HAR §18-231-9. (Reserved

) §18-231-9.4-01 Payment of taxes by credit card and debit card.  Sections 18-231-9.4-01 to 18- 231-9.4-09 implement section 231-9.4, HRS, relating to the payment of taxes administered by the department of taxation by credit card and debit card. Section 231-9.4, HRS, and these rules apply notwithstanding any contrary provision in title 14, HRS, relating to the payment of taxes. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-02 Payment of taxes by credit card and debit card; definitions.  As used in sections 18-231-9.4-01 to 18-231-9.4-09: “Department” means the department of taxation “Director” means the director of taxation. “Payor” means the taxpayer, or a third party who tenders payment on behalf of a taxpayer at the taxpayer’s request. “Tax type” means a tax administered by the department and approved by the director for payment by credit card and debit card. “Taxpayer” includes an individual, a trust, estate, partnership, association, company, or corporation; provided that an affiliated group of domestic corporations filing a consolidated return pursuant to section 235-92, HRS, shall be considered one taxpayer. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-03 Authority to receive.  (a) Payment on a tax type may be made by credit card or debit card as authorized by this section. Payment of taxes by credit card or debit card is voluntary on the part of the taxpayer. Only credit cards or debit cards approved by the Department may be used for this purpose and only in payment of the tax liabilities of the tax type specified by the Department may be paid by credit card or debit card. All such payments must be made in the manner and in accordance with the forms, instructions and procedures prescribed by the Department. All references in this section to tax also include interest, penalties, additional amounts, and additions to tax. (b) Provisions relating to payments by electronic funds transfer other than payments by credit card and debit card are contained in section 231-9.9, HRS and the rules promulgated pursuant to section 231-9.9, HRS. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-04 When payment is deemed made.  A payment of tax by credit card or debit card shall be deemed made when the issuer of the credit card or debit card properly authorizes the transaction, provided that the payment is actually received by the Department in the ordinary course of business and is not returned pursuant to §18-231-9.4-06 of this section. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-05 Continuing liability of taxpayer.  (a) A taxpayer, who tenders payment of taxes, or, on whose behalf a third party tenders payment of taxes by credit card or debit card is not relieved of liability for such taxes until the payment is actually received by the Department and is not required to be returned pursuant to §18- 231-9.4-06 of this section. This continuing liability of the taxpayer is in addition to, and not in lieu of, any liability of the issuer of the credit card or debit card or financial institution pursuant to §18-231-9.4-05(b) of this section. (b) If a payor has tendered a payment of taxes by credit card or debit card, the credit card or debit card transaction has been guaranteed expressly by a financial institution, and the Department is not duly paid, then the Department shall have a lien for the guaranteed amount of the transaction upon all the assets of the institution making such guarantee. The unpaid amount shall be paid out of such assets in preference to any other claims whatsoever against such guaranteeing institution, except the necessary costs and expenses of administration and the reimbursement of the United States for the amount expended in the redemption of the circulating notes of such institution. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-06 Resolution of errors relating to the credit card or debit card account.  (a) Payments of taxes by credit card or debit card shall be subject to the applicable error resolution procedures of section 161 of the Truth in Lending Act (15 U.S.C. 1666), section 908 of the Electronic Fund Transfer Act (15 U.S.C. 1693f), or any similar provisions of state or local law, for the purpose of resolving errors relating to the credit card or debit card account, but not for the purpose of resolving any errors, disputes or adjustments relating to the underlying tax liability. HRS §231-9.4 HRS §231-9.4 HRS §231-9.4 HRS §231-9.4 HRS §231-9.4 HRS §231-9.4 §18-231-9.4-07 ADMINISTRATION OF TAXES 231- 10 (Unofficial Compilation as of 12/31/2025) (b) (1) The error resolution procedures of paragraph (a) of this section apply to the following types of errors– (A) An incorrect amount posted to the taxpayer’s account as a result of a computational error, numerical transposition, or similar mistake; (B) An amount posted to the wrong taxpayer’s account; (C) A transaction posted to the taxpayer’s account without the taxpayer’s authorization; and (D) Other similar types of errors that would be subject to resolution under section 161 of the Truth in Lending Act (15 U.S.C. 1666), section 908 of the Electronic Fund Transfer Act (15 U.S.C. 1693f), or similar provisions of state or local law. (2) An error described in paragraph (b) of this section may be resolved only through the procedures referred to in paragraph (a) of this section and cannot be a basis for any claim or defense in any administrative or court proceeding involving the Department or the State. (c) Notwithstanding any contrary provision in title 14, HRS, relating to