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Understanding Kauai Property Taxes

Hawai’i may not be known for having the most affordable real estate in the country, but we are fortunate to have some of the lowest property tax rates. Real estate taxes in Hawai’i are based on a combination of both the county’s assessed value of the property and how the property is used. Tax rates and exemptions do vary slightly between islands as each county is responsible for administering and collecting its own taxes.

Kaua’i County 2018 Tax Rates

(Per $1,000 Net Assessed Valuation)

Tax Rate

Homestead

$3.05

Residential

$6.05

Residential Investor

$8.05

Vacation Rental

$9.85

Hotel and Resort

$10.85

Commercial

$8.10

Commercialized Home Use

$5.05

Industrial

$8.10

Agricultural

$6.75

Conservation

$6.75

If your primary residence is on Kaua’i, your property tax rate is just $3.05 per $1,000 of assessed value. You may also qualify for the “Single Home Exemption,” which will take $160,000 off of that assessed value. Let’s break that down with an example… you own a home with an assessed value of $800,000. With the home exemption, that brings it down to $640,000. Using the tax rate above (.00305 x $640,000), we can now determine that the property tax for that year will be $1,952.

Property on Kaua’i is taxed at fee simple market value. Because the County has only a few appraisers for approximately 35,000 taxable parcels, a personal inspection of your property is normally done only at the time of construction or remodeling. From then on, The “Mass Appraisal Method of Valuation” is used. If you own a home in Hawaii, you can check your home’s assessed value here. If you disagree with your properties valuation, you may appeal through the County.

There are several exemptions that may be available to you. The most common is the “Single Home Exemption.” Principle homeowners up to 60 years of age are eligible for an exemption of $160,000. That amount increases to $180,000 for ages 60 to 70 and increases to $200,000 for those 70 and older. There are additional exemptions pertaining to income and disabilities. You can find more information here.

When purchasing property on Kaua’i, you may start out paying a higher tax rate depending on how the previous owner used the property. To take advantage of the attractive “Homestead” tax rate and home exemption, your ownership needs to be recorded at the Bureau of Conveyances in Honolulu on or before September 30th, preceding the tax years for which you claim the exemption. The tax rate and exemption will then go into effect on July 1st in the next succeeding fiscal year. This can be a long timeline if you purchased your home just after the September 30th deadline.

Important Dates

The tax year begins on July 1 and extends until June 30 the following year. These are the important dates to remember:

Date

Importance

Sept 30

Deadline for filing exemption claims and recordation of ownership documents

Oct 1

Assessment set for use during next tax year

Dec 1

Assessment notices mailed

Dec 31

Deadline for assessment appeals

Jan 20

Second half year tax bills mailed

Feb. 20

Second half tax year payment is due

Mar 31

Certified assessment roll to County Council

June 20

Tax Rate set by County Council

July 1

Tax Year Commences

Deadline for filing dedication petitions

July 20

First half year tax bills mailed

Aug. 20

First half tax payments due

For more information about Kaua’i property taxes, please visit www.kauai.gov/RealProperty. If you’d like to talk about purchasing real estate on Kaua’i, give me a call.

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