Below is a list of income that can be subtracted on your Hawaii return:
Military Reserve or HI National Guard
The first $6,564 earned by any member of the Reserve, Army, Navy, Air Force, Marine Corp or Coast Guard, is not taxed by Hawaii. If you qualify, enter the smaller of the two; Your pay or the $6,564.
Married persons filing a joint return may add the exclusion amount for both and enter that amount as a subtraction.
Payments to an Individual Housing Account (up to $5,000 for single; $10,000 for married)
Compensation to Hansens Patient
Certain Income from a Qualified High Technology Business
You may subtract any income obtained from patents, copyrights, trade secrets, or stock options from your Hawaii taxable income if this income was reported for federal purposes.
Legal Services Plans
If you or your employer contributed to a legal services plan and you reported these benefits as taxable on your federal return, you may be able to list them as a subtraction on your Hawaii return.
- Interest on federal obligations, including U.S. Savings Bonds.
- Differences in the taxable portion of the Hawaii tax refund.
- Interest earned on an Individual Housing Account.
- Expenses not allowed on your federal return because they were connected with federal credits.
- Unearned income of children that you included in your federal return, if the children are filing Hawaii returns.
- Benefits from or premiums paid to legal services plans.
- Differences in the deduction for student loan interest.
- Differences in the taxable portion of employer-provided adoption benefits.
- Certain income from a qualified high technology business.
- Contributions to and interest earned by an individual development account.
- Section 235-7(a)(14), HRS, capital gain.
- Undistributed income earned by certain foreign corporations.
- Other adjustments.
Individual Development Accounts
You may subtract contributions made to an individual development account as well as interest earned by the account.
Annual Pension Exclusion
Hawaii does not tax distributions from qualified employer funded pension plans. If your pension distribution was from an employer-funded profit sharing, defined contribution, or defined benefit plan, or from a government retirement system (e.g., federal civil service, military pension, state or county retirement system), enter the qualifying amount as a subtraction.
State Taxable Refund
If you entered your state refund on your federal return for federal purposes, you may enter this amount as a subtraction on your Hawaii return.
For additional information, please see Form N-11 Instructions.