What Is Hawaii Form N-20 and Who Must File?
Understand the annual tax compliance cycle for corporations in Hawaii, from preparing the Form N-20 return to managing ongoing obligations.
Hawaii Form N-30, the Corporation Income Tax Return, is a state-specific document used by corporations to report their financial activities and calculate their tax liability for the Hawaii Department of Taxation. The filing of Form N-30 is a declaration of a corporation’s income, deductions, and credits for a specific tax year, ensuring businesses contribute to state revenues based on their profitability.
Determining Filing Requirements
All domestic and foreign corporations that conduct business in Hawaii and are subject to state income tax must file Form N-30. This requirement primarily applies to C corporations, and “transacting business” can include having employees, owning property, or deriving income from sources within Hawaii. For calendar-year filers, the return is due on or before April 20th, while fiscal-year filers must file by the 20th day of the fourth month after their fiscal year ends. A corporation can get an automatic six-month filing extension by submitting Form N-301, but this does not extend the time to pay any tax owed.
Information and Documentation Needed to Complete Form N-30
A complete and accurate federal corporate tax return, Form 1120, is a primary requirement, as much of the information from the federal return is transferred to the state form. Key pieces of information needed include the corporation’s Federal Employer Identification Number (FEIN), its principal business activity code, and its Hawaii Tax ID number.
The official Form N-30 and its instructions can be downloaded from the Hawaii Department of Taxation’s website. The form requires reporting gross receipts and other income, subtracting allowable business expenses, and providing a balance sheet that details the corporation’s assets, liabilities, and equity.
For specific financial activities, additional schedules may be necessary. For instance, Schedule D is used to report capital gains and losses, while Schedule O is for corporations that need to apportion their income between Hawaii and other states.
Filing and Payment Procedures
The Hawaii Department of Taxation offers multiple filing options. Corporations can mail a paper copy of the return or file electronically through approved software vendors. When a tax payment is due, it can be made by check or money order with the mailed return, accompanied by Form N-201V, the Business Income Tax Payment Voucher. Payments can also be made via electronic funds transfer (EFT) or through the state’s online payment portal.
Handling Estimated Taxes and Amended Returns
Corporations that expect to have a tax liability of more than $500 for the year are required to make estimated tax payments. The declaration of estimated taxes is made using Form N-3, and the payments are submitted with Form N-201V, Business Income Tax Payment Voucher. The purpose of estimated taxes is to ensure that corporations pay their tax liability incrementally as they earn income, rather than in a single lump sum at the end of the year. This helps to avoid a large tax bill and potential underpayment penalties.
If a corporation discovers an error on a previously filed Form N-30, it must file an amended return. This can be done by filing Form N-30X, Amended Corporation Income Tax Return. Alternatively, a corporation can file a standard Form N-30, check the box indicating it is an amended return, and attach Schedule AMD to explain the changes.