An Act To Amend the Laws Governing the Deduction of Pensions, Retirement Benefits and Other Income from State Income Tax LR0251 (02)
Maine Legislature, Session 121, LD 0583
Committee Amendment CA_A_H534 (House)
Amends: 36 MRSA §1760

COMMITTEE AMENDMENT "LJ. to H.P. 446, L.D. 583, 
Act 
To 
Amend 
the 
Laws 
~t~rning the Deduction of 
Retirement Benefits and other Income from State Income 
Bill, "An 
Pensions, 
Tax" 
Amend the bill by inserting after the enacting clause and 
before section 1 the following: 
'Sec. I. 36 MRSA §1760, sub-§46, as amended by PL 1993, c. 
670, §3, is repealed and the following enacted in its place: 
46. 
Medical 
patients 
and 
their 
families. 
Sales 
to 
incorporated nonprofit organizations providing: 
A. 
Temporary 
residential 
accommodations 
to 
pediatric 
patients suffering from critical illness or disease such as 
cancer or who are accident victims. to adult patients with 
cancer or to the families of the patients; or 
B. 
Temporary residential accommodations or food to hospital 
patients or to the families of hospital patients.' 
Further amend the bill in section 1 in paragraph M in the 
first line 
(page 
1, 
line 
in L.D.) 
by 
striking out 
the 
following: 
"taxpayer" and inserting in its place the following: 
'individual' 
Further amend the bill in section I in paragraph M in the 
5th line (page 1, line 10 in L.D.) by striking out the following: 
"taxable in this State" 
COMMITTEE AMENDMENT 
tf:r:' 
~ 
COMMITTEE AMENDMENT 
to H.P. 446, L.D. 583 
Further amend the bill in section 1 in paragraph M in 
subparagraph (1 ) in the blocked paragraph in the first line (page 
1, 
line 
in 
L.D. ) 
by 
inserting 
after 
the 
following: 
"bgginning" the following: 
'on or gftgr' 
Further amend the bill in section 1 in paragraph M by 
striking out all of subparagraph (2) (page 2, lines 4 to 11 in 
L.D.) and inserting in its place the following: 
. (2) 
~ae For gn individugl who is 65 yegrs of age or 
older 
on 
the 
last 
dgy 
of 
thg 
taxable 
year, 
the 
aggregate of intergst, dividends, net capitgl gains and 
pension benefits 
received 
ay--~ae--p~ima~y--~eeipieB~ 
under employee retirement plans and included in the 
individugl's federal adjusted gross income modifigd gS 
otherwise provided by this section. 
Items of intgrgst, 
dividends and net capitgl ggins incomg 
from jointly 
owned gccounts must be gpportioned equglly among owners 
of the gccounts.' 
Further amend the bill in section 1 
in paragraph M by 
striking out all of the last blocked paragraph (page 2, lines 13 
to 30 in L.D.) and inserting in its place the following: 
'For purposes of this paragraph, "primgry recipignt" means 
the individual upon whosg ggrnings thg employge retirgment 
plan benefits are bgsgd or the surviving spousg of that 
individugl gnd "employee retirement plan" means 
a state, 
federal or military retirement plan or any other retirement 
benefit plan established and maintained by an employer for 
the benefit of its employees under the Code, Section 401(a), 
Section 403 or Section 457(b) 
e~--~ae-~Qe, excgpt that 
distributions mgdg pursugnt to a Section 457{b} plgn grg not 
gligible for the dgduction providgd by this pgrggrgph if 
they gre madg prior to 55 years of ggg and arg not part of a 
sgries of substgntially equal pgriodic pgymgnts mgde for the 
life of the primgry rgcipignt or the joint livgs of the 
primgry recipignt gnd the primgry recipient's designated 
beneficiary. 
