Hawaii Payroll Instructions

Hawaii uses a 'step' table to calculate state income tax withholding rates (similar to the federal withholding tax tables). Payroll withholding tax formulas did not change for 2023 (they have changed 11 times in the past 33 years).

There is also an employee withholding for disability insurance (Hawaii is one of four states that have this additional withholding item).

HINT: TurtleSoft provides free annual updates for US federal and Hawaiian tax withholding rates, for our payroll software users.

Hawaii State Withholding Instructions

To enter withholding information for an employee in your Goldenseal company file, follow these steps:

  1. Open the Payroll tab on the left, and choose Employees.
  2. Locate the employee's record.
  3. Click the Payroll Setup button.
  4. Enter the employee's marital status into the Marital Status field.
  5. Enter the number of federal dependents into the Federal Exemptions field.
  6. Enter the number of Hawaiian dependents into the State Exemptions field.
  7. Enter a Hawaii Tax Package into the Tax Package field, based on the employee’s W4 form. Choose Old W4 for pre-2020 forms. Choose New W4 Step2- if they did not check the box in step 2 of the new form. Choose Step2+ if they did check it. HINT: If you don't see Hawaii packages in the list, you'll need to import the tax info first.
  8. Click OK.

Hawaii State Unemployment Tax Instructions

In 2023, the Hawaii SUTA tax (unemployment insurance) applies to the first $55,800 in wages for each employee (increased from last year). The current starting rate for a new company is 3.0%. After the first year it varies from 0% up to a maximum rate of 5.4%, depending on the company's past experience rating.

To enter your Hawaiian state SUTA tax rate into Goldenseal payroll software, follow these steps:

  1. Choose Payroll Setup from the Costs menu, and choose Tax Items.
  2. You'll see a list of Tax Items. Open the Hawaii SUTA item HINT: If you don't see the state SUTA in the list, you'll need to import Hawaiian payroll info first.
  3. Enter the percentage rate that you pay into the percentage field to the right of Calculation method.
  4. If the cutoff amount has changed, enter it into the dollar field to the right of First Adjustment.

Hawaii Employment & Training Tax

Hawaii also has a .01% Employment and Training Tax (E&T).

Hawaii Disability Insurance

Employers are required to provide Temporary Disability insurance (TDI) for all employees (with a few exceptions). You may deduct .5% from employees to help cover this cost, but only on the first $1,119.44 of wages.

Hawaii Marital Status

Use the following to determine the value for the Marital Status popup menu in each Employee account:

State Tax Contacts

Website

Little-Known Hawaiian Tax Fact

Residents of the big island of Hawaii are required to burn their primary automobile as a sacrifice to Pele, whenever lava threatens to overrun their town or village. The cost is deductible.

Official State Lawn Ornament

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