Hawaii LLC Taxes: The Complete Filing Guide (2025)
Running an LLC in Hawaii means dealing with taxes at federal, state, and sometimes local levels. This guide simplifies everything you need to know to stay compliant and avoid surprises, from income tax and sales tax to city-specific requirements.
Recommended: Schedule a free consultation with 1-800Accountant to stay on top of your taxes.
Hawaii LLC Tax Basics
Navigating your Hawaii LLC tax obligations doesn’t have to be complicated. We’ll walk you through the essentials of pass-through taxation, explain Hawaii’s specific requirements, and highlight strategies to stay compliant and organized. This guide covers everything from federal income taxes to city-specific requirements and filing deadlines.
Use the links below to jump directly to the section you need:
- Hawaii LLC Taxes at a Glance
- Understanding LLC Taxation Basics
- Federal Tax Obligations
- Hawaii State Taxes
- Local Tax Considerations
- Tax Calendar and Filing Tips
- Tax Strategies for Hawaii LLCs
- Forms and Resources
Hawaii LLC Taxes at a Glance
| Tax Type | Rate | Filing Deadline | Forms Required |
|---|---|---|---|
| Federal Income Tax | 10%-37% (personal brackets) | April 15, 2025 | Form 1040 + Schedule C or Schedule E/K-1 |
| Self-Employment Tax | 15.3% | April 15, 2025 | Schedule SE |
| Hawaii Income Tax | 1.4%-11% | April 21, 2025 | Form N-11SF |
| Hawaii Corporate Income Tax | 4.4%-6.4% | April 20, 2025 | Form N-30 |
| Hawaii Pass-through Entity Tax | 9% (flat rate) | Quarterly (April 20, June 20, September 20, January 20) | Filed online |
| Federal Payroll Taxes (If Employees) | 7.65% employer + 7.65% employee (FICA) | Quarterly (April 30, July 31, October 31, January 31) | Form 941 |
| Hawaii Unemployment Tax (If Employees) | 2.4-5.6% | Quarterly (April 30, July 31, October 31, January 31) | Filed online |
| Federal Unemployment (FUTA) | 6% on first $7,000 per employee (0.6% after credits) | January 31, 2026 (annual) | Form 940 |
| State General Excise Tax | 4% | Periodically or annually | Form G-45/Form G-49 |
| Annual Report | $12.50-$15 | Varies by registration date | Form C5 |
Understanding LLC Taxation Basics
How Hawaii LLCs Are Taxed By Default
Your Hawaii LLC doesn’t pay taxes itself. Instead, profits flow through to you and your members, who report them on personal tax returns. This is called pass-through taxation.
Here’s how it works:
- Your LLC earns income from business activities
- The LLC itself files no tax return (unless you elect otherwise)
- Profits “pass through” to members based on ownership percentage
- Each member reports their share on their personal tax return
- Members pay tax at their individual income tax rates
What this means for you: Unlike corporations, your business profits are only taxed once, which typically saves money.
Time-Saving Tip: If you’re uncertain about your LLC’s tax classification, a tax professional can review your LLC’s tax setup in 30 minutes and help you choose the most tax-efficient option.
Tax Classification Options
While pass-through taxation is the default, your Hawaii LLC can choose alternative tax treatments:
Default LLC Tax Status:
- Single-member LLC: Taxed as a sole proprietorship
- Multi-member LLC: Taxed as a partnership
Optional Tax Classifications:
- S Corporation: Can reduce self-employment taxes by paying “reasonable salaries”
- C Corporation: LLC pays corporate tax on profits, members pay personal tax on distributions (creates double taxation)
Not sure which tax classification is right for your business? Schedule a free consultation with 1-800Accountant.
Federal Tax Obligations
Income Tax
As a Hawaii LLC owner, you’ll report your share of business profits on your personal tax return using:
- Form 1040 + Schedule C (single-member LLCs)
- Form 1040 + Schedule E + Schedule K-1 (multi-member LLCs)
Federal income tax rates range from 10% to 37% based on your tax bracket (actual brackets will depend on inflation adjustments and any tax law changes).
Simply Put: Whatever money your business makes (after expenses) gets added to your personal tax return, just like income from a job.
Self-Employment Tax
LLC members actively involved in the business must pay self-employment tax of 15.3% (covering Social Security and Medicare) on their share of LLC profits.
