# Hawaii SB 2881: RELATING TO STATE INCOME TAX.

Hawaii SB 2881, RELATING TO STATE INCOME TAX., is a 2025–2026 Regular Session (Year 2) Senate bill sponsored by Donna Mercado Kim (Democratic); status signed, last action 2026-06-08 (Act 118, 06/08/2026 (Gov. Msg. No. 1218).); PRIA reads it as touching household money (as of 2026-11-01).

- Canonical: https://policyrisk.com/state-bill/HI-SB2881-2026
- As of: 2026-11-01
- Plain-text twin of the page above; the HTML and this file carry the same facts.

## Facts
- Bill: Hawaii SB 2881
- State: Hawaii
- Session: 2025–2026 Regular Session (Year 2)
- Title: RELATING TO STATE INCOME TAX.
- Status: signed
- Chamber: Senate
- Introduced: 2026-01-23
- Last action: 2026-06-08, Act 118, 06/08/2026 (Gov. Msg. No. 1218).
- Sponsor: Donna Mercado Kim (Democratic)
- Cosponsors: 3
- Subjects: DOTAX, Form 1099-R, Distributions, Income Tax, Voluntary Withholding, Rules, FIN
- Touches household money: yes
- Roll calls: 8 (211 yes, 0 no in all)
- Economic provisions PRIA read: 1

## Summary

Provides that taxable income subject to reporting as distribution on Internal Revenue Service Form 1099-R may be subject to withholding at the taxpayer's election. Requires the Department of Taxation to adopt rules and prescribe forms. Applicable to taxable years beginning after 12/31/2026. Effective 7/1/3000. (HD1)

## Bill overview: provisions PRIA read

- Retirees can choose Hawaii tax withholding: mixed, low. For taxable years beginning after December 31, 2026, you can ask in writing to have Hawaii tax withheld from a taxable distribution reported on Form 1099-R. The payer must withhold the amount you designate and send it to Hawaii’s Department of Taxation. The amount counts toward your Hawaii income t…

## Sponsors and cosponsors

- Sponsor: Donna Mercado Kim (Democratic), Senate
- Cosponsor: Stanley Chang (Democratic), Senate
- Cosponsor: Rachele Lamosao (Democratic), Senate
- Cosponsor: Angus L.K. McKelvey (Democratic), Senate

## Roll call votes

| Date | Chamber | Motion | Result | Yes | No | Other |
| --- | --- | --- | --- | --- | --- | --- |
| 2026-05-06 | House | House Floor Vote | pass | 51 | 0 |   |
| 2026-04-30 | House | The Conference Committee recommends that the measure be Passed, with Amendments.... | pass | 3 | 0 |   |
| 2026-04-30 | Senate | The Conference committee recommends that the measure be PASSED, WITH AMENDMENTS.... | pass | 3 | 0 |   |
| 2026-04-14 | House | House Floor Vote | pass | 51 | 0 |   |
| 2026-04-09 | House | House Floor Vote | pass | 49 | 0 |   |
| 2026-04-07 | House | The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS. The ... | pass | 16 | 0 |   |
| 2026-03-10 | Senate | Senate Floor Vote | pass | 25 | 0 |   |
| 2026-03-02 | Senate | The committee(s) on WAM recommend(s) that the measure be PASSED, WITH AMENDMENT... | pass | 13 | 0 |   |

