MAINE	SUPREME	JUDICIAL	COURT Reporter	of	Decisions Decision: 201 9 ME 19 Docket: Yor

- 18

- 115 Argued : November	6,	2018 Decided: January	29,	2019 Panel: SAUFLEY,	C.J.,	and	ALEXANDER , MEAD, GORMAN,	JABAR , HJELM, and HUMPHREY, JJ.
ERIC	V.	WARNQUIST	et	al.

v. STATE	TAX	ASSESSOR

HUMPHREY ,	J. [¶1] Eric	 V.	 Warnquist	 and	 Rosamond	 C.	 Warnquist	 appeal	 from	 a
summary judgment entered	by the	Superior	Court	(York County , O ’ Neil, J. ) in favor	of the	State	Tax	Assessor	(the	Assessor)	on	the	Warnquists ’ appeal	from the	assessment	of	tax	on	certain	foreign	income. See M.R.	Civ.	P.	80C ; 5 M.R.S. § 11001	(2017)

. [¶ 2 ] T he	Warnquists claim	that the	court mis interpret ed and mis appli ed 36	M.R.S.	§	5217

- A (2017) regarding the income tax	credit	available to	them for
income	 tax es paid	 to a	 foreign	 jurisdiction .	 	 They	 also challenge	 the court ’ s determination	 that	 the penalties	 and	 interest assessed against	 them	 for	 the 2012	 and	 2013	 tax	 years were	 appropriate

. See 36	M.R.S.	 §§	 186 , 187

- B(7) (2017)

. We	affirm	the	court ’ s	judgment.2 I.		BACKGROUND [¶ 3 ] The	following	facts	are	drawn	from	the properly	formed	portions	of the parties ’ statements	 of	 material	 facts	 and	 their	 stipulated	 exhibits. See
BCN Telecom, Inc.	v.	State	Tax	Assessor ,	2016	ME	165,	¶	3,	151	A.3d	497. [¶ 4 ] The	Warnquists	are	residents	of	Cape	Neddick,	Maine , and own	two rental	properties	in the	county	of Rogaland, in	the	country	of Norway.		One	of the properties	is	a	single

- family	home	and	the	other	is	an	industrial	complex. In	2013, the	home was	taken	by	“expropriation,”	the	Norwegian	equivalent	of eminent	domain.		The	Warnquists	paid	income	tax es to Rogaland on	the	rental income	 from	 both	 properties and	 on	 the	 income	 from	 the	 expropriation

— $208,860	in	2012	and	$238,374	in	2013. The Rogaland tax es were based	on the	Warnquists ’ gross	income	and did	not	include	any	deductions	for	expenses related	to the	properties. [¶ 5 ] On	 their	 2012	 and	 2013	 federal tax	 returns,	 t he	 Warnquists reported	the ir Norwegian	income,	as	well	as	income	from	interest,	dividends, and	 pensions	 sourced	 in	 Maine, and deducted from	 this	 income certain expenses	allowed	by	the	federal	tax	code ,	including	expenses associated	with the properties ,	 to	 establish	 their	 federal adjusted	 gross	 income	 (AGI)

.3 The Warnquists	 then	 imported	 their	 federal	 AGI	 to	 their	 Maine	 tax	 returns.
36 M.R.S.	§	5102(1

- C)(A)	(2017). [¶ 6 ] To avoid what	they	viewed	as double	taxation	on	the	income	from the properties ,	 t he	Warnquists	 claimed	 a	 tax	 credit on	 their 2012	 and	 2013
Maine	returns , pursuant	to	36	M.R.S.	§	5217

- A , for the full amount	of	the income
taxes they paid	 to Rogaland ,	which	was based	 on	 the	gross	income from the properties. For	each	tax year,	t he Warnquists	used	a	“Worksheet	for	Credit	for Income	 Tax	 Paid	 to	 Other	 Jurisdiction , ”	 issued	 by	 Maine	 Revenue	 Services (MRS) ,	 to calculate the section	5217

