H.B. 680 Summary

• Imposes conveyance tax on transfers of controlling interests (50% or more) in entities that own real property in Hawaii, effective for conveyances after June 30, 2014.

• Defines "controlling interest" as 50% or more of voting stock in corporations or 50% or more of capital/profits/beneficial interest in partnerships, trusts, or other entities.

• Applies the same progressive tax rates as direct real property conveyances (0.10% to 1.25% per $100 of consideration) based on the fair market value of the underlying real property interest transferred.

• Establishes exemptions for certain transactions including mergers/consolidations, transfers within families, transfers between entity members holding interests for 3+ years, and affordable housing project transfers.

• Requires grantors and grantees to file certificates of conveyance disclosing consideration and other facts prescribed by the Department of Taxation, with penalties for disclosure violations.