Instructions for Form N-30, Rev 2017

1 2017 STATE OF HAWAII DEPARTMENT OF TAXATION (REV. 2017 ) Instructions FOR form N-30 CORPORATION INCOME TAX RETURN (Section references are to the Internal Revenue Code (IRC), unless otherwise indicated)ATTENTION:Hawaii has not adopted the increased expensing deduction under section 179 (Hawaii limit is $25,000) or the bonus depreciation has not adopted the domestic production deduction under section To Get Tax FormsHawaii tax forms, Instructions , and schedules may be obtained at any taxation district office or from the Department of Taxation s website at , or you may contact a customer service representative at 808-587-4242 or 1-800-222-3229 (Toll-Free).

2 Changes You Should Note Act 95, Session Laws of Hawaii (SLH) 2017 This act amends Hawaii Income Tax Law under chapter 235, Hawaii Revised Statutes (HRS), to conform to certain provisions of the IRC, as amended as of December 31, 125, SLH 2017 This act requires all cess-pools in the State to be upgraded prior to January 1, 2050 unless there is an exemption granted by the Director of Health and amends the definition of qualified cesspool in section , 142, SLH 2017 This act amends the cer-tification process for the Renewable Fuels Production Tax Credit by requiring taxpayers to complete and file an independent.

3 Third-par-ty-certified statement with the Department of Business, Economic Development, and Tour-ism (DBEDT) for taxable years beginning after December 31, 143, SLH 2017 This act amends the quali-fications a production must meet in order to claim the Motion Picture, Digital Media, and Film Production Income Tax Credit. This act also caps the amount of tax credit that may be claimed at $35,000,000 per year, extends the sunset date to January 1, 2026, and requires film productions claiming the tax credit to ob-tain a verification review of qualified production costs by a certified public accountant.

4 This act applies to taxable years beginning after De-cember 31, 202, SLH 2016 This act repeals the Etha-nol Facility Tax Credit and establishes a new, nonrefundable Renewable Fuels Production Tax Credit for taxable years beginning after De-cember 31, 2016. The credit is available for five consecutive years beginning with the first tax-able year the taxpayer claiming the credit begins producing at least 15 billion British thermal units of renewable fuel per year. DBEDT must certify all claims for the credit, which cannot exceed $3,000,000 in any given 213, SLH 2017 This act amends the Capi-tal Infrastructure Tax Credit to include struc-tures, machinery, equipment, and capital as-sets in the definition of capital infrastructure costs, increases the cap on the credit from $1,250,000 to $2,500,000, allows qualified in-frastructure tenants to create special purpose entities.

5 And specifies that any excess credit may be carried forward. This act also requires a recapture of the credit if the qualified infra-structure tenant fails to relocate within a cer-tain period of time after executing a lease with the Department of Transportation, specifies taxpayer reporting requirements, and provides penalties for failure to report 258, SLH 2016 This act establishes a new, nonrefundable Organic Foods Production Tax Credit for taxable years beginning after Decem-ber 31, 2016 and is repealed December 31, 2021.

6 This credit is for qualified expenses asso-ciated with the production or handling of organic foods. The tax credit is equal to the qualified ex-penses of the taxpayer, which must be certified by the Department of Agriculture up to $50, InstructionsFILING REQUIREMENTSNote A copy of the federal corporation re-turn is not required to be attached. For lines 1 through 5 and 7 through 10, enter the appropriate amounts from the Corporation s federal return. Writing See attached federal return on form N-30 and attaching a copy of the corporation s federal form 1120 is not acceptable.

7 WHO MUST FILEA Corporation Income Tax Return, form N-30, shall be filed by every corporation, includ-ing regulated investment companies and real es-tate investment trusts, domestic or foreign, other than one qualifying as an S Corporation, having gross income from property owned, trade or busi-ness carried on, or any other source in Hawaii, unless expressly exempted as stated below. In addition, every domestic corporation (except one exempted) shall file this return if it has gross income from property owned, trade or business carried on, or any other source outside Hawaii, unless subjected to income tax thereon in any other jurisdiction.

8 (Subjection to federal tax does not constitute subjection to income tax in another jurisdiction.)An affiliated group of domestic (Hawaii) cor-porations may make and file a consolidated re-turn for the taxable year in lieu of separate re-turns in the manner and to the extent, so far as applicable, set forth in section 1501 through 1505 and 1552, as amended. If the affiliated group in-cludes non-Hawaii corporations and the group operates a unitary business, the taxable income of the group must be determined on a combined basis.

9 See section 18-235-22-01 thru 05, Hawaii Administrative Rules (HAR), and Tax Information Release No. 97-2 for information on the filing of a combined tax return by a unitary business as part of a unitary corporation having a valid S Corporation election for federal income tax purposes must use Hawaii form N-35, S Corporation Tax 235-9, HRS, provides that the follow-ing shall not be taxable under the Hawaii Income Tax Law:(1) Banks, building and loan associations, finan-cial services loan companies , financial corpo-rations, small business investment companies , trust companies , mortgage loan companies , financial holding companies , subsidiaries of financial holding companies as defined in Chapter 241, HRS, and development compa-nies taxable under the provisions of Chapter 241, HRS.

10 (2) Insurance companies , agricultural cooperative associations and fish marketing associations exclusively taxable under the provisions of other N-70NP must be filed reporting unre-lated business taxable income if federal form 990T is required under the INCOME, TAXABLE INCOME, DEFINED Gross income and taxable income are de-fined to have the same meaning as in the IRC of 1986, as amended, except as otherwise provided in the Hawaii Income Tax adjustments of income as reported for federal purposes, see Instructions for Schedule TO BE COVERED BY RETURNR eturns shall be filed for the calendar year 2017 or fiscal year beginning in 2017 and ending in 2018.