All Forum Posts by: Chris Hicks

Yes .8% my apologies. Rent would be between $2800-$3000. If it rents for $2800 just to get someone in the place then profits would be $300, which is under 1%. If it rents for $3000, profits would be $500 all after expenses which is slightly over 1%.

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In a potential situation for primary to become rental. Only thing is HOA eats into rental profits causing me to go below the 1% rule, more like .08%. The property has appreciated almost 100k within the year, but I would like to keep it long term. Don't know if I should take profits and get something better or rent it out. HOA has a good amount in reserves, hasn't had any special assessment fees and covers everything except gas and electric which is pretty attractive for future tenants.

Any advice is greatly appreciated.

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@Bleys Wright

Got it. Thank you.

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@Bleys Wright

Do they pay for it themselves or do you collect it from them, then pay?

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@Paul Winchell

Thanks for response,

It is my first time hearing of a sales tax on RE long term rentals or sales tax on RE rentals in general. I've seen them on short term rentals in different cities especially for AIRBNB. Again, Thanks for response. Just new information to me.

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Hello All,

Just trying to get some clarification on why HI has a GET (General Excise Tax) on gross rent. I have searched around with no answers. I understand that you have to pay taxes on rental PROFIT. But HI charges a GET on gross income regardless if you make a profit or not, then again for the profit once you file your yearly annual taxes for State. The State requires you to file for your GET tax monthly, quarterly, or semi-annually depending on the amount of GET you will owe. The State says the GET is for any business operated in HI. But again to my knowledge your getting taxed twice. Any clarification would be greatly appreciated.

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Just beware, HI has a GET Tax that eats into your rental profits along with paying income tax.

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Originally posted by @Colby Hanley:

Aloha Maxwell,

Hawaii Taxes you Might Owe:
Hawaii state income tax returns are due each year you rent property on Hawaii. This is true whether or not your rental creates taxable income or not. There can be significant differences between federal and Hawaii depreciation allowances and it is possible that you owe Hawaii state income tax on the rental even if you did not show a profit on your federal return.

Hawaii General Excise Tax (GET) of 4.00-4.50% is due on all long term rental of over 30 days. GET and Transient Accommodation Tax (TAT) of 10.25-10.50% is due on all short term rentals of under 30 days. The HARPTA withholding is collected to ensure non-Hawaii resident sellers of real estate pay any state taxes connected to the transaction.

You are subject to Hawaii capital gains tax of up to 7.25% on the profit (gain) realized on the transaction.
Once you are current on all of the taxes above, you are eligible to file for an early refund of the withheld tax based on an estimate of the tax you may owe. If your estimate is zero, you may be able to recover the entire amount prior to filing your next HI state income tax returns. NOTE: Any unfiled GET/TAT/Income tax returns must be filed prior to receiving a HARPTA refund.

Here is a calculator that might help, it is from a local Title company that I like to use. http://express.tghawaii.co

Currently long term rentals are considered any rental over 180 days and has to be same tenant.

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All Forum Posts by: Chris Hicks

Chris Hicks has started 2 posts and replied 12 times.

Post: What's your non-real estate side hustle these days?

Post: Going below 1% Rule.

Post: Going below 1% Rule.

Post: Going below 1% Rule.

Post: General Excise Tax on Rental Income Hawaii

Post: General Excise Tax on Rental Income Hawaii

Post: General Excise Tax on Rental Income Hawaii

Post: General Excise Tax on Rental Income Hawaii

Post: Hawaii

Post: State Level Tax Question San Diego & Hawaii