Bill Text: HI SB3280 | 2024 | Regular Session | Introduced
Bill Title: Relating To Taxation.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced - Dead) 2024-01-29 - Referred to WAM. [SB3280 Detail]
Download: Hawaii-2024-SB3280-Introduced.html
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THE SENATE |
S.B. NO. |
3280 |
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THIRTY-SECOND LEGISLATURE, 2024 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO TAXATION.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
""Cost-of-living adjustment
factor" means a factor calculated by adding 1.0 to the percentage change,
from July of the preceding calendar year to July of the current calendar year,
in the United States Department of Labor's:
(1) Urban
Hawaii Consumer Price Index for all items; or
(2) Chained Consumer Price Index for All Urban Consumers, if the Urban Hawaii Consumer Price Index is discontinued."
SECTION 2. Section 235-2.4, Hawaii Revised Statutes, is amended as follows:
1. By amending subsection (a) to read:
"(a) Section 63 (with respect to taxable income defined) of the Internal Revenue Code shall be operative for the purposes of this chapter, subject to the following:
(1) Section 63(c)(1)(B) (relating to the additional standard deduction), 63(c)(1)(C) (relating to the real property tax deduction), 63(c)(1)(D) (relating to the disaster loss deduction), 63(c)(1)(E) (relating to the motor vehicle sales tax deduction), 63(c)(4) (relating to inflation adjustments), 63(c)(7) (defining the real property tax deduction), 63(c)(8) (defining the disaster loss deduction), 63(c)(9) (defining the motor vehicle sales tax deduction), and 63(f) (relating to additional amounts for the aged or blind) of the Internal Revenue Code shall not be operative for purposes of this chapter;
(2) Section 63(c)(2) (relating to the basic
standard deduction) of the Internal Revenue Code shall be operative[, except
that the standard deduction amounts provided therein shall instead mean:
(A) $4,400 in the case of:
(i) A joint return as provided by
section 235-93; or
(ii) A surviving spouse (as defined in
section 2(a) of the Internal Revenue Code);
(B) $3,212 in the case of a head of
household (as defined in section 2(b) of the Internal Revenue Code);
(C) $2,200 in the case of an individual
who is not married and who is not a surviving spouse or head of household; or
(D) $2,200 in the case of a married
individual filing a separate return;]; provided that:
(A) The standard deduction amounts provided therein shall instead
mean:
(i) $10,000 in the case of a joint return, as provided by section 235-93, or a surviving spouse, as defined in section 2(a) of the Internal Revenue Code;
(ii) $7,500 in the case of a head of household, as defined in section 2(b) of the Internal Revenue Code;
(iii) $5,000 in the case of an individual who is not married and who is not a surviving spouse or head of household; or
(iv) $5,000 in the case of a married individual filing a separate return; and
(B) For each taxable year beginning after December 31, 2024,
the director, no later than December 15 of the preceding calendar year, shall
recompute the standard deduction amounts by multiplying the dollar amounts for
the preceding taxable year by the cost-of-living adjustment factor, if the
cost-of-living adjustment factor is greater than zero, and rounding off the
resulting product to the nearest $1; provided that if the cost of living
adjustment factor is less than or equal to zero in a given year, then no adjustment
will occur in the following year;
(3) Section 63(c)(5) (limiting the basic standard deduction in the case of certain dependents) of the Internal Revenue Code shall be operative, except that the limitation shall be the greater of $500 or the individual's earned income; and
(4) The standard deduction amount for nonresidents shall be calculated pursuant to section 235-5."
2. By amending subsection (c) to read:
"(c) Section 68 (with respect to the overall
limitation on itemized deductions) of the Internal Revenue Code shall be
operative; provided that [the]:
(1) [Thresholds] The thresholds
shall be [those] the applicable amounts under section 68(b)(1) of the
Internal Revenue Code that were operative for federal tax year [2009;
and] 2013;
(2) For
each taxable year beginning after December 31, 2024, the director of taxation,
no later than December 15 of the preceding calendar year, shall recompute
the threshold amounts by multiplying the dollar amounts for the preceding
taxable year by the cost-of-living adjustment factor, if the cost of living
adjustment factor is greater than zero, and rounding off the resulting product
to the nearest $1; provided that if the cost-of-living adjustment factor is
less than or equal to zero in a given year, then no adjustment will occur in
the following year; and
[(2)]
(3) Suspension
in section 68(f) shall not be operative for purposes of this chapter."
