TWENTY-NINTH LEGISLATURE, 2017
STATE OF HAWAII
A BILL FOR AN ACT
RELATING TO WITHHOLDING TAX.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that requiring quarterly returns of withheld income tax is more efficient than monthly reporting. The legislature finds that the department can adequately reconcile withholding tax payments with quarterly filing. This measure will change the reporting frequency from monthly reporting to quarterly reporting for all employers. This measure does not change the withholding tax payment frequency.
SECTION 2. Section 235-62, Hawaii Revised Statutes, is amended to read as follows:
"§235-62 Return and payment of
withheld taxes. (a) Every employer required by this chapter to withhold
taxes on wages paid in any [
month] quarter of the calendar year shall
make a return of such wages to the department of taxation
on or before the fifteenth
day of the calendar month following the [ month] close of each such
quarter for which the taxes have been withheld[ , except as provided in
(b) The return shall be in such form, including computer printouts or other electronic formats, and contain such information as may be prescribed by the director of taxation. The return shall be filed with the director at the first taxation district in Honolulu.
(c) Every return required under this section
shall be accompanied by a remission of the complete amount of tax withheld, as
reported in the return; provided that each employer whose liability for taxes
withheld exceeds $40,000 annually shall remit the complete amount of tax
withheld on a semi-weekly schedule[
.]; provided further that each
employer whose liability for taxes withheld exceeds $5,000 but does not exceed
$40,000 annually shall remit the complete amount of tax withheld on a monthly
schedule. Notwithstanding the tax liability threshold in this
subsection, the director of taxation is authorized to require any employer who
is required to remit any withheld taxes to the federal government on a
semi-weekly schedule, to remit the complete amount of tax withheld to the
department on a semi-weekly schedule. The director of taxation may grant
an exemption to the requirement to remit the complete amount of tax withheld on
a semi-weekly schedule for good cause.
(d) If the director believes collection of the tax may be in jeopardy, the director may require any person required to make a return under this section to make such return and pay such tax at any time.
The director may grant permission to employers, whose liability to pay over
the taxes withheld as provided in this section shall not exceed $5,000 a year,
to make returns and payments of the taxes due on a quarterly basis during the
calendar year, the returns and payments to be made on or before the fifteenth
day of the calendar month after the close of each quarter, to wit, on or before
April 15, July 15, October 15, and January 15. The director may grant
permission to employers to make monthly payments based on an estimated
quarterly liability; provided that the employer files a reconciliation return
on or before the fifteenth day of the calendar month after the close of each
quarter during the calendar year as provided by this section.] The
director, for good cause, may extend the time for making returns and payments,
but not beyond the fifteenth day of the second month following the regular due
date of the return. With respect to wages paid out of public moneys, the director,
in the director's discretion, may prescribe special forms for, and different
procedures and times for the filing of, the returns by employers paying the
wages, or may waive the filing of any returns upon the conditions and subject
to rules the director may prescribe.
(f) For purposes of this section, "semi-weekly schedule" means:
(1) On or before the following Wednesday if wages were paid on the immediately preceding Wednesday, Thursday, or Friday; or
(2) On or before the following Friday if wages were paid on the immediately preceding Saturday, Sunday, Monday, or Tuesday.
In addition to the allowances provided under section 231-21, each employer shall have at least three banking days following the close of the semi-weekly period by which to remit the taxes withheld as provided for in section 6302 of the Internal Revenue Code.
(g) For the purposes of this section, "monthly schedule" means on or before the fifteenth day of the calendar month following the month for which the taxes have been withheld."
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act, upon its approval, shall take effect on January 1, 2018.
Withholding Tax Returns
Changes the frequency of filing returns of taxes withheld on wages paid from monthly to quarterly for all employers. (SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.