Key points:
- Applies to net earnings of $400 or more
- Calculated on Schedule SE
- You can deduct 50% of the self-employment tax as an “above-the-line” deduction, which lowers your adjusted gross income
What happens if I miss this payment? The IRS charges penalties of 0.5% per month plus interest. However, first-time mistakes can often qualify for penalty abatement if you have a clean compliance history.
Employment Taxes
If your LLC has employees, you must:
- Withhold federal income tax
- Pay and withhold FICA taxes (7.65% each for employer and employee)
- Pay federal unemployment tax (FUTA)
- File quarterly employment tax returns (Form 941)
- Provide W-2 forms annually
Estimated completion time: 2-3 hours per quarter (significantly less with payroll software or professional help)
Estimated Tax Payments
Because no tax is withheld from your LLC profits, you’ll likely need to make quarterly estimated tax payments using Form 1040-ES. These payments cover both income and self-employment taxes on your share of the business income. Missing deadlines or underpaying can lead to IRS penalties, even if you pay in full later.
Working with an accountant can help ensure accurate calculations, on-time payments, and a smarter overall tax strategy.
Key deadlines:
- April 15
- June 16
- September 15
- January 15
Pro Tip: Set calendar reminders 15 days before each deadline. This gives you time to prepare without the last-minute rush that leads to mistakes.
Hawaii State Taxes
Hawaii Individual Income Tax
Hawaii imposes an individual income tax rate of 1.4%-11% that applies to your LLC’s profits on your personal return. This tax is only applicable if your LLC has elected the default tax structure.
Filing requirements:
- Use Hawaii Form N-11SF
- Due April 21, 2025
Hawaii Corporate Income Tax
If you’ve elected to have your LLC taxed as a c corp, you will be responsible for Hawaii’s 4.4%-6.4% corporate income tax.
Filing requirements:
- Use Hawaii Form N-30
- Due April 20, 2025
Hawaii Pass-Through Entity Tax
Hawaii offers an optional 9% pass-through entity tax that helps LLCs taxed as partnerships or S corps reduce the impact of the federal $10,000 SALT deduction cap by allowing state income tax to be paid at the entity level.
Filing requirements:
- 9% flat rate
- Must be paid online via Hawaii Tax Online
- Due quarterly (April 20, June 20, September 20, January 20)
General Excise Tax
While Hawaii does not impose a sales and use tax, it does impose General Excise Tax (GET). This cost can be visibly passed onto customers but must be collected and reported by the business.
Filing requirements:
- Apply for a General Excise Tax License (Form BB-1, $20 filing fee)
- Collect 4% general excise tax on taxable sales
- Register for a sales tax license through Hawaii Department of Taxation
- File and pay collected taxes periodically or annually
- Use Hawaii Form G-45 (periodic filing) or Hawaii Form G-49 (annual filing)
Payroll Taxes
If you have employees in Hawaii, you will be responsible for two types of payroll taxes.
Unemployment Insurance (UI) Tax
- Register through the Hawaii Department of Labor and Industrial Relations
- Rate is 2.4% for new employers (2.4%-5.6% afterwards)
- Due quarterly
Withholding Tax
- Register for a withholding account through Hawaii Tax Online
- Rate is 1.4%-7.9% (must be calculated per employee)
- Due semi-weekly, monthly, or quarterly (determined by liability amount)
Annual Report Filing
While not a tax, your Hawaii LLC must file an annual report:
- Due date varies based on registration date
- $12.50 fee if filed online, $15 if filed by mail (plus $1 state archive fee)
- Filed using Hawaii Business Express or via Hawaii Form C5
Calendar Alert: Set a reminder for a month before your due date to ensure you don’t miss this easy but required filing.
Local Tax Considerations
Local General Excise Tax
Hawaii allows counties to impose local GET in addition to the state’s 4% general excise tax. Local GET returns are filed alongside state returns.
