Exclusion of tips from state income tax for employees in Hawaii.

The bill proposes to amend Hawaii's tax code to exclude tips from state income tax. Tips, defined as gratuities or voluntary monetary contributions received by employees, will be excluded from gross income, adjusted gross income, and taxable income. The Director of Taxation will prepare necessary forms and may require evidence from employers. This change aims to support local small businesses by making employment more attractive. The amendment will apply to taxable years beginning after December 31, 2025.

Exclusion of tips from state income tax for employees in Hawaii.

The bill proposes to amend Hawaii's tax code to exclude tips from state income tax. Tips, defined as gratuities or voluntary monetary contributions received by employees, will be excluded from gross income, adjusted gross income, and taxable income. The Director of Taxation will prepare necessary forms and may require evidence from employers. This change aims to support local small businesses by making employment more attractive. The amendment will apply to taxable years beginning after December 31, 2025.