Here’s what Hawaii rental owners need to know about HARPTA and FIRPTA.
Have you heard of HARPTA and FIRPTA? These are important taxes for Hawaii rental owners to know about, so let’s talk about them.
First, what is HARPTA? Standing for the “Hawaii Real Property Tax Act,” this act withholds tax on sales of Hawaii rental properties by non-resident owners. We exclusively work with rental properties, so we always remind our clients about this tax. We aren’t tax experts or CPAs, so talk with a tax professional when dealing with HARPTA.
FIRPTA, on the other hand, stands for “Foreign Investments in Rental Properties Tax Act.” Combined with HARPTA, these laws are huge because they take a percentage of your sales price instead of your profits.
We highly recommend you speak with your Realtor and tax experts about these taxes. If you need a professional referral, just reach out to 808-445-9223 or info@HIPacificPM.com. We look forward to hearing from you!