HAR § 18-235-110.7-13 — Recapture of credit under section 235-110

7, HRS. (a) In general. Subject to exceptions as discussed in section 18-235-110.7-16, a recapture rule applies to recompute previously taken credit if eligible property is disposed of or otherwise ceases to be eligible property within the recapture period. The recapture rule is limited to the statements in sections 18-235-110.7-01 to 18-235-110.7-22. See section 18-235-110.7-15 for a discussion of when property ceases to be eligible property. (b) “Recapture period”, defined. The term recapture period means the period beginning on the first day of the month the eligible property is placed in service, and extending for a full three years. (c) Recomputation. The credit is recomputed by multiplying the previously taken credit by a recapture percentage, and there should be taken into account any prior recapture determination in connection with the same property. (d) Recaptured amount treated as increase in income tax. An increase in income tax as a result of credit recapture shall be treated as income tax imposed on the taxpayer by chapter 235, HRS, for the recapture year. This is the rule notwithstanding that absent the recapture event, the taxpayer has no income tax liability, has a net operating loss, or no income tax return is otherwise required for the taxable year.