HOUSE OF REPRESENTATIVES

H.B. NO.

2050

TWENTY-FIFTH LEGISLATURE, 2010

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to taxation.

 

 

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

 


     SECTION 1.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§235-    Withholding tax; self-funded retirement plan.  (a)  The department of taxation shall adopt rules pursuant to chapter 91 to require the deduction and withholding of tax from any taxpayer who withdraws funds from a self-funded retirement plan; provided that the amount deducted and withheld is sufficient to cover the amount of funds withdrawn from the retirement plan and is consistent with federal law.

     (b)  Any tax withheld under this section shall be credited against the amount of income tax liability owed by the taxpayer; provided that, if the amount withheld is in excess of the tax due for the taxable year, the taxpayer shall be refunded the difference as provided in section 235-110.

     (c)  For the purposes of this section, "self-funded retirement plan" means a deferred compensation plan, individual retirement account, or any other type of retirement plan that complies with federal or state law and is funded exclusively by the person who owns the plan."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect upon its approval and shall apply to taxable years beginning after December 31, 2009.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

Income Tax Withholding; Self-Funded Retirement Plan

 

Description:

Requires the DOTAX to withhold state taxes for self-funded retirement plans.

 

 

 

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