## Actions (38)

- 2026-06-08: Act 118, 06/08/2026 (Gov. Msg. No. 1218). (Senate)
- 2026-06-08: Act 118, on 06/08/2026 (Gov. Msg. No. 1218). (House)
- 2026-05-08: Received notice of passage on Final Reading in House (Hse. Com. No. 888). (Senate)
- 2026-05-08: Enrolled to Governor. (Senate)
- 2026-05-06: Passed Final Reading, as amended (CD 1). Ayes, 25; Aye(s) with reservations: none . 0 No(es): none. 0 Excused: none. (Senate)
- 2026-05-06: Passed Final Reading as amended in CD 1 with none voting aye with reservations; none voting no (0) and none excused (0). (House)
- 2026-05-06: Received notice of Final Reading (Sen. Com. No. 816). (House)
- 2026-05-01: Reported from Conference Committee as amended CD 1 (Conf. Com. Rep. No. 109-26). (Senate)
- 2026-05-01: 48 Hrs. Notice (as amended CD 1) 05-06-26. (Senate)
- 2026-05-01: Reported from Conference Committee (Conf Com. Rep. No. 109-26) as amended in (CD 1). (House)
- 2026-05-01: Forty-eight (48) hours notice Wednesday, 05-06-26. (House)
- 2026-04-30: The Conference committee recommends that the measure be PASSED, WITH AMENDMENTS. The votes of the Senate Conference Managers were as follows: 3 Aye(s): Senator(s) Kim, Moriwaki, Fevella; Aye(s) with reservations: none ; 0 No(es): none; and 0 Excused: none. (Senate)
- 2026-04-30: The Conference Committee recommends that the measure be Passed, with Amendments. The votes were as follows: 3 Ayes: Representative(s) Takenouchi, Kitagawa, Gedeon; Ayes with reservations: none; 0 Noes: none; and 0 Excused: none. (House)
- 2026-04-29: Conference committee meeting scheduled for 04-30-26 11:00AM; Conference Room 309. (Senate)
- 2026-04-21: Senate Conferees Appointed: Kim Chair; Moriwaki, Fevella. (Senate)
- 2026-04-21: Received notice of Senate conferees (Sen. Com. No. 718). (House)
- 2026-04-20: House Conferees Appointed: Takenouchi Chair; Kitagawa, Gedeon. (House)
- 2026-04-20: Received notice of appointment of House conferees (Hse. Com. No. 787). (Senate)
- 2026-04-16: Received from House (Hse. Com. No. 712). (Senate)
- 2026-04-16: Senate disagrees with House amendments. (Senate)
- 2026-04-16: Received notice of disagreement (Sen. Com. No. 710). (House)
- 2026-04-14: Passed Third Reading with none voting aye with reservations; none voting no (0) and none excused (0). Transmitted to Senate. (House)
- 2026-04-09: Reported from FIN (Stand. Com. Rep. No. 1984-26) as amended in HD 1, recommending passage on Second Reading and placement on the calendar for Third Reading. (House)
- 2026-04-09: Passed Second Reading as amended in HD 1; placed on the calendar for Third Reading with none voting aye with reservations; none voting no (0) and Representative(s) Cochran excused (1). (House)
- 2026-04-07: The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 16 Ayes: Representative(s) Todd, Takenouchi, Hartsfield, Hussey, Keohokapu-Lee Loy, Kitagawa, Kusch, Lee, M., Miyake, Morikawa, Perruso, Templo, Yamashita, Alcos, Gedeon, Reyes Oda; Ayes with reservations: none; 0 Noes: none; and 0 Excused: none. (House)
- 2026-04-02: Bill scheduled to be heard by FIN on Tuesday, 04-07-26 2:00PM in House conference room 308 VIA VIDEOCONFERENCE. (House)
- 2026-03-12: Pass First Reading (House)
- 2026-03-12: Referred to FIN, referral sheet 17 (House)
- 2026-03-10: Passed Third Reading, as amended (SD 1). Ayes, 25; Aye(s) with reservations: none . Noes, 0 (none). Excused, 0 (none). Transmitted to House. (Senate)
- 2026-03-10: Received from Senate (Sen. Com. No. 313) in amended form (SD 1). (House)
- 2026-03-05: Reported from WAM (Stand. Com. Rep. No. 2876) with recommendation of passage on Second Reading, as amended (SD 1) and placement on the calendar for Third Reading. (Senate)
- 2026-03-05: Report adopted; Passed Second Reading, as amended (SD 1). (Senate)
- 2026-03-05: 48 Hrs. Notice 3/10/2026. (Senate)
- 2026-03-02: The committee(s) on WAM recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in WAM were as follows: 13 Aye(s): Senator(s) Dela Cruz, Moriwaki, DeCoite, Elefante, Hashimoto, Inouye, Kanuha, Kidani, Kim, Lee, C., Wakai, Fevella; Aye(s) with reservations: Senator(s) Richards ; 0 No(es): none; and 0 Excused: none. (Senate)
- 2026-02-27: The committee(s) on WAM has scheduled a public hearing on 03-02-26 10:00AM; Conference Room 211 & Videoconference. (Senate)
- 2026-01-30: Referred to WAM. (Senate)
- 2026-01-26: Passed First Reading. (Senate)
- 2026-01-23: Introduced. (Senate)

## Bill text

- Bill Text: [PDF](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_CD1_.pdf)
- Original: [HTML](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_.HTM), [PDF](https://data.capitol.hawaii.gov/sessions/session2026/bills/GM1218_.PDF)
- SB2881_CD1: [HTML](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_CD1_.HTM)
- SB2881_HD1: [HTML](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_HD1_.HTM)
- SB2881_SD1: [HTML](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_SD1_.HTM)

## Related bills

- SB 847: RELATING TO PSYCHOLOGISTS. (became law)
- SB 2338: RELATING TO HOUSING. (signed)
- HB 2344: RELATING TO SCHOOL FACILITIES. (signed)
- HB 2023: RELATING TO TRANSPORTATION. (signed)
- HB 2021: RELATING TO TRANSPORTATION. (signed)
- SB 2866: RELATING TO KUPUNA HOUSING. (signed)

## Sources
- [Bill Text (PDF)](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_CD1_.pdf)
- [Original (HTML)](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_.HTM)
- [Original (PDF)](https://data.capitol.hawaii.gov/sessions/session2026/bills/GM1218_.PDF)
- [SB2881_CD1 (HTML)](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_CD1_.HTM)
- [SB2881_HD1 (HTML)](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_HD1_.HTM)
- [SB2881_SD1 (HTML)](https://data.capitol.hawaii.gov/sessions/session2026/bills/SB2881_SD1_.HTM)

## Related
- [SB 847: RELATING TO PSYCHOLOGISTS.](https://policyrisk.com/state-bill/HI-SB847-2026)
- [SB 2338: RELATING TO HOUSING.](https://policyrisk.com/state-bill/HI-SB2338-2026)
- [HB 2344: RELATING TO SCHOOL FACILITIES.](https://policyrisk.com/state-bill/HI-HB2344-2026)
- [HB 2023: RELATING TO TRANSPORTATION.](https://policyrisk.com/state-bill/HI-HB2023-2026)
- [HB 2021: RELATING TO TRANSPORTATION.](https://policyrisk.com/state-bill/HI-HB2021-2026)
- [SB 2866: RELATING TO KUPUNA HOUSING.](https://policyrisk.com/state-bill/HI-SB2866-2026)
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- [Hawaii state hub](https://policyrisk.com/states/hawaii)
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Source: PRIA, https://policyrisk.com/state-bill/HI-SB2881-2026 (as of 2026-11-01).