Counties with income taxes include:
- Honolulu (0.50%)
- Kauai (0.50%)
- Hawaii (0.25%)
- Maui (0.50%)
Property Taxes
If your LLC owns real property in Hawaii:
- Rates vary by locality
- Assessed annually
- May qualify for various exemptions based on business type
- Payments due August 20 and February 20, 2025
Tax Calendar and Filing Tips
Key Deadlines for Hawaii LLCs
January:
- January 15: Final estimated tax payment for previous year
- January 20: Fourth quarter pass-through entity tax payment due
- January 31: Issue W-2s/1099s to employees/contractors
- January 31: Fourth quarter payroll tax payment due (state and federal)
April:
- April 15: Federal income and self-employment tax returns due
- April 15: First quarter estimated tax payment due
- April 20: Corporate income tax returns due
- April 20: First quarter pass-through entity tax payment due
- April 21: State personal income tax returns due
- April 30: First quarter payroll tax payment due (state and federal)
June:
- June 16: Second quarter estimated tax due
- June 20: Second quarter pass-through entity tax payment due
July:
- July 31: Second quarter payroll tax payment due (state and federal)
September:
- September 15: Third quarter estimated tax payment due
- September 20: Third quarter pass-through entity tax payment due
October:
- October 31: Third quarter payroll tax payment due (state and federal)
Record-Keeping Checklist
Keep these records for at least 7 years:
- Business income records (invoices, receipts)
- Expense receipts and documentation
- Bank and credit card statements
- Asset purchase and improvement records
- Vehicle mileage logs
- Home office documentation
- Payroll records
- Previous tax returns
Tax Strategies for Hawaii LLCs
S Corporation Election Benefits
Converting your LLC to an S Corporation for tax purposes can save on self-employment taxes:
- File Form 2553 with the IRS
- Pay yourself a “reasonable salary” subject to employment taxes
- Take remaining profits as distributions exempt from self-employment tax
Example: An LLC making $100,000 in profit pays 15.3% self-employment tax on the entire amount. As an S Corp, if $60,000 is a reasonable salary and $40,000 is taken as distributions, only the $60,000 is subject to employment taxes.
Potential Savings: In this example, you’d save about $6,120 in self-employment taxes.
Business Expense Deductions
Common deductions Hawaii LLC owners often overlook:
- Home office deduction
- Business mileage (70¢ per mile for 2025)
- Health insurance premiums
- Retirement plan contributions
- Professional development expenses
- Business meals (50% deductible)
Forms and Resources
Federal Tax Forms
- Schedule C: Profit or Loss From Business (sole proprietors)
- Form 1065: U.S. Return of Partnership Income
- Schedule K-1: Partner’s Share of Income, Deductions, Credits
- Form 1120-S: U.S. Income Tax Return for an S Corporation
- Form 2553: Election by a Small Business Corporation (S Corp)
- Form 8832: Entity Classification Election
Hawaii Tax Forms
- Form N-11SF: Hawaii Individual Income Tax Return
- Form N-30: Hawaii Corporate Income Tax Return
- Form G-45: Hawaii State General Excise Tax Return (Periodic)
- Form G-49: Hawaii State General Excise Tax Return (Annual)
Helpful Resources
- Hawaii Department of Taxation
- Hawaii Business Express
- Internal Revenue Service
- State of Hawaii Unemployment Insurance
Hawaii LLC Taxes FAQs
Like in the rest of the US, LLCs based in Hawaii are typically taxed as pass-through entities, meaning their profits are taxed on the individual members’ tax returns. However, if LLCs choose to be taxed as C corps, they’ll pay corporation tax on their net income instead.
To find out more about this topic, see our LLC Taxes article.
Hawaii is favorable for forming an LLC due to its stable economic environment, clear regulatory framework, and business-friendly policies. However, it’s worth noting the cost of doing business and higher taxes when compared to some other states.
If you’re interested in finding out more about how to launch an LLC in this state, see our Hawaii LLC formation article.
Forming an LLC in Hawaii can cost as little as $50, which is enough to cover the Articles of Organization filing fees. However, the total cost may be higher for your business if it requires a specific state license or you choose to hire a professional service to file the Hawaii LLC Articles of Organization for you or draft your Hawaii LLC operating agreement.
Businesses in this state pay several taxes, including the Hawaii General Excise Tax (GET) ranging from 0.15% to 4%, depending on the business type. Other common taxes include income taxes, employer taxes, business privilege taxes, and county-specific taxes like property tax and transient accommodations tax.
Need Professional Help? While this guide covers the essentials, tax laws are complex and constantly changing. Schedule a free consultation with 1-800Accountant to ensure your Hawaii LLC remains fully compliant while minimizing your tax burden.