An Act To Provide an Income Tax Modification for the Empowerment Zone Employment Credit
Maine Legislature, Session 121, LD 1664
Committee: Taxation
Sponsors: STANLEY, CARR, CHURCHILL, COLLINS, DAVIS, PENDLETON, ROTUNDO
Amends: 36 MRSA §5122

Legislative Document 
No. 1664 
H.P.1240 
House of Representatives, December 16, 2003 
An Act To Provide an Income Tax Modification for the 
Empowerment Zone Employment Credit 
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
203. 
Received by the Clerk of the House on December 16, 2003. Referred to the Committee on 
Taxation pursuant to Joint Rule 308.2 and ordered printed pursuant to Joint Rule 401. 
.,\'. 
Presented by Representati ve SHERMAN of Hodgdon. 
Cosponsored by Senator STANLEY of Penobscot and 
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MILLICENT M. MacFARLAND 
Clerk 
Representati ves: BRYANT -DESCHENES of Turner, CARR of Lincoln, CHURCHILL of 
Washburn, COLLINS of Wells, DAVIS of Falmouth, Senators: PENDLETON of Cumberland, 
ROTUNDO of Androscoggin. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 36 MRSA §5122, sub-§2, lIQ, as corrected by RR 2003, c. 
1, §38, is amended to read: 
Q. 
A fraction of any amount previously added back by the 
taxpayer 
to 
federal 
adjusted 
gross 
income 
pursuant 
to 
subsection 1, paragraph N. 
(1) 
With respect to property first placed in service 
during taxable years beginning in 2002, the adjustment 
under this paragraph is available for each year during 
the 
recovery 
period, 
beginning 
years 
after 
the 
beginning of the taxable year during which the property 
was first placed in service. 
The fraction is equal to 
the amount added back under subsection 1, paragraph N 
with respect to the property, divided by the number of 
years in the recovery period minus 2. 
(2) 
With 
respect 
to 
all 
other 
property, 
for 
the 
taxable year 
immediately following 
the taxable year 
during which the property was first placed in service, 
the fraction allowed by this paragraph is equal to 
SOb 
of the amount added back under subsection 1, paragraph 
N with respect to the property. 
For each subsequent 
taxable year during the recovery period, the fraction 
is 
equal 
to 
95% 
of 
the 
amount 
added 
back 
under 
subsection 1, paragraph N with respect to the property, 
divided by the number of years in the recovery period 
minus 2. 
In the case of property expensed pursuant to Section 179 of 
the Code, 
the term "recovery period" means 
the recovery 
period that would have been applicable to the property had 
Section 179 not been applied; aBa 
Sec. 2. 36 MRSA §5122, sub-§2, lIT, as reallocated by RR 2003, 
c. 1, §37, is amended to read: 
T. 
For income tax years beginning on or after January l, 
2002, 
an 
amount 
equal 
to 
the total 
premiums 
spent 
for 
long-term 
care 
insurance 
policies 
certified under 
Title 
24-A, 
section 5075-A as long as the amount subtracted is 
reduced 
by 
the 
long-term 
care 
premiums 
claimed 
as 
an 
itemized deduction pursuant to section 5125T; and 
Sec. 3. 36 MRS A §5122, sub-§2, lIU is enacted to read: 
Page l-LR2331(1) 
U. 
An amount egual to the taxpayer' s federal empowerment 
zone employment credit as determined under the laws of the 
United States. 
Sec. 4. Application. 
This Act applies to tax years beginning 
on or after January 1, 2005. 
SUMMARY 
Current law allows a business to deduct from its income for 
Maine 
income 
tax 
purposes 
an 
amount 
equal 
to 
the 
business' 
federal new jobs credit or work opportunity credit. 
This bill 
allows a business also to deduct any amount received under the 
federal 
empowerment 
zone 
employment 
credit 
program, 
vlhich 
provides tax incentives to businesses who hire employees who live 
and work in federally designated "empowerment zones."