Report Title:

Taxation; Personal Exemption; Education

Description:

Doubles the personal exemption allowed to taxpayers with children in private schools.

THE SENATE

S.B. NO.

1123

TWENTY-THIRD LEGISLATURE, 2005

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO PERSONAL EXEMPTION.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that, although all taxpayers support the public education system, not all taxpayers enjoy the benefits of a public education. A substantial number of taxpayers choose to educate their children outside of the public education system. These taxpaying parents must support not only the education of children of other taxpayers, but their own children's education as well.

This Act levels the playing field by providing assistance to parents of children in private schools and in so doing assists the general public in assuring educational opportunities for all of Hawaii's children.

SECTION 2. Section 235-54, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) In computing the taxable income of any individual, there shall be deducted, in lieu of the personal exemptions allowed by the Internal Revenue Code, personal exemptions computed as follows: Ascertain the number of exemptions which the individual can lawfully claim under the Internal Revenue Code, add an additional exemption for [the]:

(1) The taxpayer or the taxpayer's spouse who is sixty-five years of age or older within the taxable year[,]; and

(2) The taxpayer who claims a personal exemption for a child between the ages of five and eighteen who attended a private school for the entire taxable year;

and multiply that number by $1,040, for taxable years beginning after December 31, 1984. A nonresident shall prorate the personal exemptions on account of income from sources outside the State as provided in section 235-5. In the case of an individual with respect to whom an exemption under this section is allowable to another taxpayer for a taxable year beginning in the calendar year in which the individual's taxable year begins, the personal exemption amount applicable to such individual under this subsection for such individual's taxable year shall be zero.

For the purposes of this section, "private school" means any academic school not a "public school" as that term is defined under section 302A-101. "Private school" includes parochial schools, non-parochial schools, home schools, religious schools, and notwithstanding the meaning of "public school", includes new century charter schools under subpart D, part IV of chapter 302A."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act upon its approval, shall apply to taxable years beginning after December 31, 2005.

INTRODUCED BY:

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