Bill > HB567

This bill creates a new tax deduction for tipped employees in Hawaii, allowing them to deduct the total amount of tips they receive during a taxable year from their gross income. The deduction applies specifically to tips reported to employers for Federal Insurance Contribution Act (FICA) purposes, and is available to employees who earn more than $30 per month in gratuities. Tips are defined as voluntary monetary contributions received from guests, patrons, or customers. The director of taxation will be responsible for creating the necessary forms for claiming this deduction and may require proof of the claimed tips. The tax deduction will take effect for taxable years beginning after December 31, 2025, providing tipped workers, such as restaurant servers, bartenders, and other service industry employees, with potential tax relief by reducing their taxable income by the amount of tips they earn and report.

Labor and Employment

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HB&billnumber=567&year=2025