- A	credit

. Instructions	on	 the worksheet guid e taxpayers through each	step	of	the credit cal culation. B ecause	the	credit the Warnquists claimed in	 both	 years exceeded	 the amount	 of	 their Maine
income tax	obligation s , they	paid	no	Maine	income	tax es . [¶ 7 ] In	2014,	the Assessor 1 audited	the Warnquists ’ 2012	and	2013	tax
returns. The	Assessor increased the Warnquists ’ standard deduction for 2012, but	 also determined	 that	 the	Warnquists	 had	 claimed	 a	larger	 credit	 than	is allowed	 under	 section	 5127

- A	 because	 they	 overstated	 the	income	 that	was

1 The	Assessor	is	the	executive	director	of	MRS. See	Leadership ,	Dep ’ t	of	Admin .	&	Fin.	Servs. , https://www1.maine.gov/dafs/about/leadership (last	visited	Jan.	23, 2019) ; see	also Dep ’t of	Admin

. & Fin

. Servs

. ,	 Bureau	 of	 the	 Budget, Maine	 State	 Government	 Annual	 Report	 2017

- 2018 (2018) , https://www.maine.gov/budget/sites/maine.gov.budget/files/inline

- files/2018%20Annual%20Re port_1.pdf

.4 taxed	by both Rogaland	and	the S tate	of	Maine. 2 T he As s essor calculated	the portion	of	 the	Warnquists ’ Rogaland	income	 that	was	subject	 to	 tax	in	Maine and,	based	on	that	calculation,	adjusted	the	Warnquist s ’ section	5217

- A	credits for	both	tax	years	and	issued	assessments	for	tax,	interest,	and	penaltie s . [¶ 8 ] After	 receiving	 notice of the recalculation s , adjusted	 credits , and
assessments from	 the Assessor ,	 together	 with	 an	 explanation	 of how	 to properly	calculate the section 5127

- A	credit, 3 the	Warnquists	timely petitioned the Assessor for reconsider ation	of its decision	pursuant	to 36	M.R.S.	§	151(1) (2017). The	Assessor denied	the	petition

. [¶ 9 ] The	Warnquists	 then	 appealed	 to	 the	 Board of	 Tax	 Appeals	 (the Board)

. 36	M.R.S.	§	151(2)(F)(1)	(2017). The	Board	reduced	the	tax	assessed for	2012	by	$66	because	the	Warnquists	understated	their	allowable	standard deduction,	 but	 otherwise	 upheld	 the	 assessments	 in	 a	 decision	 dated July 21, 2016.		The	Warnquists	sought	reconsideration	of	the	Board ’ s	decisi on ;

2 In	Maine,	income	is	taxed after	deductions for	expenses	(net	income),	while	in	Norway,	income is	taxed without	any	deductions (gross	income). See 36	M.R.S.	§§	5121,	5142	(2017).

3 This	was	not	the	first	time	the	Assessor	explained	to	the	Warnquists	how	to	calculate	the	section 5 217

- A	credit.		The	Assessor	imposed	substantial	understatement	penalties	 on	 the	Warnquists	in 2008,	2009,	2010,	and	2011	for	similar	section	5217

- A	miscalculations	and	issued	letters	explaining how	to	properly	assess	the	credits	they	were	entitled	to	in	th ese	years.5 the	Board	denied	that	request	on	August	18,	2016. See 4 C.M.R.	18	674	100

- 9 § 305(1),	(2)	(2017). [¶1 0 ] On	October	18,	2016, the Warnquist s filed	a	petition	 for	 review pursuant	to	M.R.	Civ.	P.	80C and 5	M.R.S.	§	11001 requesting	that	the	Superior Court	grant	 them	 relief	 from the tax,	penalties,	 and	interest	imposed	against them

. 4 36	 M.R.S.	 §	 151

- D(10)(I)	 (2017). They	 argued	 that	 under	 section 5217

- A,	they	were	entitled	to	a	credit	for all of	the	taxes	paid	to Norway

— e ven though	that	credit	was	greater	than	the	amount	of	taxes otherwise due to Maine on	 that	 same income

— and	 further asserted that	 the	 court	 should	 abate	 the penalties	 and	 interest	 assessed	 against	 them	 pursuant	 to 36	 M.R.S.	 §§	 186 , 187

