The same sale closed in 2021 owed $5,520 flat, because the second tier did not exist yet.
Even the Newport median tells the story. A $980,000 sale in 2026 owes $7,350 in base tax plus $1,170 on the $156,000 above the threshold. Total: $8,520.
If you have not sold since before 2022, plan for a bigger number
A seller who last closed in 2019 remembers a single conveyance line at $2.30 per $500 and nothing else. On the $1.2 million example, that seller paid $5,520. Today the identical sale pays $11,820, more than double, and nothing about the house changed. The tax did.
This is exactly the line item that surprises people at the closing table. It does not appear in the list price, and a net sheet built on the old rates will simply be wrong. When we prepare a seller net sheet, the conveyance tax is calculated at the current rate and the current-year threshold, so the number you plan around is the number you sign.
The rest of a Rhode Island seller's closing costs
The conveyance tax is the biggest state charge at closing, but it is not the only line on the settlement statement. Rhode Island is an attorney-closing state, so a licensed attorney conducts the closing itself. Typical seller-side items include:
- Real estate commission, as negotiated in your listing agreement.
- Closing attorney and document preparation fees.
- Recording fees for the mortgage discharge and related documents.
- Prorated property taxes, plus any fire district or utility balances.
- Rhode Island's mandatory seller disclosure form. It costs nothing, but it is required, and it should be completed carefully.
For sellers comparing across the border: the Massachusetts deeds excise runs $4.56 per $1,000 statewide, which is $2.28 per $500, well under Rhode Island's new base rate. And island sales in Massachusetts carry an extra charge of their own, which we covered in our guide to the Martha's Vineyard land bank fee.
A pending bill to watch
The statewide increase may not be the last word. Senate bill S2697, introduced on February 27, 2026, would let a city or town impose its own conveyance tax of $10 per $500 on residential sales above $900,000. As of this writing the bill is pending in a Senate committee and is not law. If a version of it ever passes, seller costs could begin to vary town by town. Before you sign anything, confirm the current rates with your closing attorney or with the Division of Taxation.
Know your number before you list
None of this is a reason to shelve a sale. It is a reason to plan with real figures instead of the ones from your last closing. If you are thinking about selling in Newport County, the East Bay, or across the line on the South Coast, start with an accurate picture of what your home is worth and what you will actually net. Request a free home valuation and we will build your full seller net sheet, conveyance tax included, at today's rates.
