Hawaii does have a state income tax, and it applies to most residents and some nonresidents
Hawaii taxes income earned within the state at rates that range from 1.4% to 11%, depending on your income bracket. If you live in Hawaii, you pay tax on all income — wages, self-employment, investment gains, and retirement distributions. If you don't live there but work in Hawaii, you may owe tax on what you earn in the state. The tax is administered by the Hawaii Department of Taxation, and you file using Hawaii Form N-11 (the state equivalent of the federal 1040) or Form N-11NR if you're a nonresident.
Hawaii's income tax brackets change each year. For the 2023 tax year, a single filer with $50,000 in taxable income pays roughly $2,500 to $3,000 in state tax, though the exact amount depends on deductions and credits you claim. The state also allows a standard deduction, which reduces your taxable income before the tax is calculated.
Key Takeaways
- Hawaii residents pay state income tax on all income at rates between 1.4% and 11%, with rates rising as income increases.
- Nonresidents who work in Hawaii owe tax only on income earned within the state, not on income from other sources.
- You file Hawaii state taxes using Form N-11 (residents) or Form N-11NR (nonresidents), separate from your federal return.
- Hawaii offers a standard deduction and various credits that can lower your tax bill, including a dependent exemption credit.
- Military members stationed in Hawaii may be exempt from state income tax on military pay under the Servicemembers Civil Relief Act.
Who has to file a Hawaii state tax return
You must file a Hawaii return if you are a resident with income above the filing threshold. For 2023, that threshold is $12,200 for a single filer and $24,400 for a married couple filing jointly. If your income falls below that line, you don't have to file — though you may want to if you had taxes withheld, because you could receive a refund.
Nonresidents must file if they earned income in Hawaii above the threshold. This includes people who worked in Hawaii for part of the year, received rental income from Hawaii property, or had business income from a Hawaii source. Nonresidents report only the income earned in Hawaii, not income from other states or countries.
If you moved to Hawaii during the year, you are considered a resident for the full tax year. If you moved out of Hawaii during the year, you are also considered a resident for the full year. This means you file as a resident and report all income, even income earned after you left the state.
Hawaii income tax brackets and rates for 2023
Hawaii uses a progressive tax system, meaning the rate increases as your income rises. You don't pay the top rate on all your income — only on the portion that falls in each bracket. The brackets below explore to the 2023 tax year and are adjusted annually for inflation.
| Income Range (Single Filer) | Tax Rate |
|---|---|
| $0 to $2,400 | 1.4% |
| $2,400 to $5,600 | 3.2% |
| $5,600 to $8,000 | 5.5% |
| $8,000 to $14,000 | 7.2% |
| $14,000 and above | 11% |
Married couples filing jointly have different brackets — each bracket is roughly double the single filer amount. The Hawaii Department of Taxation publishes updated brackets each January on their website. If you file for a year after 2023, check the current year's brackets before calculating your tax.
Deductions and credits that reduce your Hawaii tax bill
Hawaii allows a standard deduction that works like the federal standard deduction: you subtract it from your gross income to arrive at taxable income. For 2023, the standard deduction is $2,600 for a single filer and $5,200 for a married couple filing jointly. If you itemize deductions on your federal return, you may also itemize on your Hawaii return, though Hawaii does not allow all the same deductions the federal government does.
Hawaii offers several credits that directly reduce the tax you owe. The dependent exemption credit gives you $168 per dependent for the 2023 tax year. If you have three children, that's $504 off your tax bill. Hawaii also offers a child and dependent care credit, a low-income household renters credit, and a credit for taxes paid to other states if you worked outside Hawaii during the year.
Military members stationed in Hawaii may not owe state income tax on military pay. Under the Servicemembers Civil Relief Act, active-duty military personnel can exclude military compensation from Hawaii taxable income if they are not Hawaii residents. You must file Form N-11 and claim the military pay exclusion; the form has a specific line for this.
How to file your Hawaii state tax return
You file your Hawaii return after you complete your federal return, because some Hawaii tax calculations depend on your federal taxable income. Gather your W-2 forms (if you were an employee), 1099 forms (if you had self-employment or investment income), and records of any tax payments or withholding made during the year.
read Form N-11 (for residents) or Form N-11NR (for nonresidents) from the Hawaii Department of Taxation website. The form walks you through calculating your income, subtracting deductions, explore credits, and determining what you owe or what refund you should receive. If you use tax software like TurboTax or H&R Block, those programs can file your Hawaii return at the same time as your federal return — usually for an additional fee.
Mail your completed return and any supporting documents to the Hawaii Department of Taxation at the address shown on the form. The important date is April 20 (Hawaii observes a state holiday on April 15). If you need more time, you can request an extension, which gives you until October 20 to file. An extension to file is not an extension to pay — if you owe tax, you should pay by April 20 to avoid penalties and interest.
What happens if you don't file or pay on time
If you owe Hawaii income tax and don't pay by the important date, the state charges interest at 0.5% per month (6% per year) on the unpaid amount. If you file late without a valid reason, there is also a failure-to-file penalty of 5% per month, up to 25% of the tax owed. If you file on time but pay late, the penalty is 5% per month for failure to pay, up to 25%.
If you don't file at all and the Hawaii Department of Taxation discovers you had a filing obligation, they can assess tax based on information they have (such as W-2 forms filed by your employer) and send you a bill. You then have the right to dispute the assessment, but you must do so within a specific timeframe. Filing, even if you owe money, is always better than not filing.
Nonresident taxation and part-year residents
If you worked in Hawaii but lived elsewhere, you file Form N-11NR and report only the income you earned in Hawaii. This includes wages from a Hawaii employer, net profit from a Hawaii business, and rental income from Hawaii property. You do not report income from a job in another state, investment income unrelated to Hawaii, or retirement distributions, even if you received them while in Hawaii.
Determining whether income is "Hawaii-source" can be tricky. Wages are Hawaii-source if you performed the work in Hawaii. If you worked remotely for a Hawaii company while living on the mainland, that income is not Hawaii-source. If you worked remotely for a mainland company while living in Hawaii, that income is Hawaii-source. When in doubt, contact the Hawaii Department of Taxation before filing.
Frequently Asked Questions
Do I have to file a Hawaii return if I already filed a federal return?
Yes, if you meet Hawaii's filing threshold. Hawaii and the federal government are separate tax systems. Filing a federal return does not satisfy Hawaii's requirement. You must file both returns, though you can do so at the same time using tax software.
What if I moved out of Hawaii during the year?
You are considered a Hawaii resident for the full tax year and file as a resident, reporting all income earned during the year. You do not prorate the year or file as a nonresident for the months you were out of state. This rule applies whether you moved out or moved in.
Can I file my Hawaii return electronically?
Yes. The Hawaii Department of Taxation accepts e-filed returns through approved tax software providers. You can also file by mail. E-filing is faster and reduces errors, and you receive confirmation that the state received your return.
Do I owe Hawaii tax on Social Security or retirement distributions?
Hawaii does not tax Social Security benefits. Retirement distributions (from IRAs, 401(k)s, and pensions) are taxable as income. Military retirement pay is taxable unless you are an active-duty service member claiming the military pay exclusion.
What if I had no income but lived in Hawaii all year?
You do not have to file if your income is below the filing threshold, even if you lived in Hawaii. However, if you had taxes withheld from any source, filing allows you to claim a refund of those withheld amounts.