N-586: Tax Credit for Low-Income Housing (Revision 2024)
Hawaii · Hawaii DoTax · Used for tax years 2024, 2025, 2026
Hawaii Form N-586 is a schedule used to calculate and claim the tax credit for low-income housing. It reports new credits, credits received through other entities, unused credit carryovers, and the amount applied against tax liability. It also includes a section for reporting cre
Who files this form
Form N-586 is used to claim Hawaii’s low-income housing tax credit, including credits received through an S corporation, partnership, trust or estate, or cooperative.
If your building was placed in service after December 31, 2011, and you elected to take the low-income housing tax credit loan, the form says you cannot claim this credit and should not complete Form N-586.
What you'll need
Have these forms and details ready, as applicable:
- Copies of federal Forms 8586, 8609, and 8609-A. The form requires these attachments.
- Your name as shown on your return, Social Security number or federal employer identification number, and tax year information.
- Building names, addresses, and the month and year each building was placed in service.
- The credit amount allocated by the Hawaii Housing Finance and Development Corporation (HHFDC).
- Schedule K-1 from Form N-35, N-20, or N-40, or federal Form 1099-PATR, for credits received from another entity. You also need the entity’s name and federal employer identification number.
- Any unused low-income housing credit carried over from prior years, your adjusted tax liability, and other nonrefundable credit amounts.
- Federal Form 8611 and applicable Schedule K-1 or Form 1099-PATR amounts if reporting credit recapture.
How to file
Attach Form N-586 and a copy of federal Form 8586 to whichever return applies: Form N-11, N-15, N-20, N-30, N-35, N-40, N-70NP, F-1, or the annual premium tax return, Form 314. Attach copies of Forms 8609 and 8609-A to Form N-586.
Enter the start and end of your tax year in the spaces provided. Follow the form’s directions to transfer the credit amounts to Schedule CR or the applicable return.
The supplied form does not provide a mailing address or e-filing directions.
Common mistakes
- Starting on the wrong line: If you are only claiming a credit from a flow-through entity, the form says to start on line 5.
- Continuing past the stopping point: Pass-through entities and Form 314 filers stop after line 7 and enter that amount on the appropriate lines of their return. Form N-40 filers reporting the trust or estate’s share continue to line 8.
- Completing Part II when it does not apply: Form N-20, N-35, and Form 314 filers must not complete Part II.
- Missing required attachments: Attach federal Form 8586 with the schedule and include copies of Forms 8609 and 8609-A.
- Claiming the credit despite the loan election warning: If you answer yes to the low-income housing tax credit loan question on line 2b, do not complete this form.
Questions people ask
Can I carry forward an unused credit?
Yes. Line 14 says unused credit may be carried over and used against tax liability in subsequent years until exhausted.
How much credit can I apply this year?
Line 13 uses the smaller of your tentative current-year credit on line 9 or your remaining tax liability on line 12, rounded to the nearest dollar.
What if I am claiming other nonrefundable credits?
Complete the credit worksheet on page 2 and enter the total on line 11. If you are not claiming other nonrefundable credits, enter zero.
Where do I report credit recapture?
Use Part III. Enter the total recapture from Part III, line 7, on the proper line of your tax return.