Oahu Real Estate Insiders 🏡

What websites and forms can I use? City BFS Clearance for Real Property Taxes & OTAT Application (PDF): www.honolulu.gov/bfs/wp-content/uploads/sites/62/2025/04/bfs-taxclearanceform-rev203-18-25.pdf *City BFS Real Property Records (taxes) website: www.qpublic.net/hi/honolulu/search.html ***State DOTAX Clearance Application (PDF): https://files.hawaii.gov/tax/forms/2022/a6_i.pdf ****State DOTAX Tax Online website: https://hitax.hawaii.gov/_/ *****City BFS OTAT payments website: www.honolulu.gov/bfs/otat/

This newly completed Kakaako Condo may be something that you may be interested? let us know if you need help buying some units in there.

Today, a client asked us, "If I own a property on Oahu using an out-of-state company LLC, am I subject to out-of-state withholding tax"

The answer:Yes, you are subject to it. It is actually called HARPTA (Hawaii Real Property Tax Act), and an out-of-state LLC is considered a non-resident person under Hawaii tax law.

1. It is a Withholding, Not an Extra Tax

The most important nuance is that HARPTA is not a separate penalty tax for out-of-state owners. It is a backup withholding system designed to ensure that non-residents pay their state capital gains taxes before taking their money out of Hawaii.  

When you sell the property, the escrow company is required by law to withhold 7.25% of the total gross sales price (not your net profit) and send it directly to the Hawaii Department of Taxation.  

2. Why the LLC Structure Doesn't Bypass It