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INSTRUCTIONS STATE OF HAWAII—DEPARTMENT OF TAXATION
FORM N-342C
(REV. 2017) INSTRUCTIONS FOR FORM N-342C
COMPOSITE INFORMATION STATEMENT FOR FORM N-342
(FOR 10 OR MORE SYSTEMS INSTALLED AND PLACED IN SERVICE BY AN ENTITY IN A SINGLE TAXABLE YEAR)
GENERAL INSTRUCTIONS Print the word “COMPOSITE” in capital letters at the top of Form N-342
(Note: Failing to properly file and/or comply with the terms and conditions to designate it as a composite form. Add the amounts reported in the
for composite filing may result in the disallowance of all or part the columns for each line in Part I of Form N-342C, and report the total on the
tax credits and the revocation of the election to composite file.) applicable line of the composite Form N-342. For example, if the amount
in each column on line 1 of Form N-342C is $10,000 and there are 10
Each individual or corporate taxpayer may claim a renewable energy systems (i.e., 10 columns), then enter $100,000 ($10,000 x 10) on line 1 of
technologies income tax credit (RETITC) for each renewable energy the composite Form N-342.
technology system (system) that is installed and placed in service in a
single taxable year as provided for under section 235-12.5, Hawaii Revised PURPOSE OF FORM N-342C
Statutes (HRS). Form N-342C is used to calculate the tax credit for each system. Form
In the case of a partnership, S corporation, estate, trust, or condominium N-342C is a detailed schedule of the information reported on a composite
apartment association (entity), the cost upon which the tax credit is Form N-342.
computed shall be determined at the entity level. For taxable years that PURPOSE OF A COMPOSITE FORM N-342A
begin on or after January 1, 2011, an entity that has installed and placed in A composite Form N-342A is prepared by the entity and used to report
service 10 or more systems in a single taxable year may elect to composite a member’s total share of the tax credits. Use composite Form N-342A to
file Forms N-342 and N-342A pertaining to the RETITC. The requirements summarize and report the amounts from Form N-342B.
for composite filing are discussed in these instructions and in Department Print the word “COMPOSITE” in capital letters at the top of Form
of Taxation Announcement No. 2012-01. N-342A to designate it as a composite form. Add the amounts reported
FORMS REQUIRED TO BE FILED BY THE ENTITY in the columns for each line in Part I of Form N-342B, and report the total
Every entity that has installed and placed in service 10 or more on the applicable line of the composite Form N-342A. For example, if the
systems in a single taxable year and elects to composite file shall prepare amount in each column on line 1 of Form N-342B is $20,000 and there are
and attach to its Hawaii income tax return the following forms: 10 systems (i.e., 10 columns), then enter $200,000 ($20,000 x 10) on line
(1) Composite Form N-342; 1 of the composite Form N-342A.
(2) Form N-342C; PURPOSE OF FORM N-342B
(3) Composite Form(s) N-342A; Form N-342B is prepared by the entity to report a member’s distributive
(4) Form(s) N-342B share of the tax credit per system. Form N-342B is a detailed schedule of
Attach the forms listed above along with all other required forms, the information reported on a composite Form N-342A.
schedules, and attachments and submit the complete Hawaii income tax
return in the manner prescribed in the applicable Hawaii income tax return INFORMATION FOR MEMBERS
instructions. A composite Form N-342A and Form N-342B received from an
In addition, the entity must provide a composite Form N-342A and entity is used by the member to complete a composite Form N-342 and
Form N-342B to each partner, shareholder, member, and beneficiary Form N-342C so that the member may claim its share of the entity’s
(member), to report the member’s distributive share of the entity’s tax RETITC. See the “Forms Required to Be Filed by the Taxpayer Claiming
credits attributable to the installation and placing in service 10 or more the RETITC” section in these instructions for more information.
systems in a single taxable year. CREDIT ELECTIONS
FORMS REQUIRED TO BE FILED BY THE TAXPAYER CLAIMING THE A separate (refundable or nonrefundable) election must be made for
RETITC each system (or distributive share of a system) that generates a RETITC.
Every individual or corporate taxpayer who is eligible to claim the Once a refundable election is made, it is irrevocable. A taxpayer electing
RETITC for 10 or more systems/distributive shares of systems in a single both refundable and nonrefundable RETITC must file 2 separate sets
taxable year and elects to composite file shall prepare and attach to its of forms (one set for the refundable RETITC and another set for the
Hawaii income tax return the following forms: nonrefundable RETITC). Each set shall contain the forms listed in the
(1) Composite Form N-342; and “Forms Required to Be Filed by the Taxpayer Claiming the RETITC” section
(2) Form N-342C; of these instructions. (Note: Refundable tax credits must be computed
and attach the following forms provided by the entity: before nonrefundable tax credits.)
(3) Composite or separate Form(s) N-342A;
(4) Form(s) N-342B; and SPECIFIC INSTRUCTIONS
(5) Any other forms/schedules required to claim the credit. Each column on Form N-342C represents a separate system. Additional
Attach the forms listed above along with all other required forms, Forms N-342C may be used if there are more than 10 systems to report.
schedules, and attachments and submit the complete Hawaii income tax Step 1 — Enter the taxpayer’s name, social security number (SSN) or
return in the manner prescribed in the applicable Hawaii income tax return federal identification number (FEIN), and Hawaii tax identification number
instructions. in the designated spaces on the form.
The deadline to claim the credit, including amended claims, is 12 Property Number — Enter the property number that corresponds to
months after the close of your taxable year. You cannot claim or amend the physical property address listed in Part II where each system was installed
credit after the deadline. and placed in service.
In addition, the taxpayer must also submit a “soft” or electronic copy
of the composite Form(s) N-342 and Form(s) N-342 to the Department of Type of System — Enter the type (solar water, other solar, or wind) of
Taxation (Department) in one of the following ways: system that was installed and placed in service.
Date Installed & Placed in Service — Enter the date the system was
(1) E-mail to: Tax.Directors.Office@hawaii.gov installed and placed in service.
(2) Mail or hand-deliver to: Department of Taxation Total Output Capacity (if credit is for an “other solar energy system”)
Attention: Director’s Office — Enter the Total Output Capacity of the “other solar energy system” that
830 Punchbowl Street the credit is being claimed for”.
Honolulu, HI 96813 Part I, lines 1 through 54 — Fill in the applicable lines. Each line in Part
Forms that are mailed or hand-delivered must be submitted on a digital I represents a corresponding line on a composite Form N-342. Use Form
media storage source such as a CD-R or DVD-R. (Note: Digital media N-342 and its instructions to complete the applicable lines in Part I.
storage sources will not be returned by the Department.) Part II — Enter the physical address, city or town, and postal/ZIP code of the
real property where each system was installed and placed in service. In the
PURPOSE OF A COMPOSITE FORM N-342 Property Number column, number each physical property address so that
A composite Form N-342 is used to claim the total tax credits the number corresponds to property number listed for the systems in each
attributable to the installation and placing in service 10 or more systems. column in Part I. If additional space is needed, attach a continuation sheet.
Use composite Form N-342 to summarize and report the amounts from
Form N-342C.