Forest ProductsTax Credit Sourcebook

Hawaii · research and development · HI-RD-001

Tax Credit for Research Activities

Publication revised September 24, 2026. Sourcebook page 91.

Credit amount / calculation

Credit tied to qualified research expenditures, subject to annual $5 million statewide cap and certification window.

Business fit and eligible activity

Qualified high-technology businesses conducting Hawaii research may receive a refundable credit; ordinary wood businesses may not meet the QHTB definition. Qualified research activity. Ordinary production, routine quality control and an equipment purchase alone do not qualify.

Eligibility and practical use

The high-technology-business qualification requires more than half of the business's activities to be qualified research. An ordinary production mill does not qualify merely because it conducts a small process-development project.

Illustrative business benefit

Use-of-credit illustration, not an estimated award: assume the agency or completed tax form establishes a $1,000 credit for the qualifying activity described above. With $600 of eligible tax due, a fully refundable $1,000 award would offset that tax and leave $400 refundable, subject to the program's refund procedure. Obtain the actual program calculation before estimating a project benefit.

Timing / first action

Check application or certification requirements before incurring the qualifying expense or beginning the qualifying activity.

Official sources

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