By Liʻulā Christensen, Esq., NHLC Senior Staff Attorney
Real property taxes are burdensome but must be kept current to avoid tax liens and foreclosures. Counties offer a variety of exemptions that may apply to your property to reduce real property tax amounts.
The four counties offer a kuleana property tax exemption that reduces the real property tax on kuleana lands to at least the minimum real property tax. To qualify, the kuleana land must be owned in whole or in part by a lineal descendant of the person that received the original title to the kuleana. This lineal descent can be proven by court order or through the Office of Hawaiian Affairs’ genealogy verification services.
For the exemption, “kuleana land” means those lands awarded to native tenants pursuant to the Kuleana Act of 1850. These Land Commission Awards allowed makaʻāinana to claim lands that they were actively cultivating plus an additional ¼ acre for a house lot but required a survey and two witnesses to validate the claim. As a result, only 28,658 acres of kuleana lands were awarded to makaʻāinana.
Only Maui County recognizes that many makaʻāinana took advantage of a provision allowing them to purchase government lands at a minimum of 50 cents per acre, resulting in 167,290 acres being purchased by makaʻāinana. The County of Maui calls these lands “Kuleana Act government grant land” and offers the same tax exemption for these lands as well. Maui County is progressive in exempting the qualifying land from real property taxes, delinquent taxes, and penalties.
The other counties require payment of the minimum tax and provide no retroactive relief.
Maui County also offers the ʻĀina Kūpuna exemption for land located in the special management area owned in whole, or part, by one or more descendants of the person who owned the property at least 80 years prior to the application and assessed over $10,000 in taxes over the prior 10 years.
The owner may dedicate the property as ʻĀina Kūpuna for a period of 10 years to qualify to pay the minimum tax. Like the kuleana exemption, descendency can be proven by court order or through OHA verification. The dedicated property cannot be conveyed to a non-descendant or used for commercial purposes for the 10-year period, or it will be subject to retroactive taxes and penalties.
Finally, real property taxes are based on the assessed value, tax classification, and any applicable exemptions for the property, which may be appealed if you disagree with the county’s assessment. Deadlines to file appeals are short: Maui’s and Hawaiʻi’s assessment notices are mailed by March 15 with appeals due by April 9; for Kauaʻi, appeals are due by December 31 preceding the tax year; and for Honolulu, notices are mailed by December 15, with appeals due by January 15. If successful, an appeal may result in lower real property taxes for your property.
E Nīnau iā NHLC provides general information about the law. E Nīnau iā NHLC is not legal advice. You can contact NHLC about your legal needs by calling NHLC’s offices at 808-521-2302. You can also learn more about NHLC at nativehawaiianlegalcorp.org.