the refund of taxes paid, if a taxpayer is entitled to a return of funds pursuant to the error resolution procedures of paragraph (a) of this section, the Director may, in the Director’s sole discretion, effect such return by arranging for a credit to the taxpayer’s account with the issuer of the credit card or debit card or any other financial institution or person that participated in the transaction in which the error occurred. (d) The error resolution procedures of paragraph (a) of this section do not apply to any error, question, or dispute concerning the amount of tax owed by any person for any year. For example, these error resolution procedures do not apply to determine a taxpayer’s entitlement to a refund of tax for any year for any reason, nor may they be used to pay a refund. All such matters shall be resolved through administrative and judicial procedures established pursuant to Title 14 and the rules and regulations thereunder. (e) By submitting payment of taxes by credit card or debit card, the taxpayer expressly acknowledges that the transaction(s) are not subject to section 170 of the Truth in Lending Act (15 U.S.C. 1666i) or to any similar provision of state or local law. To the extent permissible, the term “creditor” as used in section 103(f) of the Truth in Lending Act (15 U.S.C. 1602 (f)) shall not include the Department with respect to credit card transactions in payment of any tax type. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-07 Fees or charges.  (a) The Department may not impose any fee or charge on persons making payment of taxes by debit card. This section does not prohibit the imposition of fees or charges by issuers of credit cards or debit cards or by any other financial institution or person participating in the credit card or debit card transaction. The Department may not receive any part of any fees that may be charged by such institution(s). (b) The Department may impose a processing fee or charge as authorized by section 40-35.5, HRS on persons making payment of taxes by credit card. This section does not prohibit the imposition of additional fees or charges by issuers of credit cards or debit cards or by any other financial institution or person participating in the credit card or debit card transaction. The Department may not receive any part of any fees that may be charged by such institution(s). [Eff 08/04/2006 (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-08 Authority to enter into contracts.  The Director may enter into contracts related to receiving payments of tax by credit card or debit card if such contracts are cost beneficial to the State. The determination of whether the contract is cost beneficial shall be based on an analysis appropriate for the contract at issue and at a level of detail appropriate to the size of the State’s investment or interest. The Department may not pay any fee or charge or provide any other monetary consideration under such contracts for such payments. [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.4-09 Use and disclosure of information relating to payment of taxes by credit card and debit card.  Any information or data obtained directly or indirectly by any person other than the taxpayer in connection with payment of taxes by a credit card or debit card shall be treated as confidential, whether such information is received from the Department or from any other person (including the taxpayer). (a) No person other than the taxpayer shall use or disclose such information except as follows– (1) Card issuers, financial institutions, or other persons participating in the credit card or debit card transaction may use or disclose such information for the purpose and in direct furtherance of servicing cardholder accounts, including the resolution of errors in accordance with §18-231-9.4-06. This authority includes the following: (A) Processing the credit card or debit card transaction, in all of its stages through and including the crediting of the amount charged on account of tax to the State; (B) Billing the taxpayer for the amount charged or debited with respect to payment of the tax liability; HRS §231-9.4 HRS §231-9.4 HRS §231-9.4 ADMINISTRATION OF TAXES §18-231-9.9-02 231- 11 (Unofficial Compilation as of 12/31/2025) (C) Collecting the amount charged or debited with respect to payment of the tax liability; (D) Returning funds to the taxpayer in accordance with §18-231-9.4-06 of this section; (E) Sending receipts or confirmation of a transaction to the taxpayer, including secured electronic transmissions and facsimiles; and (F) Providing information necessary to make a payment to other state or local government agencies, as explicitly authorized by the taxpayer (e.g., name, address, taxpayer identification number). (2) Card issuers, financial institutions or other persons participating in the credit card or debit card transaction may use and disclose such information for the purpose and in direct furtherance of any of the following activities— (A) Assessment of statistical risk and profitability; (B) Transfer of receivables or accounts or any interest therein; (C) Audit of account information; (D) Compliance with federal, state, or local law; and (E) Cooperation in properly authorized civil, criminal, or regulatory investigations by federal, state, or local authorities. (b) Notwithstanding the provisions of paragraph (a) of this section, use or disclosure of information relating to credit card and debit card transactions for purposes related to any of the following is not authorized— (1) Sale of