HOUSE OF REPRESENTATIVES	H.B. NO.	1726
TWENTY-SEVENTH LEGISLATURE, 2014
STATE OF HAWAII

A BILL FOR AN ACT

relating to taxation.

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

     SECTION 1.  Section 235-71, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

     "(d)  In the case of a real estate investment trust there is imposed on the taxable income, computed [as provided in sections 857 and 858] prior to the adjustments provided by section 857(b)(2) of the Internal Revenue Code [but] and with the changes and adjustments made by this chapter [(without prejudice to the generality of the foregoing, the deduction for dividends paid is limited to such amount of dividends as is attributable to income taxable under this chapter)], a tax consisting in the sum of the following:  4.4 per cent if the taxable income is not over $25,000, 5.4 per cent if over $25,000 but not over $100,000, and on all over $100,000, 6.4 per cent.  [In addition to any other penalty provided by law any real estate investment trust whose tax liability for any taxable year is deemed to be increased pursuant to section 859(b)(2)(A) or 860(c)(1)(A) after December 31, 1978, (relating to interest and additions to tax determined with respect to the amount of the deduction for deficiency dividends allowed) of the Internal Revenue Code shall pay a penalty in an amount equal to the amount of interest for which such trust is liable that is attributable solely to such increase.  The penalty payable under this subsection with respect to any determination shall not exceed one-half of the amount of the deduction allowed by section 859(a), or 860(a) after December 31, 1978, of the Internal Revenue Code for such taxable year.]"

     SECTION 2.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 3.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 4.  This Act, upon its approval, shall apply to taxable years beginning after December 31, 2013.

INTRODUCED BY:

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Report Title:

Corporation Income Tax; Real Estate Investment Trusts

Description:

Amends the corporation income tax by taxing real estate investment trusts without regard to the federal deduction for dividends paid.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.