N-342: Renewable Energy Technologies Income Tax Credit for Systems Placed in Service on or after July 1, 2009 (2025)

Who files this form

Use Form N-342 to claim the renewable energy technologies income tax credit for a qualified solar or wind-powered energy system installed and placed in service in Hawaii on or after July 1, 2009.

The form also covers unused credits carried over from prior years and distributive shares of credits reported on Form N-342A. Use a separate Form N-342 for each eligible system and for carryover credits.

What you'll need

Have the following information and applicable forms ready:

• Your name and SSN or FEIN.
• The installation property's address and the date the system was installed and placed in service.
• The system's total cost, consumer incentive premiums, costs used for other credits, and any utility rebate.
• The property type: single-family residential, multi-family residential, or commercial.
• For multi-family property, your unit's square footage, the total square footage of all units, and the number of applicable units you own.
• For “Other Solar Energy Systems,” the total output capacity.
• Form N-342A, attached if you are claiming a distributive share of a credit.
• Prior-year unused credit amounts, adjusted tax liability, and other credit amounts, as applicable.

The form also calls for Schedule CR or the applicable Form F-1 schedules when reporting the credit.

How to file

Attach Form N-342 to the applicable return: Form F-1, N-11, N-15, N-20, N-30, N-35, N-40, or N-70NP.

• Complete the solar energy calculation beginning on line 1 or the wind-powered energy calculation beginning on line 27, as applicable.
• If you are only claiming a distributive share from Form N-342A, skip lines 1 through 39 and begin on line 40.
• For carryover credits, enter “CARRYOVER” on the property address line and continue to line 47, as directed on the form. Line 48 reports prior-year unused credits.
• Form N-20 and N-35 filers must stop after line 41.
• Report the calculated credit on Schedule CR or the applicable Form F-1 schedule, following the line instructions.

The supplied form does not provide a mailing address or e-filing instructions.

Common mistakes

• Combining systems or carryover credits on one form. The form requires a separate Form N-342 for each eligible system or carryover credit.
• Completing unnecessary system calculations. If you are only claiming a distributive share from Form N-342A, begin on line 40.
• Continuing past the stopping point. Form N-20 and N-35 filers must stop after line 41.
• Overlooking the refund election rules. You must have excess credit to make an election on line 42 or line 46. These elections are irrevocable.
• Skipping the other-credit worksheet. Line 52 directs you to complete the worksheet in the instructions if you claim other credits, including a nonrefundable renewable energy credit for another system.

Questions people ask

Can I choose a refundable solar energy credit?

Yes, if you have excess credit, line 42 allows an irrevocable election to treat it as refundable. This election reduces the eligible credit by 30%.

Is there a refundable election for individuals without the 30% reduction?

Line 46 provides an irrevocable election for individuals with excess solar or wind-powered energy credit. You must either have all income exempt from Hawaii taxation under a public retirement system or received as a pension for past services, or have Hawaii adjusted gross income of $20,000 or less ($40,000 or less if filing jointly). Line 47 reports the credit without the 30% reduction calculation.

What happens to unused nonrefundable credit?

Unused credit may be carried forward and used against income tax liability in subsequent years until exhausted. Line 55 calculates the unused amount to carry over.

Do incentives and rebates affect the cost used to calculate the credit?

Yes. For both solar and wind-powered systems, the form subtracts consumer incentive premiums, costs used for other credits, and utility rebates from total cost to determine actual cost.

Official sources

• https://files.hawaii.gov/tax/forms/current/n342_i.pdf