such information (or transfer of such information for consideration) separate from a sale of the underlying account or receivable (or transfer of the underlying account or receivable for consideration); (2) Marketing for any purpose, such as, marketing tax-related products or services, or marketing any product or service that targets those who have used a credit card or debit card to pay taxes; and (3) Furnishing such information to any credit reporting agency or credit bureau, except with respect to the aggregate amount of a cardholder’s account, with the amount attributable to payment of taxes not separately identified. (c) Use and disclosure of information other than as authorized by this rule may result in civil liability under sections 235-116, HRS, 237-34, HRS, 237D-13, HRS, 251-12, HRS, and IRC 7431(a)(2) and (h). [Eff 08/04/2006] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.4) §18-231-9.9-01 Payment of taxes through electronic funds transfer; scope of rules. Sections 18-231-9.9-01 to 18-231-9.9-11 implement section 231-9.9, HRS, relating to the payment of taxes by electronic funds transfer of taxes administered by the department of taxation. Section 231-9.9, HRS, and these rules apply notwithstanding any contrary provision in title 14, HRS, relating to the payment of taxes. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) §18-231-9.9-02 Payment of taxes through electronic funds transfer; definitions. As used in sections 18-231-9.9-01 to 18-231-9.9-11: “ACH” or “Automated Clearing House” means any federal reserve bank, or an organization established by agreement with the National Automated Clearing House Association, which operates as a clearing house for transmitting or receiving entries between banks or bank accounts, and which authorizes an electronic transfer of funds between the banks or bank accounts. “ACH credit” means a transaction in which the taxpayer, through its own bank, originates an ACH transaction crediting the department’s bank account and debiting the taxpayer’s bank account for the amount of a tax payment. “ACH debit” means a transaction in which the department, through its designated depository bank, originates an ACH transaction debiting the taxpayer’s bank account and crediting the department’s bank account for the amount of a tax payment. “Addenda record” means that information required by the department in an ACH credit transfer or wire transfer, in approved electronic format. The approved electronic format is the TXP Banking Convention, used in the free form field of the National Automated Clearing House Association (NACHA) CCD+ entry. “Bank” includes any financial institution described in section 241-1, HRS, that accepts deposits. “Call-in day” means the day on which a taxpayer communicates payment information to the Data Collection Center. “Call-in period” means the time interval specified by the Data Collection Center in each call-in day during which EFT payment information received by the Data Collection Center is processed for transactions occurring on the next business day. HRS §231-9.9 HRS §231-9.9 §18-231-9.9-03 ADMINISTRATION OF TAXES 231- 12 (Unofficial Compilation as of 12/31/2025) “Data Collection Center” means the unit within the department, or a third party vendor under contract with the department or its designated bank, which collects and processes EFT payment information from taxpayers. “Department” means the department of taxation. “Due date” means the date on or before which a payment is required to be made by a taxpayer under a tax law of this state. “Electronic Funds Transfer” or “EFT” means any transfer of funds initiated through an electronic terminal, telephone instrument, computer, magnetic tape, or other means approved by the department, so as to order, instruct, or authorize a financial institution to debit or credit an account using the methods specified in these rules. EFT does not include transactions originated by checks, drafts, or similar paper instruments. “Payment information” means the data which the department requires of a taxpayer making an EFT payment and which must be communicated to the Data Collection Center. “Payor” means the taxpayer. “Payor information number” means a confidential code assigned to each taxpayer which uniquely identifies the payor and allows the payor to communicate payment information to the Data Collection Center. “Tax type” means a tax administered by the department which is subject to EFT. The tax types for which taxpayers will be required to pay by EFT are as follows: (1) Net income tax under chapter 235, HRS, which includes estimated tax; (2) Withholding tax on wages under chapter 235, HRS; (3) General excise and use taxes under chapters 237 and 238, HRS; (4) Transient accommodations tax under chapter 237D, HRS; (5) Public service company tax under chapter 239, HRS; (6) Franchise tax under chapter 241, HRS; (7) Fuel tax under chapter 243, HRS; (8) Liquor tax under chapter 244D, HRS; (9) Tobacco tax under chapter 245, HRS; and (10) Rental motor vehicle and tour vehicle surcharge tax under chapter 251, HRS. “Taxpayer” includes an individual, a trust, estate, partnership, association, company, or corporation; provided that an affiliated group of domestic corporations filing a consolidated return pursuant to section 235-92, HRS, shall be considered one taxpayer. “Threshold amount” means the amount a payment made by a taxpayer for a tax type must equal or exceed for the taxpayer to be required to use EFT when making payments for the tax type. The threshold amount is set forth in section 18-231-9.9-03(a). “Trace number” means the verification code provided by the Data Collection Center upon receipt of all payment information from the payor which uniquely identifies the completed communication of payment information. