Hawaii tax changes for 2026: Key updates for taxpayers
Reading time: 4 minutes
February 20th, 2026
Ready to start your tax preparation? Here’s a quick refresher on what’s changed for Hawaii taxpayers.
Hawaii tax basics to keep in mind
Hawaii still has 12 individual income tax brackets, the most of any state. For tax year 2025, the state kept the higher standard deduction amounts that began with Act 46 and adopted updated brackets designed to lower taxes for many households.
New rules and tax changes for 2025 (filed in 2026)
A simpler year for Form 1099‑K: If you use payment apps or online marketplaces, you may have heard about shifting reporting rules. For 2025 returns, the IRS reinstated the long‑time threshold. This means you’ll only receive a 1099‑K if you had more than $20,000 in payments and over 200 transactions on a platform. Remember: even if you don’t get a form, all taxable income still needs to be reported.
Support for unexpected expenses
Life happens—and when it does, the IRS now gives you a bit more breathing room. Under SECURE 2.0, you may withdraw up to $1,000 from a retirement account once per year to cover an emergency expense, without the usual early‑withdrawal penalty. Your plan must allow it, the withdrawn funds must be vested, and normal income tax rules still apply, but this option can provide relief when you need it most.
Hawaii’s standard deduction and brackets
Hawaii continues implementing its multiyear tax relief plan. For 2025, the state standard deduction remains:
- $4,400 for single filers
- $6,424 for heads of household
- $8,800 for joint filers
Updated income tax brackets also apply this year, designed to ease the burden for many local households.
Earned Income Tax Credit: If you’re working and meet income limits, the federal EITC can significantly reduce your tax bill—or boost your refund. For tax year 2025, the maximum credit ranges from $649 (no children) up to $8,046 (three or more children).
Child Tax Credit: Families with children may qualify for up to $2,200 per qualifying child, with up to $1,700 refundable for the 2025 tax year. Income phase‑outs begin at $200,000 for single filers and $400,000 for married couples filing jointly.
Most tax software and professionals will screen you for the EITC and CTC automatically and help you document eligibility.
Need help preparing your taxes?
In Hawaii, there are several resources for people who would like assistance.
VITA & TCE: The IRS‑sponsored Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs offer free, reliable tax preparation statewide. Generally, VITA assists people who make $69,000 or less, individuals with disabilities, and limited English speakers. TCE focuses on community members age 60+.
Goodwill Hawaii: Goodwill Hawaii also provides free tax clinics each tax season, supported by IRS‑certified staff and volunteers.
2026 filing deadlines (for your 2025 return)
Federal deadline: Your 2025 federal return is due April 15, 2026. You can request an extension, but keep in mind: an extension gives you more time to file, not more time to pay.
Hawaii deadline: Hawaii returns are due April 20, 2026. The state offers an automatic six‑month extension (to October 20, 2026) if you’re due a refund or pay your estimated taxes by the April deadline. Payments should be submitted using Form N‑200V or through Hawaii Tax Online.
We’re here for you
Unfortunately, we can’t file your taxes for you. But at Bank of Hawaii, we can help you build healthy financial habits that could make next year’s filing feel even easier. Whether that means starting (or restarting) an emergency fund to cover next year’s withholding or opening a savings account to help you reach your possible, visit boh.com or talk to one of our local specialists.
This material is provided for educational purposes only and is not intended to be relied upon as research or tax, legal, investment, financial or accounting advice. You should consult your own tax, legal, investment, financial or accounting advisors before engaging in any activities or transactions.
Resources:
Internal Revenue Service
State of Hawaii Tax Year Information - 2025
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