"Employee retirement plan" 
Qee&--not,...-iR€~\:l.Qe 
includgs an individual retirement account under Section 408 
of the Code, a Roth IRA under Section 408A of the Code, a 
rollover 
individual 
retirement 
account, 
a 
simplified 
employee pension under Section 408(k) of the Code or an 
ineligible deferred compensation plan under Section 457 (f) 
of the Code. 
Benefits under an employge retirement plan do 
not 
includg distributions 
thgt 
are subject 
to 
the 
tax 
imposed by the Code, Section 72{t). 
FeF--p1:H'-pe-&e£--G-f--~ais 
pal:'a<3£apli?---!!mili~a~y 
"Military 
retirement 
plan" 
means 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT ,~, to H.P, 446, L.D. 583 
benefits received as a result of service in the active or 
reserve components of the Army, Navy, Air Force, Marines or 
Coast Guard;' 
Further amend the bill by inserting after section 1 the 
following: 
, Sec. 
2. 
Appropriations 
and 
allocations. 
The 
following 
appropriations and allocations are made. 
ADMIHISTRATIVE AND FINANCIAL SERVICES, DEPAR"l"MENT OF 
Maine Revenue Services 
Ini tiati ve: 
Provides funds for one Tax Examiner position and 
related costs as 
a 
result of the increase in the number of 
taxpayers who are eligible to claim the pension deduction. 
General Fund 
Positions - Legislative Count 
Personal Services 
All Other 
General Fund Total 
2003-04 
(1. 000) 
$21, 451 
$6,955 
$28,406 
2004-05 
(1. 000) 
$45,534 
$3,755 
$49,289' 
Further amend the bill in section 2 in the first line (page 
2, line 32 in L.D.) by striking out the following: 
This Act and 
inserting in its place the following: 
'That portion of this Act 
that amends the Maine Revised Statutes, Title 36, section 5122, 
subsection 2, paragraph M' 
Further amend the bill by relettering 
nonconsecutive 
Part 
letter 
or 
section 
consecutively. 
SUMMARY 
or renumbering any 
number 
to 
read 
This amendment makes technical corrections to accomplish the 
intent 
of 
the 
bill 
and 
to 
avoid 
a 
conflict 
with 
other 
legislation. 
It also adds a sales tax exemption for sales to 
nonprofit organizations providing food or lodging to hospital 
patients or 
their 
families. 
It also 
adds 
an 
appropriation 
section to the bill. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Net Cost (Savings) 
General Fund· 
Appropriations/Allocations 
General Fund 
Revenue 
General Fund 
Other Special Revenue Funds 
Fiscal Detail and Notes 
Approved: 05/27/03 ;::!:Pac:.. 
12lst Maine Legislature 
Office of Fiscal and Program Review 
LD583 
An Act To Amend the Laws Governing the Deduction of Pensions, 
Retirement Benefits and Other Income from State Income Tax 
LR0251 (02) 
Fiscal Note for Bill as Amended by Committee Amendment" " 
Committee: Taxation 
Fiscal Note Required: Yes 
Fiscal Note 
2003-04 
$12-,365,406 
$28,406 
($12,337,000) 
($663,000) 
2004-05 
$14,284,289 
$49,289 
($14,235,000) 
($765,000) 
Projections 
2005-06 
$16,167,753 
$51,753 
($16,116,000) 
($884,000) 
Projections 
2006-07 
$17,118,341 
$54,34. 
($17,064,000) 
($936,000) 
The revenue amounts above reflect the loss of income tax revenue that results from increasing the maximum allowable 
deduction for pension income. The Other Special Revenue shown is the reduction in money transferred to the Local 
Government Fund for state-municipal revenue sharing attributable to the lower tax collections. The amended bill also 
expands a sales and use tax exemption to certain nonprofit organizations. The decrease in sales and use tax 
collections is expected to be minor. 
This bill includes a General Fund appropriation of $28,406 in fiscal year 2003-04 and $49,289 in fiscal year 2004-05 
for Maine Revenue Services for the administrative costs associated with the increase in the pension deduction.