Haw. Rev. Stat. » Haw. Rev. Stat. / Chapter 237
Hawaii Revised Statutes

Haw. Rev. Stat. § 237-20 (2026)

  Principles applicable in certain situations

✓ current as of July 2026
Find cases: SyfertCases citing this section HI-LEGcapitol.hawaii.gov JustiaTitle on Justia CornellLII Search CasesGoogle Scholar

     §237-20  Principles applicable in certain situations.  A person or company having shareholders or members (a corporation, association, group, trust, partnership, joint adventure, or other person) is taxable upon its business with them, and they are taxable upon their business with it.  A person or company, whether or not called a cooperative, through which shareholders or members are pursuing a common objective (for example, the obtaining of property or services for their individual businesses or use, or the marketing of their individual products) is a taxable person, and such facts do not give rise to any tax exemption or tax benefit except as specifically provided.  Even though a business has some of the aspects of agency it shall not be so regarded unless it is a true agency.  The reimbursement of costs or advances made for or on behalf of one person by another shall not constitute gross income of the latter, unless the person receiving such reimbursement also receives additional monetary consideration for making such costs or advances. [L 1957, c 34, §11(i); am L 1965, c 201, §24; Supp, §117-17.1; am L 1967, c 297, §2; HRS §237-20; am L 1985, c 303, §1; am L 1986, c 340, §8]

 

Law Journals and Reviews

 

  Rule of Strict Construction in Tax Cases, a Question of Classification or Exemption.  11 HBJ, no. 4, at 98 (1975).

 

Case Notes

 

  Amounts received from manufacturer by taxpayer for warranty service work constituted, not reimbursement, but taxable gross income.  56 H. 321, 536 P.2d 91 (1975).

  "Cost" means monetary amount paid out by taxpayer for property or service furnished by a third party.  56 H. 321, 536 P.2d 91 (1975).

  Payments by joint venture to member for services rendered joint venture were subject to general excise taxation.  59 H. 307, 582 P.2d 703 (1978).

  The reimbursement provision of this section did not apply to taxpayer where taxpayer did not pay any costs or made any advances to the landlords and the record did not indicate that the taxpayer received a reimbursement of a cost or advance.  110 H. 25, 129 P.3d 528 (2006).

  Taxpayer partnership's provision of medical equipment and ancillary services to its joint venture constituted "business" under §237-2 and was thus made subject to the general excise tax by this section.  93 H. 267 (App.), 999 P.2d 865 (2000).

 

 

Notes of Decisions
Cited in 6 cases, 1975–2006 · leading case: Tax Appeal of Subway Real Est. Corp. v. Dir. of Taxation, 129 P.3d 528 (Haw. 2006).
Sort: Relevance Newest Treatment
Tax Appeal of Subway Real Est. Corp. v. Dir. of Taxation, 129 P.3d 528 (Haw. 2006). · cites it 36× “2d 283 (1977), does not apply to the present case; and (3) the reimbursement provisions of HRS § 237-20 (2001 Repl.) 3 do not apply to the present case.”
In Re Tax Appeal of Aloha Motors, Inc., 536 P.2d 91 (Haw. 1975). · cites it 35× “Bacon Company of Hawaii, Limited, hereinafter appellants, for the performance of warranty work by the appellants did not qualify as reimbursements under HRS § 237-20, but constituted gross income, and were therefore subject to the general excise tax pursuant to HRS § 237.”
In Re the Tax Appeal of Island Holidays, Ltd., 582 P.2d 703 (Haw. 1978). · cites it 19× “However, HRS § 237-20, which surprisingly was not referred to by either party to this appeal in their briefs, provides (emphasis added): §237-20 Principles applicable in certain situations.”
In re the Tax Appeal of Brewer & Co., 649 P.2d 1155 (Haw. 1982). · cites it 2× “” HRS § 237-20. A legislative design to reach virtually all transactions with economic gain or benefit as the object may also be observed in HRS § 237-2, reading: “Business” as used in this chapter, includes all activities (personal, professional, or corporate), engaged in or…”
Tax Appeal of Wasson-Bendon Partners v. Kamikawa, 999 P.2d 865 (Haw. App. 2000). · cites it 32× “HRS § 237-20 taxes the business of a partner with the partnership, HRS § 237-20 does not make taxable, distributions to a partner of the proceeds of the investment made by the partner in the partnership! In re Island Holidays[,] *272 Ltd.”
In re the Tax Appeal of Pac. Mach., Inc., 647 P.2d 288 (Haw. 1982). · cites it 2× “Applying the principle set forth quoted from § 237-20, HRS, we conclude that the court below was correct in concluding that appellee was not taxable on such reimbursement.”
Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.