HAR § 18-235-110.7-06 — Used section 38 property

(a) For calendar year 1988 (and fiscal year taxpayer acquisitions occurring during the period beginning January 1, 1988, to December 31, 1988). Property qualifies as used section 38 property if: (1) The property is section 38 property (as defined in section 18-235-110.7-04); (2) The property is not new section 38 property (as defined in section 18-235-110.7-05); and (3) The property is not used by the same person (i.e., taxpayer or a related person as defined in I.R.C. §179(d)(2)(A) or (B)) both before and after the purchase. (A) Use by prior user. Property shall not be treated as used section 38 property if the property is used by the same person (i.e., taxpayer or a related person) both before and after its purchase. (B) Substantial use. While used section 38 property must not be used by the same person both before and after its purchase, only substantial use before a purchase disqualifies used property for purposes of the credit. Casual use before a purchase would not disqualify used property from eligibility for the credit. (C) Example. Subparagraph (B) is illustrated as follows: HRS §235-110.7 HRS §235-110.7