Bill Text: HI HB1513 | 2022 | Regular Session | Amended
Bill Title: Relating To The Low-income Household Renters Tax Credit.
Spectrum: Partisan Bill (Democrat 18-0)
Status: (Introduced - Dead) 2022-02-15 - Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with none voting aye with reservations; none voting no (0) and Representative(s) McKelvey excused (1). [HB1513 Detail]
Download: Hawaii-2022-HB1513-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1513 |
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THIRTY-FIRST LEGISLATURE, 2022 |
H.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO THE LOW-INCOME HOUSEHOLD RENTERS TAX CREDIT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that homelessness is a serious problem in Hawaii, due in part to the high cost of housing in the State. Since 1977, the State has made tax credits available to assist eligible renters; this tax credit is the third most commonly used tax credit among Hawaii residents. The income eligibility threshold for this tax credit was last adjusted in 1989 and the credit amount allowed was last adjusted in 1981. Since 1989, the cost of housing has increased by three hundred ninety per cent. Therefore, the legislature finds that it is appropriate to adjust the eligibility requirements for the income tax credit for low‑income household renters.
The purpose of this Act is to:
(1) Adjust the eligibility requirements for the income tax credit for low-income household renters;
(2) More effectively target the tax credit toward lower-income taxpayers by creating tax brackets that will phase out the credit as the taxpayer's income rises; and
(3) Adjust the amount of the credit every three years by using a percentage based on the urban Hawaii consumer price index.
SECTION 2. Section 235-55.7, Hawaii Revised Statutes, is amended to read as follows:
"§235-55.7 Income tax credit for low-income household renters. (a) As used in this section:
[(1)] "Adjusted gross income" [is
defined by section 235-1.] means federal adjusted gross income as defined
and determined under the Internal Revenue Code.
"Consumer price index" means the urban Hawaii consumer price index for all urban consumers published by the United States Department of Labor, or a successor index.
[(2)] "Qualified exemption" includes those
exemptions permitted under this chapter; provided that a person for whom
exemption is claimed has physically resided in the State for more than nine
months during the taxable year; [and] provided further that
multiple [exemption] exemptions shall not be granted because of
deficiencies in vision, hearing, or other disability.
[(3)] "Rent" means the amount paid in cash
in any taxable year for the occupancy of a dwelling place [which] that
is used by a resident taxpayer or the resident taxpayer's immediate family as the
principal residence in this State. [Rent]
"Rent" is limited to the amount paid for the occupancy of the
dwelling place only[,] and is exclusive of charges for utilities,
parking stalls, storage of goods, yard services, furniture, furnishings, and the
like. [Rent] "Rent"
shall not include any rental claimed as a deduction from gross income or
adjusted gross income for income tax purposes[, any]; ground
rental paid for use of land only[, and]; or any rent allowance or
subsidies received.
(b)
Each resident taxpayer who occupies and pays rent for real property
within the State as the resident taxpayer's residence or the residence of the
resident taxpayer's immediate family [which] that is [not]
partially or wholly exempted from real property tax, who is not eligible to be
claimed as a dependent for federal or state income taxes by another, and who
files an individual net income tax return for a taxable year, may claim a tax
credit under this section against the resident taxpayer's Hawaii state
individual net income tax.
(c)
Each taxpayer [with an adjusted gross income of less than $30,000]
who has paid more than $1,000 in rent during the taxable year for which the
credit is claimed may claim a tax credit of [$50 multiplied by the number of
qualified exemptions to which the taxpayer is entitled;] in accordance with
the table below; provided that each taxpayer sixty-five years of age
or over may claim double the tax credit; [and] provided further that
a resident individual who has no income or no income taxable under this chapter
may also claim the tax credit as set forth in this section.
Adjusted gross income Credit per
for taxpayers filing qualified exemption
a single return or married
individuals filing
separate returns
Under $20,000 $200
$20,000 under $30,000 $150
$30,000 under $40,000 $100
$40,000 and over $
0.
Adjusted gross income Credit
per
for heads of household qualified
exemption
Under $30,000 $200
$30,000 under $45,000 $150
$45,000 under $60,000 $100
$60,000 and over $
0.
Adjusted gross income Credit
per
for taxpayers filing qualified
exemption
a joint return under
section 235-93 or a
surviving spouse
Under $40,000 $200
$40,000 under $60,000 $150
$60,000 under $80,000 $100
$80,000 and over $
0.
(d) For the taxable year beginning after December 31, 2023, and in every third taxable year thereafter, each dollar amount contained in the table in subsection (c) shall be increased by an amount equal to that dollar amount, multiplied by the percentage, if any, by which the consumer price index for June of the preceding calendar year exceeds the consumer price index for June 2022 and June of the calendar year when the credit was last adjusted, rounded to the nearest whole dollar amount.
[(d)] (e) If a rental unit is occupied by two or more
individuals, and more than one individual is able to qualify as a claimant, the
claim for credit shall be based upon a pro rata share of the rent paid.
[(e)] (f) The tax credits shall be deductible from the
taxpayer's individual net income tax for the tax year in which the credits are
properly claimed; provided that [a husband and wife] married individuals
filing separate returns for a taxable year for which a joint return could have
been made by them shall claim only the tax credits to which they would have
been entitled had a joint return been filed.
In the event the allowed tax credits exceed the amount of the income tax
payments due from the taxpayer, the excess of credits over payments due shall
be refunded to the taxpayer; provided that allowed tax credits properly claimed
by an individual who has no income tax liability shall be paid to the individual;
[and] provided further that no refunds or payments on account of the tax
credits allowed by this section shall be made for amounts less than $1.
[(f)] (g) The director of taxation shall prepare and
prescribe the appropriate form or forms to be used herein, may require proof of
the claim for tax credits, and may adopt rules pursuant to chapter 91.
[(g)] (h) All of the provisions relating to assessments
and refunds under this chapter and under section 231-23(c)(1) shall apply to
the tax credits hereunder.
[(h)] (i) Claims for tax credits under this section,
including any amended claims thereof, shall be filed on or before the end of
the twelfth month following the taxable year for which the credit may be claimed."
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act shall take effect on July 1, 2050, and shall apply to taxable years beginning after December 31, 2021.
Report Title:
Income Tax Credit for Low-income Household Renters; Eligibility; Adjustments; Consumer Price Index
Description:
Increases the credit amount and the income eligibility cap thresholds for the income tax credit for low-income household renters by using tax brackets. Provides for inflation increases every three years based on the urban Hawaii consumer price index beginning with taxable years beginning after 12/31/2023. Effective 7/1/2050. (HD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
