PART I. 
GENERAL PROVISIONS



 



§235-1  Definitions.



"Biotechnology" means fundamental
knowledge regarding the function of biological systems from the macro level to
the molecular and subatomic levels that has application to development
including the development of novel products, services, technologies, and
subtechnologies from insights gained from research advances that add to that
body of fundamental knowledge.



"Blind" means a person whose central
visual acuity does not exceed 20/200 in the better eye with correcting lenses,
or whose visual acuity is greater than 20/200 but is accompanied by a
limitation in the field of vision such that the widest diameter of the visual
field subtends an angle no greater than twenty degrees.  The impairment of
sight shall be certified to on forms prescribed by the department of taxation
on the basis of a written report on an examination performed by a qualified
ophthalmologist or qualified optometrist.



"Computer data" means any
representation of information, knowledge, facts, concepts, or instructions that
is being prepared or has been prepared and is intended to be processed, is
being processed, or has been processed in a computer or computer network.



"Computer program" means an ordered
set of computer data representing coded instructions or statements, that, when
executed by a computer, causes the computer to perform one or more computer
operations.



"Computer software" means computer
data, a computer program, or a set of computer programs, procedures, or
associated documentation concerned with the operation and function of a
computer system, and includes both systems and application programs and
subdivisions, such as assemblers, compilers, routines, generators, and utility
programs.



"Corporation" means the same as in the
Internal Revenue Code.  A "domestic corporation" is one organized
under the laws of the State.  A "foreign corporation" is any other
corporation.



"Deaf" means a person whose average
loss in the speech frequencies (500-2000 Hertz) in the better ear is eighty-two
decibels, A.S.A., or worse.  The impairment of deafness shall be certified to
by a qualified otolaryngologist or a licensed audiologist under chapter 468E on
forms prescribed by the department of taxation.



"Dividend" means any distribution by
a corporation to its shareholders or holders on an interest therein which is
treated as a dividend by the Internal Revenue Code.



"Employee" means the same as in the
Internal Revenue Code.



"Fiduciary" means the same as in the
Internal Revenue Code.



"Fiscal year" means the same as in
the Internal Revenue Code.



"Gross income", "adjusted gross
income", "ordinary income", "ordinary loss", and
"taxable income" respectively mean the same as gross income, adjusted
gross income, ordinary income, ordinary loss, and taxable income as defined and
determined under the Internal Revenue Code, except as otherwise provided in
this chapter.



"Head of household" means any
individual who qualifies as a head of household under the Internal Revenue
Code.



"Husband and wife" means the same as
in the Internal Revenue Code.



"Income tax law of 1901" means the
income tax law enacted by Act 20 of the Session Laws of 1901 as it read from
time to time prior to the enactment of the income tax law of 1932.



"Income tax law of 1932" means the
income tax law enacted by Act 44 of the Second Special Session Laws of 1932, as
it read from time to time prior to the enactment of the income tax law of 1957.



"Income tax law of 1957" means the
income tax law enacted by the Twenty-Ninth Legislature, as it reads from time
to time.



"Includes" and "including"
when used in a definition shall not be deemed to exclude other things otherwise
within the meaning of the term defined.



"Individual" means a person other
than a trust, estate, partnership, or corporation, as defined.



"Internal Revenue Code of 1954, as
amended" includes the Internal Revenue Code of 1986 and the Internal
Revenue Code of 1986, as amended.



"Investment" means a nonrefundable
investment, at risk, as that term is used in section 465 (with respect to
deductions limited to amount at risk) of the Internal Revenue Code, in a
qualified high technology business, of cash that is transferred to the
qualified high technology business, the transfer of which is in connection with
a transaction in exchange for stock, interests in partnerships, joint ventures,
or other entities, licenses (exclusive or nonexclusive), rights to use
technology, marketing rights, warrants, options, or any items similar to those
included in this definition, including but not limited to options or rights to
acquire any of the items included in this definition.  The nonrefundable
investment is entirely at risk of loss where repayment depends upon the success
of the qualified high technology business.  If the money invested is to be
repaid to the taxpayer, no repayment except for dividends or interest shall be
made for at least one year from the date the investment is made.  The annual
amount of any dividend and interest payment to the taxpayer shall not exceed
twelve per cent of the amount of the investment.



"Nonresident" means every individual
other than a resident.



"Nonresident estate" or
"nonresident trust" means one other than resident.



"Paid or incurred, paid or accrued"
means the same as in the Internal Revenue Code.



"Partner" means the same as in the
Internal Revenue Code.



"Partnership" means the same as in
the Internal Revenue Code.



"Person" includes an individual, a
trust, estate, partnership, association, company, or corporation.



