S.B. 2627 Summary

• Increases the income tax credit for low-income household renters by establishing tiered tax brackets based on adjusted gross income and filing status, with credits ranging from $100 to $200 per exemption depending on income level and household type.

• Raises the adjusted gross income eligibility threshold from $30,000 (last adjusted in 1989) to $40,000-$80,000 depending on filing status, allowing more renters to qualify for the credit.

• Requires annual adjustments to all dollar amounts in the credit tables beginning in 2022, indexed to the percent change in the urban Hawaii consumer price index from June of the prior year compared to June 2020.

• Maintains existing requirements that taxpayers must pay more than $1,000 in annual rent, allows senior taxpayers (age 65+) to claim double the credit, and permits refund of excess credits.

• Effective for taxable years beginning after December 31, 2020, with full implementation on July 1, 2050.