An Act Concerning Technical Changes to the Tax Laws
Maine Legislature, Session 121, LD 1571
Committee: Taxation
Sponsors: STANLEY, LEMOINE, STRIMLING, McGOWAN
Amends: 36 MRSA §191, 36 MRSA §1752, 36 MRSA §1754-A, 36 MRSA §1814, 36 MRSA §2902, 36 MRSA §2909, 36 MRSA §3203, 36 MRSA §3215, 36 MRSA §3219-A, 36 MRSA §3235, 36 MRSA §4070, 36 MRSA §4071, 36 MRSA §4641, 36 MRSA §4641-D, 36 MRSA §4641-E, 36 MRSA §4831, 36 MRSA §4832, 36 MRSA §4833, 36 MRSA §5121, 36 MRSA §5122, 36 MRSA §5142, 36 MRSA §5160, 36 MRSA §5163, 36 MRSA §5175, 36 MRSA §5200-A, 36 MRSA §5217-A, 36 MRSA §5218, 36 MRSA §5219-A, 36 MRSA §5219-N, 36 MRSA §5231, 36 MRSA §5316, 36 MRSA §6652

Legislative Document 
No. IS7I 
S.P.530 
In Senate, April 14, 2003 
An Act Concerning Technical Changes to the Tax Laws 
Submitted by the Department of Administrative and Financial Services pursuant to Joint 
Rule 204. 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Senator STANLEY of Penobscot. 
Cosponsored by Representative LEMOINE of Old Orchard Beach and 
JOY J. O'BRIEN 
Secretary of the Senate 
Senator: STRIMLING of Cumberland, Representative: McGOWAN of Pittsfield. 
Printed on recycled paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. I. 36 MRSA §I45 is enacted to read: 
§145. 
Protective claim for refund 
1. 
Right to file protective claim. 
A person who has paid 
any tax imposed by this Title or administered by the State Tax 
Assessor may file a protective claim for refund. 
As used in this 
section. "protective claim for refund" means a refund claim filed 
in order to protect the taxpayer's potential right to a refund of 
tax in the event that a 
related contingency occurs after the 
expiration of the period otherwise provided by this Title for 
filing a refund claim for the tax and period in question. 
The 
protective claim for refund must be filed with the assessor in 
writing before the expiration of the otherwise applicable statute 
of limitations. 
The provisions of this section apply only to 
that portion of 
a 
refund claim that is dependent 
upon 
the 
occurrence of the related contingency. 
2. 
Claim may be held open. 
At 
the discretion of the 
assessor, 
a 
protective claim for refund may be held without 
decision until the expiration of 4 years from the filing of the 
protective claim for 
refund or 
until the occurrence of 
the 
related contingency, whichever is earlier. 
The decision of the 
assessor not 
to hold 
a 
protective claim for 
refund without 
decision is not subject to review under section 151. 
While a 
protective claim for refund is being held without decision, the 
assessor may at any time require from the claimant additional 
information about the related contingency or evidence in support 
of continuing to hold the protective claim for refund open. 
3. 
T~ayer to file final claim. 
A final claim for refund 
must be filed within the earlier of the following dates: 
A. 
Ninety 
days 
from 
the 
occurrence 
of 
the 
related 
contingency; 
B. 
Ninety days from the taxpayer's receipt of notice of 
denial of the protective claim for refund: or 
C. 
Four years from the date of the filing of the protective 
claim for refund. 
If the related contingency is 
a 
ruling by an administrative 
agency or court, the ruling has occurred for purposes of this 
section 
only 
when 
the 
taxpayer 
has 
no 
further 
right 
to 
administrative or judicial review of that ruling. 
The final 
claim for refund must be filed with the assessor in writing and 
must state the specific grounds upon which it is founded. 
If the 
Page l-LR1977(1) 
assessor denies the final claim for refund in whole or in part, 
the taxpayer may request reconsideration of the denial pursuant 
to section 151. 
For 
purposes 
of determining the 
amount of 
interest to be paid on any balance refunded to the taxpayer, the 
final claim for refund is considered to be the return listing the 
overpayment. 
