(a) The director of taxation may grant a
reasonable extension of time for filing any return, declaration, statement, or
other document required under chapter 235, HRS; provided that no extension
shall be for more than six months, except as otherwise provided by statute for
cases in which exceptional circumstances require additional time, including
cases of persons who are outside the United States.
(b) Any taxpayer required to file an income
tax return, declaration, statement, or other document under chapter 235, HRS,
is granted an automatic six-month extension to file the tax return after the
date prescribed for filing. The taxpayer need not file an application form to
request an extension. However, if the taxpayer makes a payment of tax, the
payment shall be submitted with the form prescribed by the department.
Automatic extensions shall be granted subject to the following conditions:
(1) On or before the due date prescribed by
the statute for the filing of a return, there shall have been paid, through
refundable credits, nonrefundable credits, withholding of taxes, estimated tax
payments, or a payment submitted with a form prescribed by the department, an
amount equal to the properly estimated tax liability for the taxable
year;
(2) The tax return shall be
filed within the time granted by the automatic extension and shall be
accompanied by payment of tax shown as due on the return to the extent not
already paid; and
(3) A court has
not ordered the taxpayer to file the tax return, declaration, statement, or
other document to be extended on or before the prescribed due date.
The failure to file a tax return penalty under section
231-39(b)(l),
HRS, shall not be imposed on any return filed on or before the extended due
date if these conditions are met. However, if the stated conditions are not
met, the automatic extension shall be deemed invalid and penalties and interest
shall be assessed on the amount of tax owed as if no automatic extension had
been granted (i.e., the computation of penalties under section
231-39(b)
(1), HRS, and interest under section
231-39(b)(4),
HRS, shall relate back to the due date prescribed by the statute).
(c) The director of
taxation may terminate the automatic extension at any time by mailing a notice
of termination to the taxpayer. The notice shall be mailed at least ten days
prior to the termination date designated in the notice.
(d) For purposes of this section, "properly
estimated tax liability" means the amount that the taxpayer estimates the tax
liability will be for the taxable year, based on a bona fide and reasonable
attempt as of the due date prescribed for the filing of the return to locate
and account for all of the information necessary to make the estimate. Payment
of properly estimated tax liability will be presumed if the tax still owing
after the due date prescribed for the filing of the return, determined without
regard to any extension, is ten per cent or less of the tax liability stated on
the return. For purposes of this subsection, "tax liability stated on the
return" means the amount of tax due before taking into account credits and
payments.
(e) Any extension to file
an income tax return under section
235-98,
HRS, shall not extend the time for payment of any tax due on the return, but
shall only extend the time to file the return. Interest under section
231-39(b)
(4), HRS, shall be assessed on any amount of
tax that is not paid on or before the prescribed due date.
