If you meet certain eligibility criteria, you may be eligible to receive an Oahu property tax credit that is equivalent to the amount of taxes you owed for the 2019-2020 tax year that exceeds three percent of the combined gross income of the property’s titleholders. If you want to take advantage of this tax credit, however, you need to act quickly, as the deadline for applying for the credit is rapidly approaching.
Do I Qualify?
To qualify for the tax credit, you must meet the following eligibility criteria:
- You have a home exemption in effect on the property at the time of your application as well as during the tax year of July 1, 2020 through June 30, 2021. If your property does not have the exemption, you will have to wait another year before you can apply for the credit.
- You and any other titleholder do not own any other property.
- The combined income of all of the titleholders during the 2018 calendar year did not exceed $60,000. This includes all taxable and non-taxable income for that calendar year.
- None of the titleholders are in violation of Revised Ordinance of Honolulu Section 8-13.5 by filing a fraudulent application or attesting to false statements with the intent to defraud the city or evade payment of real property taxes.
How Much is the Credit?
The credit is equivalent to three percent of the total income of the homeowner(s), with any property tax in excess of that three percent figure being the credit amount. If the calculated credit amount is more than your annual property tax, the credit will be zero, as the credit only applies when your annual property tax is more than three percent of your income.
How Do I Receive My Credit?
If you qualify and apply for the credit in time, it will be credited to your property taxes for the following year. When your bill arrives for the following year, you will see the credit reflected on the bill and deducted from the net property tax due.
How Do I Apply for the Oahu Property Tax Credit?
The forms that you need to complete for the property tax credit are released on July 1st every year. Completed forms are due back to the Division of Treasury by 4:30 pm on September 30th of each year. If being delivered by mail, applications must be postmarked no later than September 30th. You must reapply for the tax credit every year.
Are There Any Penalties Associated with the Tax Credit?
If you qualify for the tax credit, you should certainly apply to receive it. If you file a false application in order to gain the credit, however, you may face a criminal fine of up to $2,000. In addition, homeowners who obtained the tax credit but who are no longer eligible may face a fine of $200. If your situation changes, such as taking a title on another property, you should notify the City and the County of Honolulu within 30 days in order to avoid this fine.