"Person totally disabled" means a
person who is totally and permanently disabled, either physically or mentally,
which results in the person's inability to engage in any substantial gainful
business or occupation.



The disability shall be certified to by (1) a
physician or osteopathic physician licensed under chapter 453, (2) a qualified
out-of-state physician who is currently licensed to practice in the state in
which the physician resides, or (3) a commissioned medical officer in the
United States Army, Navy, Marine Corps, or Public Health Service, engaged in
the discharge of one's official duty.  Certification shall be on forms
prescribed by the department of taxation.



"Prepaid legal service plan"
("Plan") means a group legal service plan in which the cost of the
services are prepaid by the group member or by some other person or
organization in the member's behalf.  A group legal service plan is a plan by
which legal services are rendered to individual members of a group identifiable
in terms of some common interest.  A plan shall provide:



(A) That individual members shall be afforded freedom
of choice in the selection of their own attorney or attorneys to provide legal
services under such plan.



(B) For the payment of equal amounts for the cost of
services rendered without regard to the identity of the attorney or attorneys
selected by the plan member or members.  No plan shall otherwise discriminate
on the basis of such selection.



"Regulated investment company" means
a corporation which qualifies as such under sections 851 and 852 of the
Internal Revenue Code.



"Resident" means (1) every individual
domiciled in the State, and (2) every other individual whether domiciled in the
State or not, who resides in the State.  To "reside" in the State
means to be in the State for other than a temporary or transitory purpose. 
Every individual who is in the State more than two hundred days of the taxable
year in the aggregate shall be presumed to be a resident of the State.  This
presumption may be overcome by evidence satisfactory to the department of
taxation that the individual maintains a permanent place of abode outside of
the State and is in the State for a temporary or transitory purpose.  No person
shall be deemed to have gained or lost a residence simply because of the
person's presence or absence in compliance with military or naval orders of the
United States, or while engaged in aviation or navigation, or while a student
at any institution of learning.



"Resident estate" means an estate of
a resident decedent the fiduciary of which was appointed by a court of this
State and the administration of which is carried on in this State, and
"resident trust" means a trust of which the fiduciary is a resident
of the State or the administration of which is carried on in the State.



"Shareholder" means the same as in
the Internal Revenue Code.



"Stock" means the same as in the
Internal Revenue Code.



"Taxable year" means the calendar
year or the fiscal year ending during such calendar year upon the basis of
which income is computed under this chapter.  "Taxable year"
includes, in the case of a return made for a fractional part of a year under
this chapter or under regulations prescribed by the department of taxation, the
period for which such return is made, and in cases where the department
terminates the taxable year in accordance with section 231-24 and levies a
jeopardy assessment on income for such portion or period of a year under
section 235-109, then the period or portion of the year for which the jeopardy
assessment is made.



"Taxpayer" means a person subject to
a tax imposed by this chapter.



"Trade or business" includes the
performance of the functions of a public office.



"Uniformed services of the United
States" means the Army, Navy, Air Force, Marine Corps, Coast Guard, Coast
and Geodetic Survey, and Public Health Service, and all regular and reserve
components thereof, including the National Guard.  The term "uniformed
services of the United States" applies only to persons who are deemed
members thereof under the laws of the United States relating to pay and
allowances.  Services as a member of the uniformed services includes inactive
duty training.



"Without regard to source in the
State" shall mean income derived or earned from all sources whether from
sources located within or from sources located without the State. [L Sp 1957, c
1 pt of §2; am L 1959, c 246, §13 and c 277, pt of §6; am L Sp 1959 2d, c 1,
§§16, 19; Supp, §121-1; am L 1967, c 250, §2; HRS §235-1; am L 1968, c 42, §3;
am L 1970, c 90, §1; am L 1971, c 97, §1; am L 1973, c 217, §10; am L 1974, c
42, §2; am L 1976, c 156, §5 and c 208, §1; am L 1978, c 173, §2(3), (4), and
(5); gen ch 1985; am L 1987, c 239, §1(4); am L 1988, c 81, §1; am L 1990, c
17, §1; am L 1997, c 178, §1; am L 2000, c 297, §4; am L 2001, c 36, §1; am L 2009,
c 11, §27]



 



Note



 



  The L 2009, c 11 amendment is retroactive to April 3, 2008. 
L 2009, c 11, §76(2).



 



Attorney General Opinions



 



  "Resident" clarified.  Att. Gen. Op. 65-5.



 



Case Notes



 



  Redemption of stock taxable as gain or profit held not dividend 
79 F.2d 761.



  "Taxable year".  33 H. 766.



  Abandonment of Hawaiian domicile and acquisition of new.  51
H. 339, 461 P.2d 131.