HOUSE OF REPRESENTATIVES

H.B. NO.

351

THIRTY-SECOND LEGISLATURE, 2023

H.D. 2

STATE OF HAWAII

S.D. 1

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO 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 part III to be appropriately designated and to read as follows:

     "§235-    Fire prevention and fire safety system in condominiums; maintenance fee increase; special assessment; tax credit.  (a)  A qualified taxpayer who owns a unit for which the condominium association is increasing the maintenance fee or imposing a special assessment to comply with a county ordinance requiring an automatic fire sprinkler system or alternative fire prevention and fire safety system may claim a nonrefundable tax credit equal to the amount by which the maintenance fee increased, the special assessment imposed, or the amount actually paid by the taxpayer, but not to exceed $          ; provided that no more than one nonrefundable tax credit may be claimed per unit.  The aggregate amount of tax credits claimed under this section shall not exceed $           for each taxable year.

     (b)  The credit allowed under this section shall be claimed against the taxpayer's net income tax liability for the taxable year in which the special assessment or increase in the maintenance fee was imposed and paid.  If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of the tax credit over liability may be used as a credit against the taxpayer's net income tax liability in subsequent years until exhausted.  All claims, including amended claims, for a 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 credit may be claimed.  Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

     (c)  The director of taxation:

     (1)  Shall prepare any forms 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 this section.

     (d)  The department shall:

     (1)  Maintain records of the names and addresses of the taxpayers claiming the credits under this section and the total amount of the maintenance fee increases and special assessments paid upon which the tax credit is based;

     (2)  Verify the nature and amount of the maintenance fee increases and special assessments claimed;

     (3)  Total all maintenance fee increases and special assessments claimed; and

     (4)  Certify the total amount of the tax credit for each taxable year.

     (e)  For the purposes of this section:

     "Alternative fire prevention and fire safety system" means a building's safety features and fire protection systems in compliance with the applicable county fire code and county building code that provide a minimum level of fire and life safety to occupants and fire fighters, as approved by the county in which the condominium is located.

     "Association" has the same meaning as in section 514B-3.

     "Automatic fire sprinkler system" means automatic sprinklers installed and maintained in full operating condition in accordance with the applicable county fire code and as approved by the county in which the condominium is located.

     "Condominium" has the same meaning as in section 514B-3.

     "Net income tax liability" means net income tax liability reduced by all other credits allowed under this chapter.

     "Qualified taxpayer" means a person subject to the taxes imposed by this chapter and who is:

     (1)  Filing individually with a gross income equal to or less than $100,000;

     (2)  Married filing separately with a gross income equal to or less than $150,000; or

     (3)  Married filing jointly with a combined income equal to or less than $200,000.

     "Unit" has the same meaning as in section 514B-3."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect on June 30, 3000, and shall apply to taxable years beginning after December 31, 2023.

 

 

Report Title:

Fire Prevention and Fire Safety System; Condominium Association; Maintenance Fee Increase; Special Assessment; Income Tax Credit

 

Description:

Establishes a nonrefundable income tax credit for owners of condominium units whose condominium association is increasing maintenance fees or imposing a special assessment to comply with a county ordinance requiring an automatic fire sprinkler system or alternative fire prevention and fire safety system, to be applied to taxable years beginning after December 31, 2023.  Effective 6/30/3000.  (SD1)

 

 

 

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