3. By amending subsection (k) to read:
"(k) Section 164 (with respect to taxes) of the Internal Revenue Code shall be operative for the purposes of this chapter, except that:
(1) Section 164(b)(6)(B) (limiting the deduction
for state and local taxes) shall not be operative for the purposes of this
chapter;
(2) The deductions under section 164(a)(3) and
(b)(5) shall not be operative for corporate taxpayers [and shall be
operative only for the following individual taxpayers:
(A) A taxpayer filing a single return or a married
person filing separately with a federal adjusted gross income of less than
$100,000;
(B) A taxpayer filing as a head of household
with a federal adjusted gross income of less than $150,000; and
(C) A taxpayer filing a joint return or
as a surviving spouse with a federal adjusted gross income of less than
$200,000]; and
(3) Section 164(a)(3) shall not be operative for any amounts for which the credit under section 235-55 has been claimed."
SECTION 3. Section 235-51, Hawaii Revised Statutes, is amended to read as follows:
"§235-51 Tax imposed on individuals; rates. (a)
There is hereby imposed on the taxable income of every:
(1) Taxpayer who files a joint return under
section 235‑93; and
(2) Surviving spouse,
a tax determined in accordance with
the following table:
[In
the case of any taxable year beginning after December 31, 2017:
If the taxable income is: The tax shall be:
Not over $4,800 1.40% of taxable income
Over $4,800 but $67.00 plus 3.20% of
not over $9,600 excess over $4,800
Over $9,600 but $221.00 plus 5.50% of
not over $19,200 excess over $9,600
Over $19,200 but $749.00 plus 6.40% of
not over $28,800 excess over $19,200
Over $28,800 but $1,363.00 plus 6.80% of
not over $38,400 excess over $28,800
Over $38,400 but $2,016.00 plus 7.20% of
not over $48,000 excess over $38,400
Over $48,000 but $2,707.00 plus 7.60% of
not over $72,000 excess over $48,000
Over $72,000 but $4,531.00 plus 7.90% of
not
over $96,000 excess
over $72,000
Over $96,000 but $6,427.00 plus 8.25% of
not over $300,000 excess over $96,000
Over $300,000 but $23,257.00 plus 9.00% of
not over $350,000 excess over $300,000
Over $350,000 but $27,757.00 plus 10.00% of
not over $400,000 excess over $350,000
Over $400,000 $32,757.00 plus 11.00% of
excess
over $400,000.
In
the case of any taxable year beginning after December 31, 2023:
If the taxable income is: The tax shall be:
Not over $5,126 1.40% of taxable income
Over $5,126 but $72.00 plus 3.20% of
not over $10,253 excess over $5,126
Over $10,253 but $236.00 plus 5.50% of
not over $20,506 excess over $10,253
Over $20,506 but $800.00 plus 6.40% of
not over $30,758 excess over $20,506
Over $30,758 but $1,456.00 plus 6.80% of
not over $41,011 excess over $30,758
Over $41,011 but $2,153.00 plus 7.20% of
not over $51,264 excess over $41,011
Over $51,264 but $2,891.00 plus 7.60% of
not over $76,896 excess over $51,264
Over $76,896 but $4,839.00 plus 7.90% of
not over $102,528 excess over $76,896
Over $102,528 but $6,864.00 plus 8.25% of
not over $320,400 excess over $102,528
Over $320,400 but $24,838.00 plus 9.00% of
not over $373,800 excess over $320,400
Over $373,800 but $29,644.00 plus 10.00% of
not over $427,200 excess over $373,800
Over $427,200 $34,984.00 plus 11.00% of
excess
over $427,200.
(b) There is hereby imposed on the taxable income
of every head of a household a tax determined in accordance with the following
table:
[In
the case of any taxable year beginning after December 31, 2017:
If the taxable income is: The tax shall be:
Not over $3,600 1.40% of taxable income
Over $3,600 but $50.00 plus 3.20% of
not over $7,200 excess
over $3,600
Over $7,200 but $166.00 plus 5.50% of
not over $14,400 excess over $7,200
Over $14,400 but $562.00 plus 6.40%
of
not over $21,600 excess over
$14,400
Over $21,600 but $1,022.00 plus
6.80% of
not over $28,800 excess over
$21,600
Over $28,800 but $1,512.00 plus
7.20% of
not over $36,000 excess over
$28,800
Over $36,000 but $2,030.00 plus 7.60% of
not over $54,000 excess over $36,000
Over $54,000 but $3,398.00 plus 7.90% of
not over $72,000 excess over $54,000
Over $72,000 but $4,820.00 plus 8.25% of
not over $225,000 excess over $72,000
Over $225,000 but $17,443.00 plus 9.00% of
not over $262,500 excess over $225,000
Over $262,500 but $20,818.00 plus 10.00% of
not over $300,000 excess over $262,500
Over $300,000 $24,568.00 plus 11.00% of
excess
over $300,000.]