Sec. 2. 36 MRSA §lSl, first" as amended by PL 2001, c. 583, 
§l, is further amended to read: 
Any person who is subject to an assessment by the State Tax 
Assessor or entitled by law to receive notice of a determination 
of the assessor and who is aggrieved as a result of that action 
may request in writing, within 30 days after receipt of notice of 
the 
assessment 
or 
the 
determination, 
reconsideration 
by 
the 
assessor of the assessment or the determination. 
If a person 
receives notice of an assessment and does not file a request for 
reconsideration within 
t:he--spe-c-i..f-i~--&ifAe..-pe!':iea 30 days after 
receipt of notice, the assessor may not reconsider the assessment 
pursuant to this section and no review is available in Superior 
Court 
regardless 
of 
whether 
the 
taxpayer 
subsequently 
makes 
payment and requests a refund. 
If a person receives notice of a 
denial of refund and does not file a request for reconsideration 
within 30 days after receipt of notice, the denial of refund 
constitutes final agency action for which no review is available 
in Superior CourL and the person may not submit a subsequent 
claim for the same refund. 
Sec. 3. 36 MRSA §191, sub-§2, ,R, as repealed and replaced by 
PL 1995, c. 625, Pt. A, §47, is amended to read: 
R. 
The disclosure to the Department of Human Services, 
Bureau of Medical Services of information relating to the 
administration and collection of the tax imposed by chapter 
and chapter 375: 
Sec. 4. 36 MRSA §191, sub-§2,~, as 
~ended by PL 2001, c. 
714, Pt. ee, §2 and affected by §8, is further amended to read: 
R. 
The disclosure to the Department of Human Services or 
the Department of Behavioral and Developmental Services of 
information relating to the administration and collection of 
the tax imposed by chapter 373 and chapter 375: 
Sec. 5. 36 MRSA §191, sub-§2, 1fY, as amended by PL 2001, c. 
439, Pt. L, §7, is further amended to read: 
Y. 
The disclosure by the State Tax 
in writing of any individual against 
been made pursuant to section 177, 
following information: 
Assessor, upon request 
whom an assessment has 
subsection 1, of the 
(1) 
Information regarding the underlying tax liability 
to the extent necessary to apprise the individual of 
the basis of the assessment; 
(2) 
The name of any other individual against whom an 
assessment has been made for the same underlying tax 
debt; and 
(3) 
The general nature of any steps taken by the 
assessor to collect the underlying tax debt from any 
other individuals and the amount collected; aBa 
Sec. 6. 36 MRSA §191, sub-§2, 1rZ, as enacted by PL 2001, c. 
439, Pt. L, §8, is amended to read: 
z. 
The disclosure to the Treasurer of State when necessary 
for the performance of the Treasurer of State I s official 
duties as administrator under Title 33, chapter 41 of the 
following information: 
(1) 
The current mailing address for a taxpayer for 
purposes of returning unclaimed or abandoned property 
to the rightful owner or heir; and 
(2) 
The 
names 
and mailing addresses 
of all 
Maine 
corporate income tax filers in an electronic medium 
prescribed by the State Tax AssessorTL 
Sec. 7. 36 MRSA §191, sub-§2, 1r1rAA and BB are enacted to read: 
AA. 
The disclosure by employees of the bureau to designated 
representatives 
of 
the 
Finance 
Authority 
of 
Maine 
of 
information required to ensure that recipients of certain 
benefits under Title 20-A, chapter 417-E are eligible to 
receive such benefits; and 
BB. 
The disclosure to an authorized representative of the 
Department of Human Services, Office of Head Start and Child 
Care 
of 
taxpayer 
information 
directly 
relating 
to 
the 
certification of investments eligible for or the eligibility 
of a taxpayer for the quality child care investment credit 
provided by section 5219-0. 
Sec. 8. 36 MRSA §1752, sub-§9 is repealed. 
Sec. 9. 36 MRSA §1752, sub-§ll, 1rB, as repealed and replaced 
by PL 1999, c. 708, §23, is amended to read: 
B. 
