Information and Options to Resolve Your State Tax Debt
Can’t pay your taxes?
We can help! DOTAX is committed to work with you to address your tax issues. Not filing your taxes can lead to serious consequences such as audits, garnishments, bank levies etc.
If you cannot pay-off your tax debt, please file your return(s) by the deadline and pay as much as possible. Once you receive a bill, you may apply for either a Payment Plan or an Offer in Compromise.
Payment Plan
A Payment Plan is payment in monthly installments towards your debt.
How do I apply?
- Logon to your Hawaii Tax Online account at https://hitax.hawaii.gov to set up a payment plan.
Offer in Compromise
An Offer in Compromise (OIC) is a written agreement with the State to settle unpaid tax debt for less than the total amount due.
There are five basic requirements.
- You are unable to generate future income due to retirement or health issues (a long-term disability or a certified permanent medical condition).
- The value of your total assets (real property, cash, investments etc.) are less than the tax debt.
- You have no significant passive income streams (i.e. rental, investment, business income) to pay-off your debt.
- You have filed the required tax returns through the current period.
- You have not previously received tax relief such as a tax liability discharged through bankruptcy, written off past statute, an innocent spouse relief or any prior settlement.
Meeting these requirements does not guarantee an approval. All applications require documentation which will be reviewed and verified.
Complete and send the following:
- Form CM-1 Offer in Compromise on website at Hawaii Tax Forms (Alphabetical Listing)
- Form CM-2 (Individual) or CM-2B (Corporation) Statement of Financial Condition (Federal Forms are acceptable) on website at Hawaii Tax Forms (Alphabetical Listing)
- Copies of all bank statements & bank checks/check register for last 3 months
If applicable, also provide:
- ___ Copies of statements showing the premium amounts for all insurance (auto, home, health, renters, etc.) – the coverage page of the homeowners & renters insurance policies and the first page of all insurance policies
- ___ Copies of Federal income tax returns for the last 3 tax years
- ___ Copies of any and all contracts and notes receivables
- ___ Copies of any and all judgments, including divorces
- ___ Real property: Complete name and address of encumbrance/lien holder & proof of remaining balance. Copies of any and all deeds to real property in which you have an interest. Realtor’s valuation, and a copy of the current year’s county assessor’s valuation. If renting, provide a copy of your rent/lease agreement.
- ___ Vehicles: Copies of all registration certificate(s) issued by the Department of Licensing, verification of any encumbrances against all vehicles plus the current statements. Provide verification of how the values were determined, this includes cars, boats, trucks, motor homes airplanes, etc.)
- ___ Copies of any and all pre or ante nuptial agreement, with affidavits from each of the parties under penalty of perjury regarding adherence to said agreements
- ___ Copies of any and all trusts of which you may be a beneficiary or which you have an interest
- ___ Copies of paychecks/stubs/statements for the last 6 months
- ___ Proof of all court ordered payments you are making (child/spousal support, fines, etc.)
- ___ Proof of monthly expenses not already covered, i.e. utility bills, transportation, etc.
- ___ Doctor’s papers, if claiming ill health or disabled
- ___ The Source of funds for offer
- ___ Copy of Federal Offer in Compromise and letter of acceptance
How do I apply?
For faster processing, send your pdf documents via web message on Hawaii Tax Online (HTO).
To set-up an account on HTO, visit Hawaii Tax Online at https://hitax.hawaii.gov, or send all applicable forms and documents to:
By mail:
Department of Taxation – Collections Branch
P.O. Box 259
Honolulu, HI 96809-0259
By Fax:
(808) 587-1720
For more information, TAX FACTS 2000-2 Offer in Compromise.
Related:
- Taxpayer Advocate
- Taxpayer Advocate, FAQs
- Information and Options to Resolve Your State Tax Debt
- Hawaii Taxpayers Bill of Rights (PDF) 2 pages, 405 KB, Revised July 2022
- Tax Collection Service