In
the case of any taxable year beginning after December 31, 2023:
If the taxable income is: The tax shall be:
Not over $3,845 1.40% of taxable income
Over $3,845 but $54.00 plus 3.20% of
not over $7,690 excess over $3,845
Over $7,690 but $177.00 plus 5.50% of
not over $15,379 excess over $7,690
Over $15,379 but $600.00 plus 6.40% of
not over $23,069 excess over $15,379
Over $23,069 but $1,092.00 plus 6.80% of
not over $30,758 excess over $23,069
Over $30,758 but $1,615.00 plus 7.20% of
not over $38,448 excess over $30,758
Over $38,448 but $2,169.00 plus 7.60% of
not over $57,672 excess over $38,448
Over $57,672 but $3,630.00 plus 7.90% of
not over $76,896 excess over $57,672
Over $76,896 but $5,149.00 plus 8.25% of
not over $240,300 excess over $76,896
Over $240,300 but $18,630.00 plus 9.00% of
not over $280,350 excess over $240,300
Over $280,350 but $22,234.00 plus 10.00% of
not over $320,400 excess over $280,350
Over $320,400 $26,239.00 plus 11.00% of
excess
over $320,400.
(c) There is hereby imposed on the taxable income
of (1) every unmarried individual (other than a surviving spouse, or the head
of a household) and (2) on the taxable income of every married individual who
does not make a single return jointly with the individual's spouse under
section 235-93 a tax determined in accordance with the following table:
[In
the case of any taxable year beginning after December 31, 2017:
If the taxable income is: The tax shall be:
Not over $2,400 1.40% of taxable income
Over $2,400 but $34.00 plus 3.20% of
not over $4,800 excess over $2,400
Over $4,800 but $110.00 plus 5.50% of
not over $9,600 excess over $4,800
Over $9,600 but $374.00 plus 6.40% of
not over $14,400 excess over $9,600
Over $14,400 but $682.00 plus 6.80% of
not over $19,200 excess over $14,400
Over $19,200 but $1,008.00 plus 7.20% of
not over $24,000 excess over $19,200
Over $24,000 but $1,354.00 plus 7.60% of
not over $36,000 excess
over $24,000
Over $36,000 but $2,266.00 plus 7.90% of
not over $48,000 excess over $36,000
Over $48,000 but $3,214.00 plus 8.25% of
not over $150,000 excess over $48,000
Over $150,000 but $11,629.00 plus 9.00% of
not over $175,000 excess over $150,000
Over $175,000 but $13,879.00 plus 10.00% of
not over $200,000 excess over $175,000
Over $200,000 $16,379.00 plus 11.00% of
excess
over $200,000.]
In
the case of any taxable year beginning after December 31, 2023:
If the taxable income is: The tax shall be:
Not over $2,563 1.40% of taxable income
Over $2,563 but $36.00 plus 3.20% of
not over $5,126 excess over $2,563
Over $5,126 but $118.00 plus 5.50% of
not over $10,253 excess over $5,126
Over $10,253 but $400.00 plus 6.40% of
not over $15,379 excess over $10,253
Over $15,379 but $728.00 plus 6.80% of
not over $20,506 excess over $15,379
Over $20,506 but $1,077.00 plus 7.20% of
not over $25,632 excess over $20,506
Over $25,632 but $1,446.00 plus 7.60% of
not over $38,448 excess over $25,632
Over $38,448 but $2,420.00 plus 7.90% of
not over $51,264 excess over $38,448
Over $51,264 but $3,432.00 plus 8.25% of
not over $160,200 excess over $51,264
Over $160,200 but $12,419.00 plus 9.00% of
not over $186,900 excess over $160,200
Over $186,900 but $14,822.00 plus 10.00% of
not over $213,600 excess over $186,900
Over $213,600 $17,492.00 plus 11.00% of
excess
over $213,600.
(d) The tax imposed by section 235-2.45 on estates and trusts shall be determined in accordance with the following table:
In the case of any taxable year beginning after December 31, 2001:
If the taxable income is: The tax shall be:
Not over $2,000 1.40% of taxable income
Over $2,000 but $28.00 plus 3.20% of
not over $4,000 excess over $2,000
Over $4,000 but $92.00 plus 5.50% of
not over $8,000 excess over $4,000
Over $8,000 but $312.00 plus 6.40% of
not over $12,000 excess over $8,000
Over $12,000 but $568.00 plus 6.80% of
not over $16,000 excess over $12,000
Over $16,000 but $840.00 plus 7.20% of
not over $20,000 excess over $16,000
Over $20,000 but $1,128.00 plus 7.60% of
not over $30,000 excess over $20,000
Over $30,000 but $1,888.00 plus 7.90% of
not over $40,000 excess over $30,000
Over $40,000 $2,678.00 plus 8.25% of
excess over $40,000.
