Bill Text: HI HB1957 | 2024 | Regular Session | Amended
Bill Title: Relating To Research Activities.
Spectrum: Partisan Bill (Democrat 7-0)
Status: (Engrossed) 2024-03-07 - Referred to EET, WAM. [HB1957 Detail]
Download: Hawaii-2024-HB1957-Amended.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1957 |
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THIRTY-SECOND LEGISLATURE, 2024 |
H.D. 2 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO RESEARCH ACTIVITIES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Section 235-110.91, Hawaii Revised Statutes, is amended as follows:
1. By amending subsection (b) to read:
"(b) All references to Internal Revenue Code
sections within sections 41 and 280C(c) of the Internal Revenue Code shall be
operative for purposes of this section[; provided that references to the
base amount in section 41 of the Internal Revenue Code shall not apply, and
credit for all qualified research expenses may be taken without regard to the
amount of expenses for previous years]."
2. By amending subsection (f) to read:
"(f) If in any taxable year the annual amount of
certified credits reaches [$5,000,000] $15,000,000 in the
aggregate, the department of business, economic development, and tourism shall
immediately discontinue certifying credits and notify the department of
taxation. In no instance shall the
department of business, economic development, and tourism certify a total
amount of credits exceeding [$5,000,000] $15,000,000 per taxable
year. To comply with this restriction,
the department of business, economic development, and tourism shall certify
credits on a first come, first served basis.
The department of taxation shall not allow the aggregate amount of credits claimed to exceed that amount per taxable year."
3. By amending subsections (n) and (o) to read:
"(n) This section shall not apply to taxable years
beginning after December 31, [2024.] 2029.
(o) As used in this section:
"Qualified
high technology business" [shall have the same meaning as in section
235-7.3(c).] means a small
business that conducts more than fifty per cent of its activities in qualified
research in the State and is registered to do business in the State.
"Qualified research" shall have the same meaning as in section 41(d) of the Internal Revenue Code.
"Qualified research expenses" shall have the same meaning as in section 41(b) of the Internal Revenue Code; provided that it shall not include research expenses incurred outside of the State.
"Small business" means a company with no more than five hundred employees, including affiliates."
SECTION 2. Act 261, Session Laws of Hawaii 2019, is amended by amending section 5 to read as follows:
"SECTION 5. This Act shall take effect upon its approval; provided that:
(1) Section 2 shall apply to taxable years beginning after December 31, 2019; and
(2) Part II shall take effect on December 31, [2024.]
2029."
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act shall take effect on July 1, 3000; provided that section 1 shall apply to taxable years beginning after December 31, 2023.
Report Title:
Tax Credit for Research Activities; Small Business
Description:
Repeals the provision that made references to the base amount in the Internal Revenue Code inapplicable to the research activities tax credit and allowed credits for all qualified research expenses to be taken without regard to previous years expenses. Narrows the qualifying criteria for research activities tax credits to applicants who are small businesses registered in the State. Increases the maximum amount of tax credits that can be certified per year. Extends the sunset date of the research activities tax credit by five years. Effective 7/1/3000. (HD2)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
