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kpperkins
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CA resident. Received a final K-1 & N20 for Hawaii property sold & partnership now dissolved. If I file a Hawaii return, can I get refund of income tax withheld on N-288?

 
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CA resident. Received a final K-1 & N20 for Hawaii property sold & partnership now dissolved. If I file a Hawaii return, can I get refund of income tax withheld on N-288?

Possibly.  Many states have nonresident withholding or composite return filing requirements.  The tax withholding is generally based on a set tax rate.  Nonresidents can certainly obtain a refund, however, this requires the filing of a nonresident state tax return.  When completing this form you will be required to complete a schedule that reflects income within and outside the state.  If once completed and you are due a refund, then the state will send it your way.  

Many individuals just opt not to file as the time and effort is not worth determining if there is actually a refund due.  Keep in mind that just because there were state withholding, this does not automatically release these individuals from their tax filing requirements.  However, in most cases the withholding is sufficient and the state may not follow-up with the nonresidents.

The withholding is different than a composite tax return.  Here the entity has made a decision on behalf of the partners to file a composite return and pay the tax.  Nonresident partners included on a composite tax return have no further filing requirement with that state; unless of course they have other income from that state.

Attached is the nonresident return for Hawaii:

http://files.hawaii.gov/tax/forms/2016/n15_b.pdf

*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.

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CA resident. Received a final K-1 & N20 for Hawaii property sold & partnership now dissolved. If I file a Hawaii return, can I get refund of income tax withheld on N-288?

Possibly.  Many states have nonresident withholding or composite return filing requirements.  The tax withholding is generally based on a set tax rate.  Nonresidents can certainly obtain a refund, however, this requires the filing of a nonresident state tax return.  When completing this form you will be required to complete a schedule that reflects income within and outside the state.  If once completed and you are due a refund, then the state will send it your way.  

Many individuals just opt not to file as the time and effort is not worth determining if there is actually a refund due.  Keep in mind that just because there were state withholding, this does not automatically release these individuals from their tax filing requirements.  However, in most cases the withholding is sufficient and the state may not follow-up with the nonresidents.

The withholding is different than a composite tax return.  Here the entity has made a decision on behalf of the partners to file a composite return and pay the tax.  Nonresident partners included on a composite tax return have no further filing requirement with that state; unless of course they have other income from that state.

Attached is the nonresident return for Hawaii:

http://files.hawaii.gov/tax/forms/2016/n15_b.pdf

*A reminder that posts in a forum such as this do not constitute tax advice.
Also keep in mind the date of replies, as tax law changes.

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