Hawaii Mileage and Vehicle Tax Records (2026): No Bonus Depreciation, a $25,000 Section 179 Limit, Employee Mileage and AV Testing
General information, not tax or legal advice. Talk to your tax preparer or attorney about your situation.
Hawaii didn't adopt federal bonus depreciation and caps Section 179 at $25,000, so a business vehicle usually needs a separate Hawaii Form 4562. Hawaii still allows unreimbursed employee expenses, including mileage, on Worksheet A-6 above a 2% floor. Its rates reach 11%. State law sets TNC insurance rules, and a 2020 act created AV testing.
Hawaii departs from federal rules in ways that matter for drivers: depreciation, Section 179 and employee expenses. This guide covers what the Hawaii Department of Taxation and the Hawaii Revised Statutes say as of October 16, 2026.
The federal baseline every Hawaii driver starts from
Most vehicle deductions begin on your federal return. If you're self-employed, you can generally use the standard mileage rate or actual expenses for the business share of your car (IRS Topic 510). For 2026 the business rate is 72.5¢ per mile for January 1 to June 30 (IR-2025-128 / Notice 2026-10) and 76¢ per mile for July 1 to December 31 (IR-2026-29 / Announcement 2026-11) (IRS standard mileage rates). EVs use the same rates; see the 2026 EV mileage rate guide. Most employees can't deduct unreimbursed car expenses federally (Topic 510). IRS Publication 463 asks for each business trip's miles, date, destination and purpose, plus total miles. Commuting stays personal (commuting vs business miles).
How Hawaii treats vehicle deductions
The 2025 Form N-11 instructions carry your business income into the Hawaii return, so a Schedule C vehicle deduction, figured with the standard mileage rate or actual costs, flows through. Hawaii's top rate is 11.00%, for example on single filers' taxable income over $325,000. Hawaii did not adopt the federal suspension of miscellaneous itemized deductions subject to the 2% floor. Employees can report unreimbursed job expenses on Worksheet A-6, line 23, with the 2017 federal Form 2106 or 2106-EZ where required; the instructions note the 2025 business mileage rate of 70 cents. See commuting vs. business miles.
Depreciation: no bonus, $25,000 Section 179
The instructions say Hawaii didn't adopt federal bonus depreciation or the increased Section 179 deduction; the Hawaii limit is $25,000. If you claimed either federally, you complete a federal Form 4562 for Hawaii purposes, attach it, report the difference on line d of the Hawaii Additions Worksheet and attach your computation. Keep both depreciation schedules for any vehicle. See robotaxi fleet depreciation and Section 179.
Rideshare (TNC) rules in Hawaii
At the state level, HRS § 431:10C-703 sets insurance and disclosure requirements for transportation network company drivers, including coverage while logged in to the app. For operating permits or local rules, check with your county. Save your own trip receipts and annual summaries. See which rideshare miles count. If you also drive on the mainland, see the California guide.
Robotaxis and autonomous vehicles in Hawaii
Act 21 of 2020 (HB 2590, approved September 15, 2020) set up an autonomous vehicle testing pilot program in the Department of Transportation. An autonomous vehicle may be tested on any public road, provided a conventional human driver stays physically present in case they need to intervene. The act asked the department to report its findings before the 2023 session. For current guidance, check with the Hawaii Department of Transportation or an attorney. For fleet records, see robotaxi fleet tax basics.
What to keep in your Hawaii records
- Each business trip's date, start, destination, purpose and miles, plus total miles for the year (Pub 463); a weekly log counts as timely kept.
- Separate Business, Commute and Personal totals for Form 4562 Part V.
- Keep records until the period of limitations runs out, generally 3 years federally (IRS); ask your preparer about the state period.
- Keep a Hawaii Form 4562 beside the federal one for any vehicle with bonus depreciation or Section 179 above $25,000.
- W-2 employees who drive for work: keep the mileage log behind Worksheet A-6 and Form 2106.
For the full list of log fields, see what the IRS asks you to record.
Example: 1,000 hypothetical business miles driven in September 2026 × 76¢ (IR-2026-29) = $760 at the federal standard rate. Miles driven in March 2026 would use 72.5¢ (IR-2025-128) instead, so keep each trip's date. Estimates, not tax advice.
One log for both returns
A Hawaii return doesn't call for a second mileage log; your preparer works from the same business, commuting and personal miles. CyberDeduct builds a mileage log around IRS Pub 463 from your Tesla's own trip and odometer data (Model S, 3, X, Y and Cybertruck). You connect your Tesla account once through Tesla's standard account sign-in (OAuth); CyberDeduct never sees or stores your password. Home/work rules and route templates label most trips Business, Commute or Personal; you tap to change any label and confirm the purpose. The dashboard shows your business-use percentage and warns you on the 28th if you're under 50%. You export a PDF or CSV log plus a Form 4562 Part V worksheet for your preparer. See how the log is built or see plans.
Sources (checked October 16, 2026)
- Hawaii Department of Taxation, 2025 Form N-11 instructions
- HRS § 431:10C-703
- Act 21, Session Laws of Hawaii 2020
- Hawaii Department of Transportation
- IRS, Standard mileage rates; IRS Publication 463; IRS Topic 510
Frequently asked questions
Does Hawaii allow bonus depreciation?
No. The N-11 instructions say Hawaii didn't adopt federal bonus depreciation, so you complete a separate Form 4562 for Hawaii and adjust on the Hawaii Additions Worksheet.
What is Hawaii's Section 179 limit?
$25,000, per the 2025 Form N-11 instructions.
Can Hawaii employees deduct work mileage?
Itemizers can report unreimbursed job expenses on Worksheet A-6, line 23, subject to the 2% floor, using the 2017 federal Form 2106 where required.
What state law covers Hawaii rideshare drivers?
HRS § 431:10C-703 sets TNC insurance and disclosure rules. Check with your county for operating rules.
Can robotaxis operate in Hawaii?
Act 21 of 2020 created a testing pilot with a human driver physically present. Check HDOT for current guidance.
This article is general information, not tax or legal advice. Talk to your tax preparer or attorney about your situation. State laws and bill status change; check the linked sources for the current text.
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