HOUSE OF REPRESENTATIVES	H.B. NO.	726
THIRTIETH LEGISLATURE, 2019
STATE OF HAWAII

A BILL FOR AN ACT

relating to a teacher tax credit.

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

SECTION 1. The legislature finds that in a survey conducted by the Hawaii State Teachers Association, forty-seven per cent of respondents cited personal expenditures of between two hundred fifty dollars and five hundred dollars each year on classroom supplies, with many claiming expenditures in excess of one thousand dollars. Moreover, according to numerous studies of teacher compensation, Hawaii's public school teachers receive the lowest salaries in the nation when adjusted for cost-of-living. Therefore, when teachers are forced to purchase classroom supplies out of their own pocketbooks because of inadequate school funding, they face a disproportionately adverse financial impact in comparison to their national peers.

The purpose of this Act is to provide teachers with financial support for classroom expenses by establishing a five-hundred dollar state income tax credit for teachers to offset personal expenditures on school and classroom supplies.

SECTION 2. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235-   Certain expenses; classrooms; tax credit. (a) There shall be allowed to each qualified taxpayer subject to the tax imposed by this chapter a tax credit for certain expenses of school teachers that shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

(b) The amount of the tax credit shall be equal to the amounts expended for certain expenses in a taxable year; provided that the credit shall not exceed $500 per taxable year.

(c) If the tax credit under this section exceeds the taxpayer's net income tax liability, the excess of credit over liability may be used as a tax credit against the taxpayer's net income tax liability in subsequent years until exhausted. All claims for a tax credit under this section, including amended claims, 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 comply with the foregoing provision shall constitute a waiver of the right to claim the tax credit.

(d) No other tax credit may be claimed under this chapter for the certain expenses used to properly claim a tax credit under this section for the taxable year.

(e) The director of taxation shall prepare any forms that may be necessary to claim a credit under this section. The director may also require the taxpayer to furnish reasonable information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.

(f) As used in this section:

"Certain expenses" means expenses paid or incurred by a qualifying taxpayer who incurs the expenses in connection with books; supplies, other than athletic supplies for courses of instruction in health or physical education; computer equipment, including related software and services; and supplementary materials used by the qualifying taxpayer in the classroom.

"Qualifying taxpayer" means a school teacher, special education teacher, school librarian, or counselor employed by the department of education, a public charter school, or a private school in the State who instructs students in any grade between prekindergarten and twelfth grade."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2018.

INTRODUCED BY:

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Report Title:

School Teacher Tax Credit; School Expenses

Description:

Authorizes a state income tax credit up to $500 for certain expenses paid or incurred by school teachers, special education teachers, school librarians, and counselors for supplementary materials used in the classroom.

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