Video Transcript
Are you selling a property that has a capital gain, are a nonresident and in the state of Hawaii? If so, you may be subject to HARPTA. HARPTA stands for the Hawaii Real Estate Tax Act, and it’s a way for the state to ensure they get paid when you sell a property.
Nonresident sellers can expect that 7.25% of the gross sales price will be withheld and remitted to the state within twenty days. That means if you’re selling a property for a million dollars, you can expect that $72,500 of that will be withheld.
The good news is, is if you’re planning on doing a 1031 Exchange, you can completely avoid the withholding. So that’s great news. However, keep in mind, a 1031 Exchange can be a complicated transaction, and we definitely recommend reaching out to your tax advisor prior to getting started.
Understanding the Hawaiian Islands 1031 Exchange Process
If you have any questions about the Hawaii 1031 Exchange process or any other 1031 Exchange topic, please visit our Hawaii IPX 1031 web page at www.ipx1031.com/hawaii. We’re happy to help.
Click to visit Hawaii 1031 Exchange page