SB 868 Summary

• Establishes income-based tax credit brackets for low-income renters, replacing the previous flat $50 credit, with credit amounts of $150, $100, $50, or $0 depending on adjusted gross income and filing status.

• Creates different income thresholds for single filers ($20,000, $30,000, $40,000), heads of household ($30,000, $45,000, $60,000), and joint filers ($40,000, $60,000, $80,000).

• Implements annual inflation adjustments to all dollar amounts in the tax credit table beginning in taxable year 2023, indexed to the consumer price index for Hawaii compared to June 2021 baseline.

• Allows taxpayers age 65 and older to claim double the applicable tax credit amount.

• Applies to taxable years beginning after December 31, 2021, and maintains existing eligibility requirements including $1,000 minimum rent paid annually and non-exemption of rental property from real property tax.