Bill > HB694

This bill establishes a refundable state child tax credit for Hawaii residents that provides graduated financial support for families with children under 18, based on the taxpayer's adjusted gross income. The credit ranges from $650 per child for households earning under $40,000 to $0 for households earning $115,000 or more, and it is designed to help address the disproportionate tax burden on low-income families. To be eligible, taxpayers must file a federal income tax return claiming the federal child tax credit and use the same filing status and dependents on their Hawaii state tax return. The credit is fully refundable, meaning that if the credit exceeds the taxpayer's tax liability, the excess will be refunded, with a minimum refund of $1. The director of taxation is required to prepare necessary forms, potentially verify claims, alert eligible taxpayers, and submit an annual public report detailing the credits granted. The bill will take effect for taxable years beginning after December 31, 2025, and is part of a broader effort to support working families and reduce child poverty, inspired by the temporary expansion of the federal child tax credit under the American Rescue Plan Act of 2021.

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https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HB&billnumber=694&year=2025