(e) Any taxpayer, other than a corporation, acting as a business entity in more than one state who is required by this chapter to file a return may elect to report and pay a tax of .5 per cent of the taxpayer's annual gross sales if the:
(1) Taxpayer's only activities in this State consist of sales;
(2) Taxpayer does not own or rent real estate or tangible personal property; and
(3) Taxpayer's annual gross sales in or into this State during the tax year is not in excess of $100,000.
(f) If a taxpayer has a net capital gain for any taxable year to which this subsection applies, then the tax imposed by this section shall not exceed the sum of:
(1) The tax computed at the rates and in the same manner as if this subsection had not been enacted on the greater of:
(A) The taxable income reduced by the amount of net capital gain, or
(B) The amount of taxable income taxed at a rate below 7.25 per cent, plus
(2) A tax of 7.25 per cent of the amount of taxable income in excess of the amount determined under paragraph (1).
This subsection shall apply to individuals, estates, and trusts for taxable years beginning after December 31, 1986.
(g) For each taxable year beginning after December 31, 2024, the director, no later than December 15 of the preceding calendar year, shall recompute the taxable income amounts within each of the income brackets in subsections (a), (b), and (c) by multiplying the taxable income amounts within each income bracket for the preceding taxable year by the cost-of-living adjustment factor, if the cost-of-living adjustment factor is greater than zero, and rounding off the resulting product to the nearest $1. If the cost-of-living adjustment factor is less than or equal to zero in a given year, then no adjustment will occur in the following year. Nothing in this subsection shall be construed as permitting an adjustment to the rates of tax in subsections (a), (b), and (c)."
SECTION 4. Section 235-54, Hawaii Revised Statutes, is amended to read as follows:
"§235-54 Exemptions. (a) In
computing the taxable income of any individual, there shall be deducted, in
lieu of the personal exemptions allowed by the Internal Revenue Code, personal
exemptions computed as follows: Ascertain
the number of exemptions which the individual can lawfully claim under the
Internal Revenue Code, add an additional exemption for the taxpayer or the
taxpayer's spouse who is sixty-five years of age or older within the taxable
year, and multiply that number by [$1,144,] $2,288, for taxable
years beginning after December 31, [1984.] 2023. A nonresident shall prorate the personal
exemptions on account of income from sources outside the State as provided in
section 235-5. In the case of an
individual with respect to whom an exemption under this section is allowable to
another taxpayer for a taxable year beginning in the calendar year in which the
individual's taxable year begins, the personal exemption amount applicable to
such individual under this subsection for such individual's taxable year shall
be zero.
(b) In computing the taxable income of an estate
or trust there shall be allowed, in lieu of the deductions allowed under
subsection (a), the following:
(1) An estate shall be allowed a deduction of $400.
(2) A trust which, under its governing instrument,
is required to distribute all of its income currently shall be allowed a
deduction of $200.
(3) All other trusts shall be allowed a deduction
of $80.
(c) A blind person, a deaf person, and any person totally disabled, in lieu of the personal exemptions allowed by the Internal Revenue Code, shall be allowed, and there shall be deducted in computing the taxable income of a blind person, a deaf person, or a totally disabled person, instead of the exemptions provided by subsection (a), the amount of $7,000.
(d) For each taxable year beginning after December 31, 2024, the director of taxation, no later than December 15 of the preceding calendar year, shall recompute the personal exemption and deduction amounts in this section by multiplying the amount for the preceding taxable year by the cost-of-living adjustment factor, if the cost-of-living adjustment factor is greater than zero, and rounding off the resulting product to the nearest $1. If the cost-of-living adjustment factor is less than or equal to zero in a given year, then no adjustment will occur in the following year."
SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 6. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2023.
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INTRODUCED BY: |
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Report Title:
Income Tax; Income Tax Brackets; Personal Exemption; Standard Deduction; Cost-of-Living Adjustment; Earned Income Tax Credit; Amount
Description:
Increases the amounts for the income tax brackets and personal exemption and standard deduction amounts for tax year 2024. Adjusts annually for tax years beginning after 12/31/2024, the income tax brackets and personal exemption, and standard deduction amounts by a cost-of-living adjustment factor. Amends the taxable income brackets and income tax rates for each filing status for taxable years beginning after 12/31/2023. Defines "cost-of-living adjustment factor".
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
