Instructions For Form N-103 - Sale Of Your Home

INSTRUCTIONS

FORM N-103 (REV. 2012)

Page 4

who have made the election to do so, shall include

ing price also includes the fair market value of any

Line-by-Line Instructions

in gross income in the year the property is sold,

other property or services you received as part of

Line 1—Enter the date of sale. If you received a

conveyed, or transferred an amount equal to the

the sale. If you received any other property or ser-

federal Form 1099-S, Proceeds From Real Estate

amount of the distribution.

vices as part of the sale, the value of these items

Transactions, the date should be shown in box 1.

is not shown on federal Form 1099-S. However,

Enter on line 5 the total amount of the IHA dis-

If you did not receive a federal Form 1099-S, the

box 4 of that form should be checked.

tribution.

date of sale is the earlier of (a) the date the title

Do not include amounts you received for per-

Line 6—Enter on this line the amount of the IHA

transferred, or (b) the date the economic burdens

sonal property sold with your home. Personal

distribution not previously reported. Also include

and benefits of ownership shifted to the buyer.

property is property that is not a permanent part

this amount on Form N-11, line 10, or Form N-15,

Line 2—If part of your main home was rented out

of the home. Examples are furniture, draperies,

line 19. Identify this amount as “IHA distribution

or used for business and in the year of sale you

and lawn equipment.

reported on sale of property.”

were not entitled to deduct expenses for the part

Line 9—Selling Expenses.—Enter the total ex-

Line 7—Section 235-5.5(f), HRS, also requires

that was rented or used for business, report the

penses you paid to sell your home. These expens-

that 10% (.10) of the IHA distribution used to pur-

entire sale on Form N-103.

es include commissions, advertising, attorney and

chase residential property be added to the indi-

If you were entitled to deduct expenses in the

legal fees, appraisal fees, title insurance, transfer

vidual’s gross income or tax liability upon the sale,

year of sale for the part that was rented or used for

and stamp taxes, and recording fees. Loan charg-

conveyance, or transfer of the property if the total

business, treat the sale as two separate sales. Re-

es, such as points charged to the seller, are also

IHA distribution was not previously reported. On

port on Hawaii Schedule D-1 the part of the sale

selling expenses. Do not include fixing-up expens-

line 7, enter 10% (.10) of line 5.

that applies to the rental or business use. Report

es on this line.

The following individuals shall add 10% of the

on Form N-103 only the part of the sale that repre-

Line 11—Adjusted Basis of Home Sold.—See

IHA distribution to their gross income:

sents your main home. You must allocate between

federal Publication 523 to figure the adjusted basis

1. Individuals who purchased residential prop-

Form N-103 and Hawaii Schedule D-1 the sales

of the home you sold.

erty before January 1, 1990, and who have not

price, expenses of sale, and the adjusted basis of

made the election to report the distribution as

If you were a nonresident of Hawaii when you

the property sold. Attach a statement showing the

gross income over a ten-year period, and

purchased your old Hawaii home, do not reduce

total selling price of the property and the method

2. Individuals who purchased residential prop-

the basis of the old home by any gain on the sale

used to allocate the amounts between the two

erty after December 31, 1996, with a distribu-

of a prior home which was located outside of Ha-

forms.

tion from an IHA established prior to January

waii.

Line 5—Section 235-5.5(f), HRS, requires that

1, 1990, and who made the election to report

Line 20—Maximum Exclusion.—Enter $250,000

the amount received as a distribution from an IHA

the distribution as gross income at the time the

($500,000 if married filing a joint return) if during

property is sold.

which was used to purchase a residential property

the 5-year period ending on the date of the sale,

in Hawaii be included in the gross income of the

Include this amount on Form N-11, line 10, or

you have met the ownership and use tests.

individual.

Form N-15, line 19. Identify this amount as “10%

If you qualify to claim a reduced exclusion, use

penalty on IHA distribution.”

Individuals who purchased residential property

the Reduced Maximum Exclusion Worksheet in

before January 1, 1990, with a distribution from

The following individuals shall add 10% of the

federal Publication 523 to figure the amount to en-

an IHA must include in gross income in the year

IHA distribution to their tax liability:

ter on line 20.

the property is sold, conveyed, or transferred an

1. Individuals who purchased residential property

amount equal to the amount of the distribution, un-

after December 31, 1989, except for individu-

Line 22—Taxable Gain.—If you are reporting the

less an election was made to include one-tenth of

als who purchased residential property after

sale on the installment method, see federal Pub-

December 31, 1996, with a distribution from an

the distribution in gross income each year for ten

lication 523. All others, enter this amount on the

IHA established prior to January 1, 1990, and

years.

Capital Gain/Loss Worksheet in the Instructions

who made the election to report the distribution

for Form N-15. Form N-11 filers should include the

Individuals who purchase residential property

as gross income at the time the property is sold.

gain on Form N-11, line 10 (if not already included

after December 31, 1989 shall include in gross

Include this amount on Form N-11, line 27, or

on Form N-11, line 7).

income one-tenth of the distribution each year for

Form N-15, line 43 and fill in the oval indicating

ten years. If such individual sells the property pur-

that you are including the separate tax from Form

chased with an IHA distribution before the end of

N-103.

the ten-year period, the remaining amount of the

Line 8—Selling Price of Home.—Enter the sell-

distribution not previously reported shall be includ-

ing price of your home. Generally, this includes

ed in gross income in the year of sale.

the amount of money you received, plus all notes,

Individuals who purchase residential property

mortgages, or other debts that are part of the sale.

after December 31, 1996, with a distribution from

If you received a federal Form 1099-S, the total of

an IHA established prior to January 1, 1990, and

these items should be shown in box 2. The sell-

Instructions For Form N-103 - Sale Of Your Home - 2012 Page 4

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