- B(7). In	response,	the	Assessor	filed	a	motion	for	summary	judgment	on September	19,	2017. [¶1 1 ] On	March	7,	2018,	the	Superior	Court	(York, O ’ Neil,	J .)	granted	the
Assessor ’ s	 motion	 for	 summary	 judgment,	 upholding	 the tax,	 penalties , and interest	 assessed	 against	 the	Warnquists. The	 court	 held	 that	 there	 was	 no

4 Because	 a	 determination	 by	 the	 Assessor	 or	 the	 Board	 is	 not	 considered	 “an	 adjudicatory proceeding	within	the	meaning	of	that	term	in	the	Maine	Administrative	Procedure	Act,”	the	Superior Court	reviews	the	assessment	of	taxes	de	novo. 36	M .R.S.	§§	151(2)(D),	151

- D(10)(I)(4)	(2017); see also BCN	Telecom,	Inc.	v.	State	Tax	Assessor ,	2016	ME	165,	¶ 2 ,	151	A.3d	497. “The	court	shall	make its	own	determination	as	to	all	questions	of	fact	or	law,	regardless	of	whether	the	questions	of	fact	or law	 were	 raised	 before	 the	 division	 within	 the	 bureau	 making	 the	 original	 determination	 [the Assessor]	or	before	the	board.”		36 M.R.S.	§ 151

- D(10)(I).6 genuine	issue	 of	material	 fact	 pursuant	 to	M.R.	 Civ.	 P.	 56(c)	 and	interpreted section	5217

- A	to	limit	the	credit	available	to	a	taxpayer	to	an	amount	no	larger “in	 relation	 to the	 total	 amount	 of	 taxes	 owed	 than	 the	 proportion	 that	 the taxpayer ’ s	 adjusted	 gross	 income	 from	 the	 foreign	 jurisdiction	 bears	 to	 the taxpayer ’ s	 entire	 Maine	 adjusted	 gross	 income.” After	 noting that	 the Warnquists had not been “double	 taxed,” the	cour t	held that	 the	Warnquists had failed	 to establish reasonable	 cause	 for	 a	 waiver	 or	 abatement of	 the assessed penalties	and failed	to	satisfy	the	court	that	they	were	entitled	to	an abatement	 of	 the	 assessed interest

. See 36	 M.R.S.	 §§	 186,	 187

- B(7). The Warnquists	then	timely	appealed. See M.R.	App.	P.	2B(c).
II.		DISCUSSION [¶1 2 ] In	considering	an	 appeal	 from	 a	 summary	judgment,	we	 review de novo	whether	there	was	no	genuine	issue	of	material	fact	and whether either party	was	entitled	to	judgment	as	a	matter	of	law. See M.R.	Civ.	P.	56(c); Blue Yonder,	LLC	v.	State	Tax	Assessor ,	2011	ME	49,	¶	7,	17	A.3d	667 .		Because ,	in	an appeal	from	the	Maine	Board	of	Tax	Appeals, the	Superior	Court i s	authorized to	rule	on legal	matters	de	novo, see 36	M.R.S.	§ 151

- D(10)(I),	we	review	 the
court ’ s	interpretation of	 the	law directly	and	do	not	defer	 to	 the interpretive ruling of	 the	 Assessor	 or	 the	 Board

. See	 Blue	 Yonder ,	 2011	 ME	 49,	 ¶¶	 6

- 7,7 17 A.3d 667 ; see	also BCN	Teleco m ,	2016	ME	165,	¶	2,	151	A.3d	497. On	appeal , the	 Warnquists challenge the	 Superior	 Court ’ s interpretation	 of 36 M.R.S. § 5217

- A and	 its	 denial	 of	 their	 requ est	 to	 abate	 the	 penalties	 and	 interest assessed	against	them.
A. Section	5217

- A [¶1 3 ]	 	 The Warnquists contend that section 5217

- A permit s them to claim	a	credit against	their	Maine	income	tax	obligation for all of	the	income	tax they	paid	to Rogaland

