Report Title:

Tax Credit; Medical Malpractice; Insurance

Description:

Provides a tax credit equal to an unspecified percentage of medical malpractice premium costs incurred by a physician who relocates to a rural area.

HOUSE OF REPRESENTATIVES	H.B. NO.	2846
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO medical liability tax credits.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§235-  Medical malpractice insurance premium tax credit. (a)  There shall be allowed to each individual taxpayer who is not claimed, or is not otherwise eligible to be claimed, as a dependent by another taxpayer for federal or state income tax purposes, a medical malpractice insurance premium tax credit that shall be deductible from the eligible taxpayer's net income tax liability imposed by this chapter for the taxable year in which the tax credit is properly claimed.

(b)  The tax credit shall be equal to one hundred per cent of the cost of medical malpractice insurance premiums and moving expenses paid by a physician licensed under chapter 453 or 460 who relocates the physician's principal place of business of practicing medicine to a rural area for at least a full taxable year.

For the purposes of this section, "rural area" means any county with a population fewer than five hundred thousand persons.

(c)  The tax credit under this section may be claimed for not more than five years.

(d)  To qualify for the tax credit, the taxpayer shall be a full-time resident of the State who is in compliance with all applicable federal, state, and county statutes, rules, and regulations.

(e)  If the tax credit under this section exceeds the taxpayer's net income tax liability, the amount of the excess tax credit shall be paid to the eligible taxpayer; provided that no refund or payment on account of the tax credit allowed by this section shall be made for amounts less than $1.

(f)  Every claim, including amended claims, for the tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the tax credit may be claimed.  Failure to meet the filing requirements of this subsection shall constitute a waiver of the right to claim the tax credit.

(g)  The director of taxation:

(1) Shall prepare forms as may be necessary to claim a tax credit under this section;

(2) May require proof of the claim for the tax credit; and

(3) May adopt rules pursuant to chapter 91 to effectuate the purposes of this section."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect upon its approval and shall apply to taxable years beginning after December 31, 2007.

INTRODUCED BY:

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