Haw. Rev. Stat. § 235-7.3
This is the official text of Haw. Rev. Stat. § 235-7.3, part of Hawaii’s Rev. Stat — part of the compiled statutory law of Hawaii, published by the state as "Rev. Stat." Browse the sections below, each linked to its official government source.
Not legal advice. This page reproduces the official text of a government statute for reference only. Laws change, and how a statute applies depends on your specific facts. For advice about your situation, consult a licensed attorney in your state.
Royalties derived from patents, copyrights, or trade secrets excluded from gross income.
Official statutory text
(a) In addition to the exclusions in section 235-7, there shall be excluded from gross income, adjusted gross income, and taxable income, amounts received by an individual or a qualified high technology business as royalties and other income derived from any patents, copyrights, and trade secrets:
(1) Owned by the individual or qualified high technology business; and
(2) Developed and arising out of a qualified high technology business.
(b) With respect to performing arts products, this exclusion shall extend to:
(1) The authors of performing arts products, or any parts thereof, without regard to the application of the work-for-hire doctrine under United States copyright law;
(2) The authors of performing arts products, or any parts thereof, under the work-for-hire doctrine under United States copyright law; and
(3) The assignors, licensors, and licensees of any copyright rights in performing arts products, or any parts thereof.
(c) For the purposes of this section:
"Performing arts products" means:
(1) Audio files, video files, audiovideo files, computer animation, and other entertainment products perceived by or through the operation of a computer; and
(2) Commercial television and film products for sale or license, and reuse or residual fee payments from these products.
"Qualified high technology business" means a business that conducts more than fifty per cent of its activities in qualified research.
"Qualified research" means:
(1) The same as in section 41(d) of the Internal Revenue Code;
(2) The development and design of computer software for ultimate commercial sale, lease, license or to be otherwise marketed, for economic consideration. With respect to the software's development and design, the business shall have substantial control and retain substantial rights to the resulting intellectual property;
(3) Biotechnology;
(4) Performing arts products;
(5) Sensor and optic technologies;
(6) Ocean sciences;
(7) Astronomy; or
(8) Nonfossil fuel energy-related technology. [L 1999, c 178, §22; am L 2000, c 297, §6; am L 2001, c 221, §7; am L 2004, c 215, §6]
(1) Owned by the individual or qualified high technology business; and
(2) Developed and arising out of a qualified high technology business.
(b) With respect to performing arts products, this exclusion shall extend to:
(1) The authors of performing arts products, or any parts thereof, without regard to the application of the work-for-hire doctrine under United States copyright law;
(2) The authors of performing arts products, or any parts thereof, under the work-for-hire doctrine under United States copyright law; and
(3) The assignors, licensors, and licensees of any copyright rights in performing arts products, or any parts thereof.
(c) For the purposes of this section:
"Performing arts products" means:
(1) Audio files, video files, audiovideo files, computer animation, and other entertainment products perceived by or through the operation of a computer; and
(2) Commercial television and film products for sale or license, and reuse or residual fee payments from these products.
"Qualified high technology business" means a business that conducts more than fifty per cent of its activities in qualified research.
"Qualified research" means:
(1) The same as in section 41(d) of the Internal Revenue Code;
(2) The development and design of computer software for ultimate commercial sale, lease, license or to be otherwise marketed, for economic consideration. With respect to the software's development and design, the business shall have substantial control and retain substantial rights to the resulting intellectual property;
(3) Biotechnology;
(4) Performing arts products;
(5) Sensor and optic technologies;
(6) Ocean sciences;
(7) Astronomy; or
(8) Nonfossil fuel energy-related technology. [L 1999, c 178, §22; am L 2000, c 297, §6; am L 2001, c 221, §7; am L 2004, c 215, §6]
Status: in_force · Read it on the official government site
Need a lawyer in Hawaii?
Find a Hawaii lawyer
About this page: Statute text is reproduced from official government publishers via the
Open US Law dataset
(Vaquill AI, snapshot v2026.08, CC BY 4.0). Primary legislative text like this is public domain under the government-edicts doctrine
(Georgia v. Public.Resource.Org, 2020). We link every section back to its official source so you can verify it independently.