. T he	Assessor	argues	that	section	5217

- A	allows	a	credit only for the ta x	 the Warnquists paid	 to Rogaland on income	 that	is taxed	by both Maine and	Rogaland

. [¶1 4 ] We	 review	 de	 novo the	 Warnquists ’ challenge	 to	 the	 court ’ s interpretation of	section	5217

- A

. S ee Sears,	Roebuck	&	Co.	v.	State	Tax	Assessor , 2012	ME	110,	¶	8,	52	A.3d	941

. Section	5217

- A provides: A	 resident	 individual	 is	 allowed	 a	 credit against	 the	 tax otherwise	 due	 under	 this	 Part .	 .	 .	 for	 the	 amount	 of	 income	 tax imposed	on	that	individual	for	the	taxable	year	by	.	.	.	any	political subdivision	of	a	foreign	country	that is	analogous	to	a	state	of	the United	States	with	respect	to	income	subject	to	tax	under	this	Part that	 is derived	 from	 sources in	 that	 taxing	 jurisdiction.	 	 In determining	whether	income	is	 derived	 from	 sources	in	 another jurisdiction,	 the	 assessor	 may	 n ot	 employ	 the	 law	 of	 the	 other jurisdiction but	 shall	 assume	 that	 a	 statute	 equivalent	 to	 section 5142	applies in	that	jurisdiction.		The	credit,	for	any	of	the	specified taxing	 jurisdictions,	 may	 not	 exceed	 the	 proportion	 of	 the	 tax otherwise	 due	 under	 th is	 Part,	 excluding	 the	 tax	 imposed	 by8 section	 5203

- C, that	 the	 amount	 of	 the	 taxpayer ’ s	Maine	 adjusted gross	income	derived	from	sources	in	that	taxing	jurisdiction	bears to	the	taxpayer ’ s	entire	Maine	adjusted	gross	income

.	.	.	. ( e mphasis	added)

. 5 [¶1 5 ] “In	interpreting	a	tax	statute,	we	look	first	to	its	plain	meaning	to give	effect	to	the	Legislature ’ s	intent.” State	Tax	Assessor	v.	MCI	Comm c’ s.	Servs ., 2017	ME	119,	¶	7,	164	A.3d	952. When	a tax statute	provides	a	credit,	it	must be	 narrowly	 co nstrued. Goggin	 v.	 State	 Tax	 Assessor ,	 2018	 ME	 111,	 ¶	 14,
191 A.3d	 341 ; see	 also Foster	 v.	 State	 Tax	 Assessor ,	 1998	 ME	 205,	 ¶	 8,
716 A.2d 1012 (it	is	well	settled	that	“taxation	is	the	rule	and	tax	exemption	is the	 exception”).	 	 The	 taxpayer	 seeking	 the	 credit “ must	 show	 that	 it	 is unmistakably	within	the	spirit	and	intent	of	the	statute.” DaimlerChrysler	Servs.,
N. A m ., LLC v.	 State	 Tax	 Assess or ,	 2003	 ME	 27,	 ¶	 7,	 817	 A.2d	 862 (quotation marks	omitted); see	also 36 M.R.S.	§	151

- D(10)(I)	( “The burden	of	proof is on taxpayer .” ).

5 Title	 36	 M.R.S.	 §	 5142,	 which	 deals	 with	 computation	 of	 taxable	 income	 of	 nonresident individuals,	provides	in	relevant	part: 1. General

. The	Maine	adjusted	gross	income	of	a	nonresident	individual	derived from	or	connect ed	with	sources	in	this	State	is	the	sum	of	the	following	amounts:
A. The	net	amount	of	items	of	income,	gain,	loss,	and	deduction	entering	into the	 nonresident	 individual's	 federal	 adjusted	 gross	 income	 that	 are	 derived from	or	connected	with	sources	in this	State

.	.	. .9 [¶1 6 ]		Because	 the	section	521 7

- A credit reduces	a	resident	individual taxpayer ’ s Maine income	 tax	 obligation,	 we	 first	 determine	 what	 that tax obligation	is. The	process begin s with	an	identification	of the taxpayer ’ s Maine taxable net income,	which	is	the	person ’ s	reported	federal	AGI	adjusted	by	any modifications,	deductions,	 and	exemptions required	 or allowed	under	Maine law

