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Accounting and state tax in Hawaii

Hawaii taxes corporations at 4.4%–6.4%, never adopted federal bonus depreciation, and from 2026 decouples from §174A, so research costs are amortized for Hawaii even when expensed federally.

Jurisdiction
Hawaii
Reading time
2 min
Checked
October 12, 2026
Point at another state to compare its accounting.

Key figures

Hawaii accounting

2026, with sources

Corporate income tax
4.4%–6.4%4.4% up to $25,000 of taxable income, 5.4% to $100,000, 6.4% above.
IRC conformity (2025 returns)
As of Dec 31, 2024Fixed date; Hawaii lists the federal sections that don’t apply.
IRC conformity (2026 on)
As of Dec 31, 2025HB 2329, for tax years beginning after Dec 31, 2025.
Section 174A
Not operativeDecoupled from 2026: domestic R&E follows §174 as it stood on Dec 31, 2024 (capitalize and amortize).
Bonus depreciation
Not adoptedHawaii has not adopted federal bonus depreciation; the §179 limit is $25,000.
Due date
Apr 20Automatic six-month extension to file.

Low rates, fixed conformity

Hawaii taxes corporations at three rates: 4.4% of taxable income up to $25,000, 5.4% up to $100,000 and 6.4% above, filed on Form N-30 by the 20th day of the fourth month. Hawaii conforms to the Internal Revenue Code as of a fixed date and lists the federal provisions that are not operative; for 2025 returns that date is December 31, 2024.

Hawaii has never adopted federal bonus depreciation and limits §179 expensing to $25,000, so fixed assets carry a separate Hawaii basis and a deferred tax difference in the state provision.

HB 2329 and research costs

In 2026, HB 2329 moved the conformity date to December 31, 2025 for tax years beginning after that date — but added the new federal §174A to the list of provisions that don’t apply in Hawaii. Domestic research and experimental costs follow §174 as it read at the end of 2024: capitalized and amortized over five years. Hawaii also decouples from the new §168(n) and keeps its decoupling from §168(k).

Example: a startup with $1 million of domestic engineering costs in 2026 deducts them federally under §174A. For Hawaii it deducts roughly a tenth of that in 2026 (half a year of five-year amortization) and the rest over the following years, which creates a Hawaii-only deferred tax asset — and Hawaii taxable income in a year the federal return shows a loss.

Apportionment

A corporation doing business both in and outside Hawaii allocates and apportions its income on Schedules O and P of Form N-30, and unitary groups compute the apportionment factors for each member of the combined group. The factors are reported on Schedule P, and the Hawaii share — not the company’s total income — is what the 4.4%–6.4% rates apply to.

Deadlines

  1. 20th day of the 4th month after year end — Apr 20Hawaii corporation income tax returnForm N-30
  2. Oct 20 for calendar yearsAutomatic six-month extension to file, without an applicationForm N-30 (extended)
  3. 20th day of the 4th, 6th and 9th months, and of the 1st month after year endQuarterly installmentsEstimated tax

The federal baseline

This page covers what Hawaii adds. The federal rules underneath it apply here too.

FederalFederal accounting for startupsFederal law sets the tax rules, not the bookkeeping ones: US GAAP comes from the FASB and from what investors expect, while Form 1120, the cash-method test and Section 174 come from the IRS. Every state builds its corporate tax on this return.

Common questions

Can we expense R&D in Hawaii like we do federally?

Not from 2026. HB 2329 moved Hawaii’s conformity date to December 31, 2025 for tax years beginning after that date, but made the new §174A inoperative: domestic research costs follow §174 as it read on December 31, 2024, so they are capitalized and amortized over five years for Hawaii even when expensed federally.

When is the Hawaii corporate return due?

On the 20th day of the fourth month — April 20 for a calendar year — not the 15th. Hawaii’s estimated payments and GET returns also run on the 20th.

How Hawaii compares

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More of the Hawaii guide

Sources

Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.

General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.

All state guides