HB 753 Hawaii House · 2025 Regular Session

RELATING TO THE HOUSEHOLD AND DEPENDENT CARE SERVICES TAX CREDIT.

Summary

Increases a taxpayer's applicable percentage of employment-related expenses that is used to calculate the household and dependent care services tax credit. Extends the sunset date of the temporary increase in maximum employment-related expenses that are used to calculate the household and dependent care services tax credit, established by Act 163, SLH 2023, to 6/30/2030. Effective 7/1/3000. Sunsets 6/30/3005. (HD1)

Bill status in committee 1 of 4 stages cleared

Introduction

Jan 2025

Committee Review

Floor Vote

Governor

Introduced Jan 17, 2025 Last action Feb 11, 2025

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What changed between versions

HB753 → HB753_HD1 · 5 edits

MODERATE

HB 753 HD1 significantly revises Hawaii's household and dependent care services tax credit by replacing the previous income-based sliding percentage scale with a new, more generous percentage structure that increases as income decreases. The bill also clarifies definitions of qualifying individuals and employment-related expenses, extends the sunset date for certain provisions from 2027 to 2030, and updates the effective date to July 1, 2025. These changes aim to provide greater financial relief to working families by allowing a higher percentage of child care expenses to be claimed as a tax credit.

Scope change

The bill expands the scope of the tax credit by increasing the applicable percentage for all income levels and clarifying eligibility criteria for qualifying individuals and care providers.

ELIGIBILITY

Replaced the previous income-based percentage scale (50% reduced by 1% for each $3,000 over $150,000 AGI) with a new fixed percentage scale ranging from 25% for incomes under $25,000 down to 15% for incomes over $50,000.

DEFINITION

Added new definitions for 'dependent care center' and clarified rules for spouses who are students or incapable of caring for themselves, including special dependency test rules for divorced parents.

TIMELINE

Extended the sunset date for the temporary increase in maximum employment-related expenses from June 30, 2027 to June 30, 2030, and updated the effective date to July 1, 2025.

REQUIREMENT

Added requirements for identifying information on service providers, including taxpayer identification numbers and general excise tax license numbers, with exceptions for out-of-state providers and tax-exempt organizations.

ENFORCEMENT

Established a disallowance period of ten years for fraud and two years for other disallowances, preventing taxpayers from claiming the credit during these periods.

Floor votes

How they voted

No floor votes recorded yet.

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Feb 11, 2025

Committee

Report adopted; referred to the committee(s) on FIN with none voting aye with reservations; none voting no (0) and Representative(s) Cochran, Ward excused (2).

lower

Feb 11, 2025

Committee

Reported from ECD (Stand. Com. Rep. No. 334), recommending referral to FIN.

lower

Feb 5, 2025

Lower · Passed

The committee on ECD recommend that the measure be PASSED, UNAMENDED. The votes were as follows: 7 Ayes: Representative(s) Ilagan, Hussey, Holt, Tam, Templo, Todd, Matsumoto; Ayes with reservations: none; Noes: none; and Excused: none.

lower

Jan 30, 2025

Committee

Reported from HSH (Stand. Com. Rep. No. 5) as amended in HD 1, recommending passage on Second Reading and referral to ECD.

lower

Jan 28, 2025

Lower · Passed

The committee on HSH recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 8 Ayes: Representative(s) Marten, Olds, Amato, Chun, Keohokapu-Lee Loy, Takayama, Takenouchi, Garcia; Ayes with reservations: none; Noes: none; and 1 Excused: Representative(s) Alcos.

lower

Jan 21, 2025

Committee

Referred to HSH, ECD, FIN, referral sheet 2

lower

Jan 21, 2025

Introduced

Introduced and Pass First Reading.

lower

Jan 17, 2025

Introduced

Pending introduction.

lower

10 primary · 0 co-sponsors