. See 36	M.R.S.	 § § 5121 , 5122 (2017)

. The taxpayer ’ s	Maine	income	 tax obligation is	then	calculated based	on th at taxable net income

. 36 M.R.S.	§ 5121. Next, Maine	 law	 authorizes	 several	 credits against	 the	 taxable	 net	 income , 6 including	a	credit	for	income taxes paid	 to	another	jurisdictio n — the	credit at issue	in	 this	case.		36	M.R.S.	§	5217

- A. The	result of	 these	calculations is	 the ind ividual ’ s	Maine	income	tax	obligation. [¶1 7 ] S ection	 5217

- A	 is	 complicated,	 but	 not	 ambiguous. The	 plain language	of	the	statute	makes	clear (1) who	is	eligible	to	receive	the	tax	credit, (2) what	income	forms	the	basis	of	the	credit,	and (3) at	what amount	the	credit is	capped

. [¶1 8 ] A	 Maine	 resident	 taxpayer	 is	 eligible	 for	 a	 credit	 under	 section 5217

- A	if the	 taxpayer paid	income	 tax	 to a qualified	 foreign	jurisdiction	 for

6 “A	tax	credit	reduces	tax	liability	in	contrast	to	a	deduction [,] which	reduces	income	subject	to tax.” Tax	Credit ,	West's	Tax	Law	Dictionary	§	T330 ,	Westlaw	(March	2018)

.10 income “ derived	from	sources	in	that taxing jurisdiction. ” A	qualified	foreign jurisdiction	 includes	 “a	 political	 subdivision	 of	 a	 foreign	 country	 that	 is analogous	to	a	state of	the	United	States.” 36	M.R.S.	§	5217

- A. In	this	case,	the qualified	foreign	jurisdiction	is	Rogaland,	Norway, as neither	party	dispu tes. [¶1 9 ] In	 order	 to	 receive	 a	 credit	 for	 income	 tax	 paid	 to	 a	 qualified foreign	jurisdiction,	 the	 foreign	income	 on	which	 the	 tax	was	based	must	be “subject	 to	 tax” in	Maine. Section	5217

- A assumes that	 the	qualified	 foreign jurisdiction	calculates taxable	income	using	AGI	with	a	provision	analogous	to
36	M.R.S. § 5142

. 7 If a qualified	foreign	jurisdiction	define s taxable	income in some	 other	manner,	 any taxpayer	 seeking	 a	 credit	 under	 section	 5217

- A for taxes	paid	 to	 that	 foreign	jurisdiction must	recalculate his foreign	income	by

“ adjusting ” that	income	for	any	deductions	or	expenses	provided	for	in	Maine law. See 36	M.R.S.	§	5142. This adjustment	e nsures	that the	credit	reflects	taxes paid	only	on the	portion	of	the	income earned	in	the	for eign	jurisdiction that would	 be	 taxable if	 it	 had	 been	 earned in	 Maine

. S ection 5217

- A	 does	 not permit	taxpayers	to	claim	a	tax	credit for	tax	paid	on	income	that	is	not	subject to	taxation	in	the S tate	of	Maine (i.e. , the	expenses	and	deductions “removed”

7 Section	5217

- A	provides,	“ I n determining	whether	income	is	derived	from	sources	in	another jurisdiction,	the	assessor	may	not	employ	the	law	of	the	other	jurisdiction	but	shall	instead	assume that	a	statute	equivalent	to	section	5214	applies	in	that	jurisdiction.”11 from the	taxpayer ’ s gross	income )

. In	essence,	taxpayers	seeking	tax	credits	for income	 taxes	 paid	 to	 foreign	 jurisdictions	 that	 define	 taxable	 income	 as something	other	than	adjusted	gross	income	must calculate	their “ foreign	AGI ” before	they	c an	properly	calculate	the	maximum	credit	available	to	them	under section	5217

