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After graduating from high school in Hawaii, I attended university

in Oregon and lived there...
After graduating from high school in Hawaii, I attended university in Oregon and lived there for about 7 years. from time to time I returned to Hawaii during the summer vacations and worked part time. After graduating, I moved to Japan to work for the Ministry of Education and have worked here for 17 years (currently living and working in Japan). During that time I filed my federal IRS tax forms (with Japanese W-2s and foreign income exclusion form 2555 ez) and am currently up to date on that. However, I have NEVER filed a state income tax form. I have a Hawaii drivers license and have two bank accounts there (mainly for exchange rate yen-dollar purposes), I also have family currently residing there. In Japan, I also have a Japanese driver's license, bank accounts, rent property and have several credit card accounts. I plan to apply for permanent residence this year. In addition, I do plan to purchase (as investment) property in Hawaii perhaps this year. Can the Hawaii tax authorities get me for back taxes even though I am NOT a registered voter in any state or have never lived in Hawaii for the past 17 years and don't plan to live there in the future??
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5/13/2013
Megan C
Megan C, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 16,581
Experience: Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level
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Thank you for your question, and thanks for using JustAnswer.com.

 

As you did not live in Hawaii, you are not considered a resident of Hawaii. You are no longer considered a resident once you do not live within the state.


Please let me know if you need any additional assistance. Thanks again for using JustAnswer.com and have a great day.

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Customer reply replied 4 years ago

do you need any other information?

Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 12,885
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

HI,

Please don't shoot the messenger here, but as you did live and work in Hawaii, they COULD come after you for any taxes owed from the part time work that you did there ... they would call that "Hawaii Source Income."



Since you DID say that you only worked there part time, you should know the following:

The personal exemption amount is $1040 per person and The personal exemption amount is $1040 per exemption and the standard deduction amount for Single or Married filing separately $2000,

So you would have to make more than $3,040 in a year in Hawaii, to even owe any taxes, so IT MAY make sense to file, just to put it behind you.



Also, it could very be (POSSIBLY) that the amount owed, since you don't live there now, would be what they would call a Di minimus amount (more costly to collect than would be gained from the tax revenue itself) ... if you don't live there, even if they go a judgment, they will have to acquire representation in whatever jurisdiction you currently live and go through the filings needed there, to enforce a judgment.



And finally, if you do plan to have rental property there in the future, THAT may be where they put you back on the radar screen, as rental income over a certain amount (if generated in Hawaii) will be taxable in Hawaii.




Hope this helps

Lane

If this HAS helped, I would appreciate a feedback rating of 3 (OK) or better. That's the only way they will pay us here.

HOWEVER, if you need more on this, PLEASE COME BACK here, so you won't be charged for another question
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As a follow-up ... I just found this ...



In the event that it does make sense to file given that the amounts may be below those thresh holds mentioned above....

If you need forms for a prior year, you can call Hawaii's Forms Request Line at(NNN) NNN-NNNNor toll-free at 1-800-222-7572 if they are not available on the website.



Let me know if this helps, OR if you want to provide more specificity, so that we can drill down further on this.

Lane

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Original expert here. Apologies, but our site has been having technical difficulties

According to chapter 235 of the Hawaii Income Tax Law, you owe tax to Hawaii if you are a resident. Once you moved to Japan, you were no longer considered a resident of Hawaii as you were no longer domiciled there. You would only owe tax for the period you lived there.

You will NOT owe back taxes for the 17 years you lived in Japan - you were not considered a Hawaii resident then. A bank account would not make you a resident, so do not worry about having a bank account there.

So, do not worry about the 17 year period you have been domiciled in Japan, unless you had Hawaii sourced income at that time.

 

According to the tax law, you are domiciled in Hawaii when:

 

Establishing residency by domicile.
(a) An individual who is domiciled in Hawaii
is considered a resident.
(1) Domicile is the place of the individual's true, fixed, permanent home.
(2) The domicile is the principal establishment to which the individual has the intention of returning
whenever the individual is absent.
(3) An individual can have several residences or dwelling places in which he or she resides, but can
have only one domicile, or permanent residence to which he or she intends to return.
(b) An individual's domicile may change where there is a concurrence of:
(1) An abandonment of the old domicile with a specific intent to abandon the old domicile;
(2) An intent to acquire a specific new domicile; and
(3) An actual physical presence in the new domicile.
(c) The burden of proof as to a change of domicile is upon the individual asserting that a change in
domicile has taken place. The individual must establish a change of domicile by clear and convincing evidence.
(d) An individual can acquire a domicile by birth, choice, or operation of law, as set forth in sections
18-235-1-04, 18-235-1-05, and 18-235-1-06, HAR, respectively. [Eff 2/16/82; am 9/3/94; am and ren §18-235-1.03

8/28/98](Auth: HRS §§231-3(9), 235-118) (Imp: HRS §235-1

Please let me know if you have further questions.

You can review the tax document I referenced, HERE.

Please take a moment to rate my response "Excellent" so that I may receive credit for assisting you today.

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Yes, "intervening expert here."

The site has certainly been "buggy" for us today.

Normally, we would not both be able to address the same question.

Between the two of us, however, you certainly have a thorough answer.

Please DO rate MyVirtualCPA's answer as excellent, so that she can be paid for her time.
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Customer reply replied 4 years ago


OK, I am NOT considered a resident if I have bank accounts there.


 


But what about the fact that I have had a Hawaii Driver's license for the whole time that I was in Japan (in addition to my Japanese driver's license of course)?


 


In addition, would the fact that I have family there and every now and then use an address of a family member in Hawaii to apply for certain credit cards or to run a credit check (since all these transactions require a U.S. address) have influence on determining residencey or non-residency?

Thank you for your follow up. Having a Hawaii driver's license does not make you a resident of Hawaii. It is one of the factors that is considered when looking at whether or not someone is a resident of the state, but in and of itself it does not indicate residency. As for visiting your relatives, that is being in Hawaii for a "transitory" purpose.

You can prove, without a shadow of doubt, that you were a resident of Japan. You will not owe tax in Hawaii on income you earned in Japan when you were a resident there. You will, however, owe Hawaii tax on any Hawaii sourced income or income earned while a resident there. However, for the 17 year period where you were gone from Hawaii you will not owe tax.

You can read about this on pages 235-6 through 235-8 of the link that I sent you in my previous post. The facts and cirucumstances will indicate your residency or non-residency.

However, once you have a rental in Hawaii you will owe tax on that source of income. But - as a non-resident you are only taxed on the Hawaii source income.

Please let me know if you need anything additional. Please take a moment to rate my response as "excellent" so that I may receive credit for assisting you today. Thanks again for using JustAnswer.com
Megan C
Megan C, Certified Public Accountant (CPA)
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