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Hawaii Free Printable Form N-346 (Rev. 2020) Tax Credit for Research Activities for 2024 Hawaii Tax Credit for Research Activities (Rev. 2016)

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Tax Credit for Research Activities (Rev. 2016)
Form N-346 (Rev. 2020) Tax Credit for Research Activities

Clear Form STATE OF HAWAII—DEPARTMENT OF TAXATION FORM TAX CREDIT FOR RESEARCH ACTIVITIES TAX YEAR N-346 Or fiscal year beginning ________________, 20___, and ending _________________, 20____ 20__ (REV. 2020) ATTACH TO FORM N-11, N-15, N-20, N-30, N-35, N-40, OR, N-70NP Name(s) as shown on tax return SSN or FEIN   NOTE: If you received a Schedule K-1 from a flow-through entity, skip lines 1 and 2 and start on line 3. 1 Enter the amount of your eligible research expenses reported on federal Form(s) 6765 for the tax year and the amount of your eligible research expenses attributable to research activity conducted IN HAWAII for the tax year: (See instructions. Attach a copy of federal Form(s) 6765). Column A Column B Reported On federal Form 6765 IN HAWAII a Certain amounts paid or incurred to energy consortia... 1a b Basic research payments to qualified organizations............ 1b c Wages for qualified services (do not include wages used in figuring the federal work opportunity credit)........................ 1c d Cost of supplies...................... 1d e Rental or lease costs of computers............................... 1e f Enter the applicable percentage of contract research expenses................. 1f g Total Eligible Research Expenses. Add lines 1a through 1f, and enter result..... 1g 2 Tentative tax credit for research activities. Multiply the amount in line 1g, Column B by 0.20 (20%)................................................... 2 3 Flow through of Hawaii tax credit for research activities received from other entities, if any. Check the applicable box below. Enter the name and Federal Employer I.D. No. of Entity:     a Partner — enter appropriate amount from Schedule K-1 (Form N-20)....................... b S Corp. shareholder — enter the appropriate amount from Schedule K-1 (Form N-35) ......... c Beneficiary — enter the appropriate amount from the Schedule K-1 (Form N-40). d Patron — enter the amount from federal Form 1099-PATR..................................... 3 4 Total credit allowed — Add lines 2 and 3. Enter the result here, rounded to the nearest dollar, and on the appropriate line for the credit on Schedule CR. For Pass-through entities, enter this amount on the appropriate lines of your tax return............................... 4 N346_I 2020A 01 VID01 ID NO 01 FORM N-346 (REV. 2020) GENERAL INSTRUCTIONS Note: In order to claim the Hawaii tax credit for research activities, you must also claim the federal tax credit for increasing research activities under section 41 of the Internal Revenue Code (IRC). Note: The tax credit for research activities can only be claimed by qualified high technology businesses. “Qualified high technology business” is defined in section 235-7.3(c), Hawaii Revised Statutes. Act 270, Session Laws of Hawaii (SLH) 2013 (Act 270), which reenacts the Hawaii tax credit for research activities (TCRA), applies to taxable years beginning after December 31, 2012, and sunsets for taxable years beginning after December 31, 2019. In particular, Act 270 adopts IRC section 41 as of December 31, 2011, with the further requirement that eligible research expenses do not include research expenses incurred outside of Hawaii. If the amount of the Hawaii credit exceeds the amount of the taxpayer’s Hawaii tax liability (if any) for the applicable tax year, the difference is refunded to the taxpayer. Significantly, Act 270 adopts the base amount as set forth under IRC section 41(c), such that only the increasing incremental amounts are eligible for the credit. Act 270 also requires that in order for a taxpayer to claim the Hawaii TCRA, said taxpayer must also claim the federal tax credit for increasing research activities under IRC section 41. For more information, see Tax Information Release No. 2013-02. Act 261, SLH 2019, amends the TCRA by extending the credit through 2024, allowing the credit to be claimed for all research expenses incurred in Hawaii without regard to the amount of expenses for previous years (base amount), and imposing an annual cap of $5,000,000, effective for taxable years beginning after December 31, 2019. Purpose of Form Use Form N-346 to figure and claim the TCRA under section 235110.91, Hawaii Revised Statutes (HRS). Who May Claim the Credit This credit may be claimed by a qualified high technology business (QHTB) as defined under section 235-7.3(c), HRS. Any partnership, S corporation, estate, trust, or cooperative that allocates this credit (including a pro rata share of the credit from a flow-through entity) must attach Form N-346, Form N-346A, and federal Form 6765 to its income tax return. Taxpayers claiming their pro rata share of the credit must also attach a copy of their Schedule K-1s. When the Credit May Not Be Claimed This credit may not be claimed if either of the following apply to your tax situation: (1) you are not claiming the federal tax credit for research activities under IRC section 41. (2) You have no eligible Hawaii research expenses. Credit Requirements To claim the credit, the following requirements must be satisfied: (1) The credit must be certified by the Department of Business, Economic Development and Tourism (DBEDT). See Form N-346A for more information. (2) The credit form (Form N-346), certification form (Form N-346A), federal Form 6765, Schedule K-1s (pro rata share credit claims), and Schedule CR (for tax returns for which Schedule CR is required) must be attached PAGE 2 to the taxpayer’s income tax return. (3) The QHTB must complete an annual survey as prescribed by DBEDT. See DBEDT’s website dbedt.hawaii.gov for more information. Failure to satisfy these requirements shall constitute a waiver of the right to claim the credit. The total amount of the certified tax credits is limited to $5,000,000 in the aggregate for all taxpayers in every taxable year after December 31, 2019, provided that no claim for the tax credit shall be made for research expenses incurred after December 31, 2024. Certification is issued on a first-come, first-served basis. Calculation of the Hawaii TCRA In order for a taxpayer to compute the amount of the Hawaii TCRA, it is necessary for the taxpayer to compute the amount of the eligible research expenses for research activities conducted in Hawaii. Calculate the Hawaii TCRA by multiplying the eligible Hawaii research expenses by 0.20 (20%). Deadline For Claiming the Credit The deadline to claim the credit, including amended claims, is 12 months after the close of your taxable year. You cannot claim the credit after the deadline. SPECIFIC INSTRUCTIONS Note: If you are claiming your share of the TCRA from a partnership, S corporation, estate, trust, or cooperative, skip lines 1 through 4 and start on line 5. Enter your fiscal or short tax year in the space provided. Line 1a through 1f, Column A — Enter in Column A the amount of the eligible research expenses reported on federal Form(s) 6765 for the tax year. Attach a copy of your federally filed Form 6765(s) for the tax year to Form N-346. Note: The tax credit is allocated by DBEDT on a calendar year basis. This means that after tax year 2020, the tax credit allocated to a fiscal year taxpayer may cover eligible research expenses incurred by the taxpayer in the same year as the calendar year and in the previous tax year. In this case, the fiscal year taxpayer may need to attach federal Forms 6765 that were filed for more than one tax year. Lines 1a through 1f, Column B — Enter in Column B the amount of the eligible research expenses attributable to research activity conducted IN HAWAII for the tax year and which are part of the amounts reported on lines 2a through 2f, Column A. Note: Expenses attributable to research activities OUTSIDE HAWAII do not qualify for the credit. Line 2 — Multiply the amount on line 1g, Column B by 0.20 (20%). Enter the result here. This is your tentative TCRA. Line 3 — If you are claiming your share of the TCRA from a partnership, S corporation, estate, trust, or cooperative, then enter the amount here. Also, enter the name and federal employer identification number of any flow-through entity who has passed the TCRA through to you. If additional space is needed, include the information on an attached schedule. Line 4 — Add lines 2 and 3. This is your total TCRA allowed for the tax year. Enter the amount here, rounded to the nearest dollar, and on the appropriate line for the credit on Schedule CR. For pass-through entities, enter this amount on the appropriate lines of your tax return.
Extracted from PDF file 2023-hawaii-form-n-346.pdf, last modified December 2013

