Informing the Legislature that on June 19, 2024, the Governor signed the following bill into law: SB2725 HD1 CD1 (ACT 050).

This bill, officially titled Act 050, amends Hawaii's pass-through entity taxation laws to allow small business owners to carry forward unused state income tax credits to future years. It directly affects S corporations, partnerships, and limited liability companies that previously elected to pay taxes at the business level under a 2023 law. The key change replaces the previous rule that expired unused tax credits with a new provision letting qualified members apply those credits against their net income tax liability until fully exhausted. Additionally, the bill updates the definition of eligible taxpayers and adjusts the calculation method for the entity-level tax rate.