HI SB654

Establishes a non-refundable "ohana residential housing income tax credit" for qualified taxpayers purchasing newly constructed principal residences or performing residential construction/remodeling.

Provides a 2% tax credit on the purchase price of qualified principal residences (maximum $625,000) purchased between April 1, 2011 and January 1, 2013, payable in two equal installments over two consecutive tax years.

Provides a 2% tax credit on residential construction or remodeling costs (maximum $250,000 per residential unit) incurred before July 1, 2012, limited to owner-occupied primary residences.

Restricts eligibility to individual taxpayers with adjusted gross income of $75,000 or less (or $150,000 for married couples), and requires newly constructed homes to receive certificates of completion on or after April 1, 2011.

Implements recapture provisions requiring repayment of 100% of construction/remodeling credits if the property is sold within two years, and pro rata recapture if the home is sold or vacated within 730 days of closing escrow.