Hawaii Startup

If you're forming a Hawaii startup but you're not sure what type of business is best for you, we can help. Our Hawaii startup page has information on Trade Names, LLCs, and corporations of all type (for-profit or nonprofit; foreign corporations and domestic).

Hawaii is a great place for a startup business—the state assesses no franchise or charter tax, other than for financial institutions, which results in a welcoming environment for small businesses.

Hawaii Trade Name

A Hawaii DBA is a type of filing that enables an individual or legal business to conduct business under a new name. For example, Magic Flowers, Inc. might register a trade name as Magic Houseplants in order to market to a different group of consumers.

Incorporate in Hawaii

When a business incorporates in Hawaii, it will select a tax classification: C corporation or S corporation. Corporations are filed through the DCCA, or Department of Commerce & Consumer Affairs.

C Corporation

A C corporation is formed by filing Articles of Incorporation with the DCCA; no additional filing is required. A C corporation has a more stringent tax structure, but it also enjoys the most ownership flexibility of the two types of for-profit corporation.

S Corporation

An S corporation, on the other hand, is more restrictive as far as ownership is concerned, but it allows for a lighter tax burden. To form an S corporation, you will submit a form to the IRS after your Articles have been filed with the DCCA, requesting the IRS to tax you as an S corporation.

Hawaii Foreign Corporation

In order to do business in Hawaii, a corporation registered in another state must file in Hawaii as a Hawaii foreign corporation. Just as with a domestic corporation, a registered agent must be kept on file at all time. Whether this registered agent is a corporation or individual, it must hold a physical address in Hawaii (and not just a PO box).

A foreign corporation has other corporate responsibilities, and it is responsible for complying with them. Failure to do so may result in disqualification from being allowed to conduct business in the state.

Hawaii LLC

An LLC in Hawaii is a type of business that, like a corporation, provides limited liability to its owners and is considered a legal entity, separate from its owners.

An LLC will elect to be taxed by the IRS as a corporation, a partnership, or an individual, depending on the amount of owners it has. Like a C corporation, its ownership structure is quite flexible; like an S corporation, it is a pass-through entity.

Hawaii Nonprofit Corporation

Like a for-profit corporation, a Hawaii nonprofit corporation is filed by submitting Articles of Incorporation to the state. However, note that in order to act as a tax-exempt organization, such as a 501c3 nonprofit organization, you must receive express permission from the IRS to be treated as such. Until your 501c3 application has been accepted by the IRS, you are just a Hawaii nonprofit corporation and still responsible for paying taxes.