(a) In addition to the amounts not taxable under § 237-24, this chapter shall not apply to amounts received by:
Terms Used In Hawaii Revised Statutes 237-24.8
- Annual percentage rate: The cost of credit at a yearly rate. It is calculated in a standard way, taking the average compound interest rate over the term of the loan so borrowers can compare loans. Lenders are required by law to disclose a card account's APR. Source: FDIC
- Business: includes all activities (personal, professional, or corporate) engaged in or caused to be engaged in with the object of gain or economic benefit either direct or indirect, but does not include casual sales. See Hawaii Revised Statutes 237-2
- company: includes every individual, partnership, society, unincorporated association, joint adventure, group, hui, joint stock company, corporation, trustee, personal representative, trust estate, decedent's estate, trust, trustee in bankruptcy, or other entity, whether such persons are doing business for themselves or in a fiduciary capacity, and whether the individuals are residents or nonresidents of the State, and whether the corporation or other association is created or organized under the laws of the State or of another jurisdiction. See Hawaii Revised Statutes 237-1
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Fiduciary: A trustee, executor, or administrator.
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Legal tender: coins, dollar bills, or other currency issued by a government as official money. Source: U.S. Mint
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Personal property: All property that is not real property.
- Truth in Lending Act: The Truth in Lending Act is a federal law that requires lenders to provide standardized information so that borrowers can compare loan terms. In general, lenders must provide information on Source: OCC
“Activities relating to the general servicing of fiduciary or custodial accounts” means those activities performed by trust companies that are directly or indirectly performed within the fiduciary or custodial relationship between the trust company or trust department of a financial institution and its client and that are not offered to any person outside of the fiduciary or custodial relationship.
“Annual percentage rate” and “finance charge” have the same meanings as defined in the federal Truth in Lending Act (15 United States Code sections 1605(a) to (c) and 1606).
“Deposit” means:
(1) Money or its equivalent received or held by a financial institution in the usual course of business and for which it has given or is obligated to give credit to:
(A) A commercial (including public deposits), checking, savings, time, or thrift account;
(B) A check or draft drawn against a deposit account and certified by the financial institution;
(C) A letter of credit; or
(D) A traveler’s check, on which the financial institution is primarily liable;
(2) Trust funds received or held by a financial institution, whether held in the trust department or held or deposited in any other department of the financial institution;
(3) Money received or held by a financial institution, or the credit given for money or its equivalent received or held by a financial institution in the usual course of business for a special or specific purpose, regardless of the legal relationship thereby established, including without being limited to, escrow funds, funds held as security for an obligation due the financial institution or others (including funds held as dealers’ reserves) or for securities loaned by the financial institution, funds deposited by a debtor to meet maturing obligations, funds deposited as advance payment on subscriptions to United States government securities, funds held for distribution or purchase of securities, funds held to meet the financial institution’s acceptances or letters of credit, and withheld taxes;
(4) Outstanding drafts, cashier’s checks, money orders, or other officer’s checks issued in the usual course of business for any purpose; or
(5) Money or its equivalent held as a credit balance by a financial institution on behalf of its customer if the financial institution is engaged in soliciting and holding the balances in the regular course of its business.
“Financial institution” means banks, building and loan associations, development companies, financial corporations, financial services loan companies, small business investment companies, financial holding companies, and trust companies all as defined in chapter 241, and mortgage loan originator companies as defined in chapter 454F.
“Leasing of personal property” occurs if:
(1) The lease is to serve as the functional equivalent of an extension of credit to the lessee of the property;
(2) The property to be leased is acquired specifically for the leasing transaction under consideration, or was acquired specifically for an earlier leasing transaction;
(3) The lease is on a nonoperating basis where the financial institution may not, directly or indirectly:
(A) Provide for the maintenance, repair, replacement, or servicing of the leased property during the lease term;
(B) Purchase parts and accessories in bulk or for an individual property after the lessee has taken delivery of the property; or
(C) Purchase insurance for the lessee;
(4) At the inception of the lease, the effect of the transaction will yield a return that will compensate the lessor financial institution for not less than the lessor’s full investment in the property plus the estimated total cost of financing the property over the term of the lease, from:
(B) Estimated tax benefits, including capital goods excise tax credit, net economic gain from tax deferral from accelerated depreciation, and other tax benefits with a substantially similar effect; and
(C) The estimated residual value of the property at the expiration of the initial term of the lease;
(5) The maximum lease term during which the lessor financial institution shall recover the lessor’s full investment in the property, plus the estimated total cost of financing the property, shall be forty years; and
(6) At the expiration of the lease, including any renewals or extensions with the same lessee, all interest in the property shall be either liquidated or leased again on a nonoperating basis as soon as practicable but in no event later than two years from the expiration of the lease; provided that in no case shall the lessor retain any interest in the property beyond fifty years after the lessor’s acquisition of the property.