More about the Hawaii Form N-346 Corporate Income Tax Tax Credit TY 2023

We last updated the Tax Credit for Research Activities (Rev. 2016) in February 2024, so this is the latest version of Form N-346, fully updated for tax year 2023. You can download or print current or past-year PDFs of Form N-346 directly from TaxFormFinder. You can print other Hawaii tax forms here.

Related Hawaii Corporate Income Tax Forms:

TaxFormFinder has an additional 164 Hawaii income tax forms that you may need, plus all federal income tax forms. These related forms may also be needed with the Hawaii Form N-346.

Form Code Form Name
Form N-346A Certified Statement of Research and Development Company

Download all HI tax forms View all 165 Hawaii Income Tax Forms


Form Sources:

Hawaii usually releases forms for the current tax year between January and April. We last updated Hawaii Form N-346 from the Department of Taxation in February 2024.

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Form N-346 is a Hawaii Corporate Income Tax form. States often have dozens of even hundreds of various tax credits, which, unlike deductions, provide a dollar-for-dollar reduction of tax liability. Some common tax credits apply to many taxpayers, while others only apply to extremely specific situations. In most cases, you will have to provide evidence to show that you are eligible for the tax credit, and calculate the amount of the credit to which you are entitled.

About the Corporate Income Tax

The IRS and most states require corporations to file an income tax return, with the exact filing requirements depending on the type of company.

Sole proprietorships or disregarded entities like LLCs are filed on Schedule C (or the state equivalent) of the owner's personal income tax return, flow-through entities like S Corporations or Partnerships are generally required to file an informational return equivilent to the IRS Form 1120S or Form 1065, and full corporations must file the equivalent of federal Form 1120 (and, unlike flow-through corporations, are often subject to a corporate tax liability).

Additional forms are available for a wide variety of specific entities and transactions including fiduciaries, nonprofits, and companies involved in other specific types of business.

Historical Past-Year Versions of Hawaii Form N-346

We have a total of ten past-year versions of Form N-346 in the TaxFormFinder archives, including for the previous tax year. Download past year versions of this tax form as PDFs here:


2023 Form N-346

Form N-346 (Rev. 2020) Tax Credit for Research Activities

2022 Form N-346

Form N-346 (Rev. 2020) Tax Credit for Research Activities

2021 Form N-346

Form N-346 (Rev. 2020) Tax Credit for Research Activities

2020 Form N-346

Form N-346 (Rev. 2020) Tax Credit for Research Activities

2019 Form N-346

Form N-346 (Rev. 2019) Tax Credit for Research Activities

2018 Form N-346

Form N-346 (Rev. 2018) Tax Credit for Research Activities

2017 Form N-346

Form N-346 (Rev. 2016) Tax Credit for Research Activities

2016 Form N-346

Form N-346 (Rev. 2016) Tax Credit for Research Activities

Forms 2015 2015 Form N-346

Form N-346 (Rev. 2015) Tax Credit for Research Activities

Tax Credit for Research Activities 2014 Form N-346

Form N-346 (Rev. 2014)


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