- A. [¶ 20 ] The	 maximum	 credit	 allowed	 under	 section	 5217

- A may	 not exceed	 “the	 proportion	 of	 the	 tax	 otherwise	due	under	 this	Part	 .	 .	 .	 that	 the amount	of	the	taxpayer ’ s	Maine adjusted	gross	income	derived	from	sources	in that	 taxing	 jurisdiction	 bears	 to	 the	 taxpayer ’ s	 entire	 Maine	 adjusted	 gross income.” The	 language	 is	 complicated , but the	 application	 is

— for	 taxes

— relatively simple	in	practice. First, a taxpayer	must	calcul ate	what	perc entage of his	or	her total	Maine	AGI	is	derived	 from	sources	in	 the	qualified	 foreign jurisdiction. To	 explain	 how	 to	 perform	 the	 necessary	 calculations,	 MRS provides	 taxpayers	 with	 a	 worksheet.	 	 The	 worksheet	 contains	 both instructions	and	a	box	with	a	space	for	actual	calculations.		At	line	one	of	the box,	a	taxpayer	is	to	record	his	or	her	Maine	AGI, which	includes all income

— foreign	and	in

- state

— reduced	by	any	applicable	deductions	and	modifications provided	by	Maine	law .		At	line	two,	the	taxpayer	records	the	income	earned	in the	foreign	taxing	jurisdiction.		The	instructions	accompanying	the	workshe et12 make	clear	that,	in	recording	the	foreign	income,	the	taxpayer	must	record	the foreign AGI .		The	instructions	state that the	income	included	in	line	two	“must be	 determined	 in	 the	 same	 way	 that	 a	 Maine	 nonresident	 calculates
Maine

- source	 income” and tha t “[i]ncome	 considered	 taxed	 by	 another jurisdiction	 is	 income,	 after	 deductions,	 that	 is	 analogous	 to	 Maine	 adjusted gross	 income	 (federal	 adjusted	 gross	 income	 plus	 or	 minus	 income modifications).” 8 [¶ 2 1] Lines	three	and	four	of	the	worksheet	guide	ta xpayers	through	the calculations	 necessary	 to	 determine	 the	 proportional	 cap	 on	 the	 credit	 for foreign	income	tax	paid. The	resulting	percentage	is	the maximum	percentage of	the	taxpayer ’ s	overall	Maine	tax	liability	that	may	be	satisfied	using	a	section 5217

- A	credit.		For	example,	if	a	taxpayer ’ s	foreign	AGI	represents	seventy

- five percent	of	his	total	Maine	AGI,	he	may	claim	a	credit	under	this	section	in	an amount	 up	 to	 seventy
- five	 percent	 of	 his	 overall	 Maine	 tax	 liability,	 and	 no

more. In	its entirety,	the	worksheet	reflects	the	complexities	of	section	5217

- A, but	 it	 does	 not	 contradict	 the	 statute,	 nor	 is	 it	 susceptible	 to	 multiple interpretations.

8 Moreover,	the	w orksheet	specifically	cites	to	section	5142.13 [¶ 22 ] In	 this	 case,	 t he	Warnquists	 miscalculated	 their section 5217

- A credit	 because	 they	 fai led	 to	 account	 for	 the	 differences	 in	 the	 Maine	 and Rogaland tax	 systems

. W hen	using	 the	worksheet, they	 did	 not record the ir
income from	 the	 Rogaland	 properties	 according	 to	 the	 definition of	 AGI provided	in	36	M.R.S.	§	5 142

. 9 T he	Warnquists ’ failure	to	properly	account	for the	expenses attributable	 to the	properties in	 the	calculation	 of	 their	 foreign
AGI resulted	in	a	credit	 that exceeded	 their	Maine	 tax	liability	on	 the	income derived	 from Rogaland and effectively shielded	 them	 from tax liability	 on
income that was never	subject	to	tax	in	Rogaland

— i.e. , the	interest, dividends, and	 pensions they	 received	 while	 they	 were Maine residents and that	 was included	in	their	Maine	AGI. [¶ 23 ] T he court recognized	 th e	 Warnquists ’ error and correctly concluded	that	section	5217