"Retail sale" does not include: 
(1) 
Any casual sale; 
(2) 
Any 
sale by 
a 
personal representative in the 
settlement of 
an estate, 
unless 
the 
sale is made 
through a retailer, or unless the sale is made in the 
continuation or operation of a business; 
(3) 
The sale, to a person engaged in the business of 
renting automobiles, of automobiles, integral parts of 
automobiles or accessories to automobiles, for rental 
or for use in an automobile rented on a 
short-term 
basis; 
(4) 
The sale, to a person engaged in the business of 
renting audio or video t:apes media and audio or video 
equipment, of audio or video tapes media or audio or 
video equipment for rental; 
(5) 
The sale, to a person engaged in the business of 
renting or 
leasing automobiles, 
of 
automobiles 
for 
rental or lease for one year or more; 
(6) 
The sale, to a person engaged in the business of 
providing cable television services, of cable converter 
boxes and remote-control units for rental or lease; or 
(7) 
The sale, to a person engaged in the business of 
renting furniture, of furniture for rental. 
Sec. 10. 36 MRSA §1752, sub-§17-A, 11K, as amended by PL 2001, 
c. 396, §22, is further amended to read: 
K. 
Rental 
of 
furniture, 
audio 
t:apes 
media 
and 
audio 
equipment pursuant to a rental-purchase agreement as defined 
in Title 9-A, section 11-105. 
Sec. 11. 36 MRSA §1754-A, as enacted by PL 1991, c. 780, Pt. 
cee, §2, is amended to read: 
§1154-A. Registration of owners of space temporarily 
rented as retail space 
A person who rents or leases pF9~eFt;y-aae-Ras space to more 
than 4 persons FeBt:iB~-~--~~-s~aee at one location for less 
than a 12-month period for the purpose of retail sales shall 
register with the State Tax Assessor. 
The form for application 
for 
registration 
and 
the 
registration 
certificates 
must 
be 
prescribed and furnished free of charge by the St:at:e-TaH-Assess9F 
assessor. 
For each location where more than 4 persons rent or 
lease space for less than 12 months from the same person, the 
~tate---~--Asses6eF 
assessor 
shall 
issue 
a 
registration 
certificate, 
which 
must 
be 
conspicuously 
displayed 
at 
that 
cat i on . 
~he - pe-F-s-en--sha-1-1- -p-F-G-V'-ide- - the - -S-t.-a-t.-e- -.;r"-aif- -A-s-s-e-s-SG-F- -By !l.y 
the 15th of each month following any month in which rental or 
lease activity has occurred, 
the person shall provide to the 
assessor 
the 
names, 
addresses 
and 
sales 
tax 
registration 
certificate numbers of those persons who have rented space during 
the previous month. 
;I:BfeFlRatieBal Information returns must be 
prescribed and furnished free of charge by the Sta~e-~aH-A66e66eF 
assessor. 
Returns required under this section must be treated as 
returns filed under this Title and are subject to section lin 
187-B. 
Sec. 12. 36 MRSA §1814, sub-§I, as enacted by PL 1977, c. 316, 
§1, is amended to read: 
1. 
Tax liability. Whenever the tax collected by a retailer 
for any period exceeds that provided by law, whether the excess 
is attributable to the collection of tax on exempt or nontaxable 
transactions 
or 
erroneous 
computation, 
the 
total 
amount 
collected, excluding only that portion of the excess whieh that 
has been returned or credited to the person or persons from whom 
it was collected, 
sha11-eeBsti~~~e constitutes a tax liability of 
the retailer aBa-6hall that must be reported and paid at the time 
and in the manner provided by sections 1991 1951-A and 1952. 
Sec. 13. 36MRSA§1861-A, as amended by PL 2001, c. 583, §12, 
is further amended to read: 
§1861-A. Reportinq use tax on individual income tax returns 
The assessor shall provide that individuals report use tax 
on items with a purchase price of $1,000 or less on their Maine 
individual income tax returns. 
Taxpayers are required to attest 
to the amount of their use tax liability for the period of the 
tax return. 
