EARNED INCOME TAX CREDIT (EITC)

Rate (Fully-Refundable): 40% of the federal credit

Latest Legislative Action: In 2023, Gov. Josh Green passed HB954 (Act 163), doubling the state EITC.

Notes:

• In 2022, HB510 extended the state EITC for another six years and made the tax credit refundable. In the same year, legislation was signed to make the tax credit permanent.¹
• In 2021, lawmakers declined to extend the state EITC which was set to expire at the end of 2022.
• In January 2018, several lawmakers introduced legislation to make Hawaii’s EITC refundable.
• In  July 2017, Hawaii enacted a nonrefundable state-level EITC worth 20 percent of the federal credit.
• Lawmakers considered legislation in 2014 and 2016 that that would have created a refundable state EITC, but neither passed due to concerns of insufficient funding.

CHILD TAX CREDIT (CTC)

Hawaii does not currently offer a state-level CTC.

CHILD AND DEPENDENT CARE TAX CREDIT (CDCTC)

Rate (Fully-Refundable):

Calculated as a percentage of qualifying expenses, not as a percentage of the federal credit. However, the state credit covers the same kind of expenses but is limited to $10,000 for one child/dependent and $20,00 for two children/dependents.² Rates are dependent upon earned income levels as shown below.

Eligibility Requirements: To be eligible for the credit, a filer must maintain a household that includes at least one qualified dependent and may not be claimed as a dependent themselves. The filer must also have qualifying care expenses.

Notes: The Hawai’i CDCTC is known as the Household and Dependent Care Services Tax Credit.