- A	may	not	be	used	to	shiel d	income	sourced	to	the
S tate	 of	 Maine	 using	 untaxed	 portions	 of	 foreign	 revenue .	 	 Allowing	 the Warnquists	 the	benefit	of	 the	credits	 they	claimed	would	result	in an	absurd and	 illogical taxat ion	 scheme that	 the	 Legislature	 did	 not	 intend. See Eagle

9 As	 discussed	 above, see	 supra at ¶	 19 ,	 section	 5217

- A	 presumes	 that	 every	 foreign	 taxing jurisdiction	has	a	provision	identical	to	section	5142	through	which	it	calculates	the	taxable	income of	nonresidents using	the	taxpayer’s	AGI.		Therefore,	although	the	Warnquists	are	residents	of	Maine, section	 5142	 is	 specifically	 applicable	 to	 their	 Norwegian	 income	 through	 section	 5217

- A. See 36 M.R.S.	§§	5142,	5217

- A.14 Rental ,	Inc. v.	State	Tax	Assessor ,	2013	ME	48,	¶	11,	65	A.3d	1278

. The	court properly	upheld	the	decision	limiting	t he	credit	available	under section 5217

- A
to the	tax that otherwise would	be	due on	the	same	income	in	Maine,	calculated

a fter	deductions	for	expenses. See 36	M.R.S.	§ § 51 42,	5217

- A

. B. Abatement	of	Penalties and I nterest [¶ 24 ] The	 Warnquists also argue	 that	 the	 Superior	 Court	 erred	 by declining	to waiv e or	abat e the	penalties and	interest assessed	against	them	for the	 2012	 and	 2013	 tax	 years. See 36	 M.R.S.	 §§	 186,	 187

- B. We	 disagree. Reviewing	the	record	before	us	de	novo,	we	can	identify	no	basis	on	which	to abate	 or	 reduce	 the	 penalties	 and	interest. See	 V ictor	 Bravo Aviation,	 LLC	 v.
State	Tax	Assessor ,	2011	ME	50,	¶	24,	17	A.3d	1237. The	Warnquists	have	failed to	demonstrate	that	they	relied	on	erroneous	information	provided	to	them	by MRS	or	that	there	is	substantial	authority	for	their	alternative	interpretation	of section	5217

- A. See 36	M.R.S.	§§	186,	187

- B; see	also John Swenson	Granite,	Inc.
v.	State	Tax	Assessor ,	685	A.2d	425,	429	(Me.	1996)

. The	worksheets that the Warnquists	 used	 to	 calculate	 their	 taxes	 accurately	 reflected	 the	 limits	 of section	5217

- A by	c learly	defining	the amount	of	the	foreign income tax	paid15 for	which	taxpayer s may	a	receive	credit. 10 Moreover,	this	is	not	the	first	time the	Warnquists	miscalculated	 their	 credit under	 this section .	 	 They received notice	 of	 their	 repeated	 errors and	 were	 given	 instructions	 by	 the	 Assessor regarding	 the	 proper	 calculation	 of	 the	 credit	in	 prior	 years.	 	 Therefore,	 the Superior	Court	did	not	err	in	its	decision	 to	uphold	in	 full	 the	assessment	 of penalties	and	interest	against	the W arnquists.		See	36 M.R.S.	§§ 186,	187

- B(7).
T he	entry	is: Judgment	affirmed.

Gregory	 J.	 Orso,	 Esq. (orally) ,	 Orso	 Law,	 P.A.,	 York,	 for	 appellant Eric	 V. and Rosamond	C.	Warnquist Janet	T.	Mills,	Attorney	General,	and	Kimberly	L.	Patwardhan,	Asst.	Atty.	Gen. (orally) ,	Office	of	the	Attorney	General,	Augusta,	for	app ellee	State	Tax	Assessor

York	County S uperior	Court	docket	number	AP

- 2016

- 39 F OR C LERK R EFERENCE O NLY

10 Specifically,	the	worksheets	instructed	taxp ayers	regarding	the	proportionality	language	of	the statute	and	clearly	defined	the foreign income tax	paid for	which	a	taxpayer	may	receive	a	credit. See supra at ¶¶ 2 0

- 2 1

.