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) §18-231-9.9-03 Taxpayers subject to the EFT program.  (a) A taxpayer whose liability for any tax type was more than $100,000 in any one taxable year shall be required to participate in the EFT program upon notification by the department that the taxpayer is required to participate. A taxpayer who is required to participate shall participate for a minimum of one year. (1) The department shall excuse from participation any taxpayer that demonstrates that it did not meet the liability threshold set forth in this subsection in its prior taxable year. (2) The department may excuse from participation any taxpayer that demonstrates undue hardship from being required to participate in the EFT program. As used in this paragraph, undue hardship means more than an inconvenience to the taxpayer; it must appear that substantial financial loss will result. (b) Any taxpayer that is not required to participate in the EFT program may apply to participate in the EFT program, and any taxpayer that is required to participate in the EFT program with respect to one or more tax types may apply to participate in the program with respect to any other tax types. A taxpayer who applies to participate and who is accepted by the department shall participate for a minimum of one year. (1) Written requests for voluntary inclusion in the EFT program shall be filed with the department at least two months before the due date of the first payment to be made by EFT. (2) A taxpayer may terminate voluntary participation by filing a written notice of termination with the department at least two months before the due date of the last EFT payment to be made. (c) The department shall contact any taxpayer selected for the EFT program at its address on file with the department. Once selected for the EFT program with respect to a tax type, the taxpayer shall transmit all payments for that tax type by EFT. [Eff 12/16/95; am 3/17/2018] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) HRS §231-9.9 ADMINISTRATION OF TAXES §18-231-9.9-07 231- 13 (Unofficial Compilation as of 12/31/2025) §18-231-9.9-04 Payor information.  (a) A taxpayer selected to participate in the EFT program shall file an authorization for EFT using the ACH debit method, or shall apply for permission to use the ACH credit method or any other EFT method, on forms prescribed by the department. The forms shall be filed with the department at least two months before the due date of the first payment to be made by EFT. (b) Upon receipt of payor information, the Data Collection Center shall assign a confidential payor identification number directly to the taxpayer to be used by the taxpayer when communicating payment information to the Data Collection Center. If the taxpayer’s payor information is timely filed with the department under subsection (a), the payor identification number shall be provided to the taxpayer before the first required payment is due under the EFT program. (c) A taxpayer shall provide at least one month written notice of any change of information required with the EFT authorization form by submitting a revised form to the department. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) §18-231-9.9-05 Methods of EFT.  (a) A taxpayer participating in the EFT program shall utilize the ACH debit method unless the department permits the taxpayer to utilize another EFT method. (b) A taxpayer desiring to use the ACH credit method or any other EFT method shall apply to the department for permission to do so, and the department may grant permission for good cause shown. A taxpayer who is already using the ACH credit method to pay vendors, or is already successfully using the ACH credit method to pay taxes to other states, shall be deemed to have shown good cause to use the ACH credit method. (c) Permission to use the ACH credit method or other EFT method described in subsection (b) shall be conditioned upon the taxpayer’s agreement to provide payment information to the Data Collection Center as provided in these rules, and to bear all costs of that method (including any receiving fee charged to the department or to the state treasury). (d) The Department may require a taxpayer to use the ACH debit method, and may revoke any permission given to that taxpayer to use any other EFT method, if the taxpayer: (1) Does not consistently transmit error-free payments; (2) Substantially varies from the requirements and specifications of these rules; (3) Repeatedly fails to make timely EFT payments or timely provide payment information; or (4) Repeatedly fails to provide the required addenda record with the EFT payment. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) §18-231-9.9-06 Communication with Data Collection Center. A taxpayer participating in the EFT program shall communicate payment information to the Data Collection Center through: (1) Operator-assisted communication of payment information made orally by rotary or touch- tone telephone; (2) Communication of payment information by way of a computer with a modem; or (3) Such other means of communication as the Data Collection Center may permit with the approval of the department. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) §18-231-9.9-07 Payment transmission, errors and omissions; penalties.  (a) A taxpayer which transmits an incorrect payment amount to the Data Collection Center shall, on the nearest business day to the date on which the error is discovered, contact the department for specific instructions. (1) If the taxpayer error involves an overpayment of tax, the taxpayer may either elect to have the overpayment applied against the liability for the next reporting period or apply for a refund under the provisions of the applicable tax law. (2) If the taxpayer error involves an underpayment of tax, the taxpayer must make appropriate arrangements to initiate payment for the amount of the underpayment. (b) If a taxpayer using the ACH debit method communicates payment information to the Data Collection Center after the call-in period on the business day before the due date, the payment shall be posted to the taxpayer’s account on the next business day following the due date and shall constitute late payment. (c) Except as otherwise provided in sections 18-231-9.9-01 to 18-231-9.9-11, failure to make a timely EFT payment shall result in assessment of appropriate penalties and interest, unless the failure is due to reasonable cause and not to neglect. See section 18-231-9.9-09 for examples of reasonable cause. (d) If an EFT transfer is rejected by the taxpayer’s financial institution, such as because of insufficient funds in the taxpayer’s account, the department shall assess the processing fee authorized by section 40-35.5, HRS. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §§40-35.5, 231-9.9) HRS §231-9.9 HRS §231-9.9 HRS §231-9.9 §18-231-9.9-08 ADMINISTRATION OF TAXES 231- 14 (Unofficial Compilation as of 12/31/2025) §18-231-9.9-08 Procedures for payment by EFT.  (a) A taxpayer in the EFT program shall also file periodic and annual returns in the same manner as if the taxpayer were not in the EFT program. Instead of attaching a check or money order to the return, however, the taxpayer shall follow procedures established by the department to coordinate the EFT payment with the proper return. If a taxpayer participating in the EFT program desires to make a payment under protest within the meaning of section 40-35, HRS, the protest shall be filed with the tax return to which it applies, irrespective of when the EFT payment was authorized or made. (b) The rules in this subsection apply to taxpayers using the ACH debit method. (1) To assure the timely receipt of payment of tax, a taxpayer shall initiate the payment transaction with the Data Collection Center in time for the payment to be deposited to the state treasury on or before the appropriate due date. Thus, in general, the taxpayer shall report payment information to the Data Collection Center, by the approved means of communication, no later than the end of the call-in period on the business day before the due date of the payment. (2) After establishing contact with the Data Collection Center, the taxpayer may communicate payment information for more than one tax type or tax period. However, the taxpayer must initiate payment information for each tax type and for each tax period for which a payment is due. (3) A trace number will be issued at the conclusion of the communication of the payment information for each tax type and tax period. This number provides a means of verifying the accuracy of the recorded tax payment and serves as a receipt for the transaction. (4) The department shall bear the costs of processing ACH debit method payments through the Data Collection Center. Example: A taxpayer uses the ACH debit method to remit the March, 1996 payment of general excise and use tax. The taxpayer first determines that the total amount of tax due is $12,345. Before the end of the call-in period on April 29, 1996, the taxpayer shall contact the Data Collection Center. After establishing contact, the taxpayer shall communicate to the Data Collection Center its payor identification number, tax type (general excise and use tax), document type (monthly return), payment amount ($12,345), and tax period (March, 1996). At the end of the communication, the taxpayer will receive a trace number which will verify the accuracy of the recorded tax payment and serve as a receipt for the transaction. Payment information involving the ACH debit transfer will be electronically transmitted to the department on April 29, 1996, shortly after the expiration of the call-in period. The actual tax payment of $12,345, however, will not be transferred to the state treasury until the following day, April 30, 1996. The taxpayer shall also file its monthly return in the normal manner, except that the taxpayer shall follow procedures established by the department to coordinate the EFT payment with the proper return, instead of attaching a check or money order to the return. (c) The rules in this subsection apply to taxpayers using the ACH credit method or any other EFT method. (1) Taxpayers who have been granted permission to use the ACH credit method or any other EFT method shall contact their own financial institutions and make arrangements to transfer the tax payment to the state treasury. (2) The department shall not bear the costs for taxpayers to use the ACH credit method or any EFT method other than the ACH debit method. (3) To assure the timely receipt of payment of tax, a taxpayer shall initiate the payment transaction with its financial institution in time for the payment to be deposited to the state treasury on or before the appropriate due date. (4) Any ACH credit transfer or any other EFT must be accompanied by an addenda record, in the format specified by the