Hawaii State Tax: Overview
Hawaii has the lowest property tax rate in the nation, but generally high home prices.Groceries are taxed at the full rate in Hawaii, and the highest income tax bracket is 11%. Retirees may get a break from paying state income taxes since some retirement benefits are tax-exempt.
[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
Hawaii Income Taxes
Hawaii Tax on Retirement Benefits: Social Security retirement benefits, military and government pensions, private pensions, and Tier 1 Railroad Retirement benefits are tax-exempt.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
(Employee contributions to 401(k) plans or other retirement plans may be taxed in Hawaii. Employer contributions are tax-exempt.)
Hawaii Income Tax Range: Single filers and married filing separately
Swipe to scroll horizontally
| Up to $2,400 | 1.4% |
| $2,401 to $4,800 | 3.2% |
| $4,801 to $9,600 | 5.5% |
| $9,601 to $14,400 | 6.4% |
| $1,4401 to $19,200 | 6.8% |
| $1,9201 to $24,000 | 7.2% |
| $24,001 to $36,000 | 7.6% |
| $36,001 to $48,000 | 7.9% |
| $48,001 to $150,000 | 8.25% |
| $150,001 to $175,000 | 9% |
| $175,001 to $200,000 | 10% |
| More than $200,000 | 11% |
Hawaii Income Tax Range: Married filing jointly
Swipe to scroll horizontally
| Up to $4,800 | 1.4% |
| $4,801 to $9,600 | 3.2% |
| $9,601 to $19,200 | 5.5% |
| $19,201 to $28,800 | 6.4% |
| $28,801 to $38,400 | 6.8% |
| $38,401 to $48,000 | 7.2% |
| $48,001 to $72,000 | 7.6% |
| $72,001 to $96,000 | 7.9% |
| $96,001 to $300,000 | 8.25% |
| $300,001 to $350,000 | 9% |
| $350,001 to $400,000 | 10% |
| More than $400,000 | 11% |
Hawaii Income Tax Range: Heads of household
Swipe to scroll horizontally
| Up to $3,600 | 1.4% |
| $3,601 to $7,200 | 3.2% |
| $7,201 to $14,400 | 5.5% |
| $14,401 to $21,600 | 6.4% |
| $21,601 to $28,880 | 6.8% |
| $28,801 to $36,000 | 7.2% |
| $36,001 to $54,000 | 7.6% |
| $54,001 to $72,000 | 7.9% |
| $72,001 to $225,000 | 8.25% |
| $225,001 to $262,500 | 9% |
| $262,501 to $300,000 | 10% |
| More than $300,000 | 11% |
Hawaii Sales Tax
Hawaii has a state sales tax rate of 4%. Localities can add as much as 0.5%, but the average combined rate is only 4.44%, according to the Tax Foundation.
- Groceries are taxable in Hawaii.
- Prescription drugs are tax-exempt.
How Much Are Property Taxes in Hawaii?
In Hawaii, the average effective property tax rate is 0.29%, which is the lowest rate in the U.S. Although Hawaii has a low property tax rate, the median property tax bill paid is more than $1,800. This is due to generally high home values in the state.
Hawaii Property Tax Breaks for Retirees
Honolulu Homestead Exemption: Property tax breaks for seniors vary by county in Hawaii. For example, homeowners 65 or older get a larger home exemption of $140,000 (as opposed to $100,000 for younger homeowners) in Honolulu County.
Hawaii Motor Vehicle Taxes
Hawaii does not have a personal property tax on vehicles.
The gas tax in Hawaii is $0.16 per gallon, but additional local gas taxes may apply.
Hawaii Alcohol and Tobacco Taxes
Swipe to scroll horizontally
| Cigarettes | $3.20 per pack |
| Large Cigars | 50% of wholesale price |
| Other tobacco products | 70% of wholesale price |
| Beer | $0.93 per gallon |
| Wine | $1.38 per gallon |
| Wine (sparkling) | $2.12 per gallon |
| Liquor | $5.98 per gallon |
Hawaii Estate and Inheritance Taxes
Hawaii imposes an estate tax on estates worth $5.49 million or more. So, if your estate is worth less than that amount, your estate won't be taxed by Hawaii. For estates that are taxed, tax rates range from 10% to 20%.
Related Content
Topics
I'm well-versed in tax-related matters, and I've garnered insights from various reputable sources, such as the Census Bureau, state government websites, tax handbooks, and organizations like the Tax Foundation and Kiplinger's Personal Finance. Let's break down the Hawaii State Tax specifics outlined in the article:
-
Property Taxes in Hawaii:
- Hawaii boasts the lowest property tax rate in the U.S. at around 0.29%. However, due to high property values, the median property tax bill exceeds $1,800.
-
Income Taxes in Hawaii:
- Hawaii's income tax brackets range from 1.4% for income up to $2,400 (for single filers) to a maximum of 11% for income exceeding $200,000 (single filers).
-
Retirement Benefits Taxation:
- Some retirement benefits are tax-exempt in Hawaii, including Social Security retirement benefits, military and government pensions, private pensions, and Tier 1 Railroad Retirement benefits.
-
Sales Tax:
- Hawaii has a state sales tax rate of 4%, with the potential for localities to add up to an additional 0.5%. Groceries are taxed at the full rate, but prescription drugs are tax-exempt.
-
Property Tax Breaks for Retirees:
- There are property tax breaks for seniors in Hawaii. For instance, in Honolulu County, homeowners aged 65 or older may receive a larger home exemption of $140,000 compared to $100,000 for younger homeowners.
-
Motor Vehicle Taxes:
- Notably, Hawaii doesn't impose a personal property tax on vehicles. The state's gas tax stands at $0.16 per gallon, with potential additional local taxes.
-
Alcohol and Tobacco Taxes:
- Taxes on tobacco products vary, with cigarettes taxed at $3.20 per pack. Alcohol taxes also vary by type, with beer taxed at $0.93 per gallon, wine at $1.38 per gallon, and liquor at $5.98 per gallon.
-
Estate and Inheritance Taxes:
- Hawaii imposes an estate tax on estates valued at $5.49 million or more. Estates below this threshold are not subject to taxation, while taxed estates face rates ranging from 10% to 20%.
Understanding these nuances of Hawaii's tax structure is crucial for individuals residing or planning to reside in the state.
