HAR § 18-235-23-01 — Taxable in another state; in general

(a) Under section 235-22, HRS, the taxpayer is subject to the allocation and apportionment provisions of sections 235-21 to 235-29, HRS, if it has income from business activity that is taxable both within and without this State. A taxpayer’s income from business activity is taxable without this State if the taxpayer, by reason of that business activity (i.e., the transactions and activity occurring in the regular course of a particular trade or business), is taxable in another state within the meaning of section 235-23, HRS. (b) A taxpayer is taxable in another state if it meets either one of two tests: (1) If by reason of business activity in another state, the taxpayer is subject to a net income tax, a franchise tax measured by net income, a franchise tax for the privilege of doing business, or a corporate stock tax; or (2) If by reason of that business activity, another state has jurisdiction to subject the taxpayer to a net income tax, whether or not the state imposes such a tax on the taxpayer. (c) A taxpayer is not taxable in another state with respect to a particular trade or business merely because the taxpayer conducts activities in that other state pertaining to the production of nonbusiness income or business activities relating to a separate trade or business.