department, which includes all of the information required by the department. (5) If a taxpayer repeatedly fails to provide the department with the required addenda record, the department may require the taxpayer to use the ACH debit method. Example: A taxpayer uses the ACH credit method to remit the March, 1996 payment of general excise and use tax. The taxpayer first determines that the total amount of tax due is $12,345. At a time arranged between the taxpayer and the taxpayer’s financial HRS §231-9.9 ADMINISTRATION OF TAXES §18-231-9.9-09 231- 15 (Unofficial Compilation as of 12/31/2025) institution, the taxpayer provides the financial institution with the information necessary to initiate a transfer of the March, 1996 tax payment and an accompanying addenda record that will be posted to the state treasury on April 30, 1996. To be timely, the ACH credit transfer of March, 1996 general excise and use tax must be deposited to the state treasury as collected funds on or before April 30, 1996. The taxpayer shall also file its monthly return in the normal manner, except that the taxpayer shall follow procedures established by the department to coordinate the EFT payment with the proper return, instead of attaching a check or money order to the return. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231- 9.9) §18-231-9.9-09 Due date for EFT payment; reasonable cause for untimely payment.  (a) Taxpayers participating in the EFT program must initiate the transfer so that the amount due is deposited to the state treasury on or before the due date under the appropriate tax law. If the due date prescribed under the tax law falls on a Saturday, Sunday, or Hawaii state holiday, the payment shall be due on the next day that is not a Saturday, Sunday, or Hawaii state holiday. The occurrence of a federal holiday that is not a Hawaii state holiday, or a holiday observed by the state in which the taxpayer’s financial institution is located, shall not be considered reasonable cause for untimely payment. Example 1: X, a taxpayer participating in the EFT program for withholding taxes, is required to remit a payment of withholding taxes on or before May 10, 1997. X authorizes the EFT before the end of the call-in period on May 9, 1997. May 10, 1997 is a Saturday, so the transfer of funds is made on Monday, May 12, 1997. Because the payment is due on Monday, May 12, 1997, the EFT payment is timely. Example 2: X, a taxpayer participating in the EFT program for withholding taxes, is required to remit a payment of withholding taxes on or before November 10, 1997. X authorizes the EFT before the end of the call-in period on November 10, 1997, because November 9, 1997, is a Sunday. The transfer of funds is made on Tuesday, November 11, 1997. Because the payment is due on Monday, November 10, 1997, the EFT payment is late. Example 3: X, a taxpayer participating in the EFT program for withholding taxes, is required to remit a payment of withholding taxes on or before June 10, 1997. X authorizes the EFT before the end of the call-in period on June 9, 1997, a Monday. However, X’s financial institution is closed on June 9, 1997, because it is a holiday in the state in which that financial institution is located. Furthermore, June 11, 1997, is Kamehameha Day, a legal holiday observed in Hawaii. As a result, the transfer of funds is not made until Thursday, June 12, 1997. Because the payment is due on Tuesday, June 10, 1997, the EFT payment is late. (b) The following shall be considered reasonable cause for failure to make a timely EFT payment: (1) The inability to access the EFT system on the required date because of a system failure beyond the reasonable control of the taxpayer; (2) The failure of the EFT system to properly apply a payment; (3) The failure of the EFT system to issue proper verification of receipt of payment information; or (4) The failure to make a timely payment was caused by an error made by the Data Collection Center, the state treasury, or the department. (c) During the first six-month period a taxpayer is required to remit tax by EFT, the department may waive otherwise applicable penalties if the taxpayer demonstrates that: (1) A good faith effort to comply was made; (2) Circumstances beyond the taxpayer’s reasonable control prevented compliance by the required date; or (3) A mistake or inadvertence prevented timely payment when the taxpayer attempted to correctly and timely initiate an EFT transaction. In determining whether to grant a waiver of penalties under this subsection, the department may consider the taxpayer’s payment history, experience with EFT payments in this and other jurisdictions, and the taxpayer’s prior compliance with these rules. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §§231-21, 231-9.9, 231-39) HRS §231-9.9 §18-231-9.9-10 ADMINISTRATION OF TAXES 231- 16 (Unofficial Compilation as of 12/31/2025) §18-231-9.9-10 Penalties for use of an unauthorized payment method. (Reserved) [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9) §18-231-9.9-11 Confidentiality agreement with Data Collection Center. Before being authorized by the department to undertake official duties as set forth in sections 18-231-9.9-01 to 18-231-9.9-11, the Data Collection Center shall agree that it shall be subject to the same laws regarding confidentiality of tax returns and tax return information that apply to employees of the department, including sections 235-116, 237-34, 237D-13, 238-13, 239-7, 241-6, 244D-13, 245-11, and 251-12, HRS. [Eff 12/16/95] (Auth: HRS §231-3(9)) (Imp: HRS §231-9.9)