Alternatively, they may elect to report an amount 
that is .04% of their Maine adjusted gross income. 
~he--t,a.131-e 
ame~B~-~ee-s-~--~~~-~e-~~~~it~-a-p~£€ha6e-~~~-~&-eHee66 
e~-~~~---h~a13~1-~&y-a£464R~-~~~-s~eh-~~~~~&&-be-~-~e 
~he-~aBle--ame~BtT 
Upon subsequent review, if use tax liability 
for the period of the return exceeds the amount of liability 
arising from the return, 
a credit of the amount of liability 
arising from the return is allowed subject to the limitation set 
out in this section. 
The credit is limited to the amount of 
liability arising from the return for items with a sale price of 
$1,000 or less and may be 
applied only against 
a 
liability 
determined on review with regard to items with a sale price of 
$1,000 or less. 
Use tax on any item with a purchase price of 
more than $1, 000 must be reported in accordance with section 
1951-A. 
Sec. 14. 36 MRS A §19S2, as amended by PL 1981, c. 364, §27, 
is further amended to read: 
§1952. Payment of tax 
The taxes imposed by chapters 211 to 225 
sha~~-ae on sales 
of tangible personal property and taxable services are due and 
payable at the time of the sale~-e£7-~£-~~~~~~~~a-~eB6a± 
teF--livia~--~~a£~e££--~--~~~--~-~~~~--~~~--9a--a 
6heF6-6eFffi-~~-~-~he-~~~-~he-£e£~ad--~-payaa±e. Upon such 
terms and conditions as the ~ 
Tax Assessor may prescribe, he 
the assessor may permit a postponement of payment to a date not 
later than the date wheB on which the sales so taxed are required 
to be reported. 
~eF-~a~£~-~~-S&a~-~aH-A££~£~-~-a&a~-a±± 
8F-aBy-paF6-et-6he-6aHesT 
Sec. IS. 36 MRSA §2902, sub-§4, as enacted by PL 1967, c. 94, 
§4, is repealed. 
Sec. 16. 36 MRSA §2909, as amended by PL 1965, c. 479, §1, is 
repealed and the following enacted in it place: 
§Z909. Refund of entire tax paid by certain common carriers 
A person engaged in furnishing 
common carrier passenger 
service under an operating authority license issued pursuant to 
Title 29-A, section 552 is entitled to reimbursement of the tax 
paid on internal combustion engine fuel used by that person in 
locally 
encouraged 
vehicles. 
For 
purposes 
of 
calculating 
reimbursement due pursuant to this section, internal combustion 
engine fuel used in a person's locally encouraged vehicles is 
presumed to bear the same proportional relationship to internal 
combustion engine fuel used in all of the person's passenger 
vehicles that the person's commutation 
fare revenue derived from 
service provided by locally encouraged vehicles bears to the 
person's 
total 
passenger 
fare 
revenue. 
"Commutation 
fare 
revenue" means revenue attributable to fares of 60¢ or less and 
fares paid for commutation or season tickets for single trips of 
less than 30 miles or for commutation tickets for one month or 
less. 
"Total 
passenger 
fare 
revenue" 
means 
all 
revenue 
attr ibutable to the claimant's passenger operations. 
"Locally 
encouraged vehicles" means buses upon which no excise tax is 
collected under section 1483, subsection 13. 
Applications for refunds must be filed with the State Tax 
Assessor, on a form prescribed by the assessor and accompanied by 
the original invoices showing those purchases, within 9 months 
from the date of purchase. 
A refund may not be issued under this 
section unless the claimant's commutation fare revenue derived 
during the calendar guarter for which the refund is claimed is at 
least 60% of the claimant's total passenger fare revenue derived 
during that calendar guarter. 
Sec. 17. 36 MRSA §3203·C, as enacted by PL 2001, c. 688, §7, 
is amended to read: 
§3203-C. Inventory tax 
On the date that any increase in the rate of tax imposed 
under this chapter takes effect, an inventory tax is imposed upon 
all distillates that are held in inventory by 
a 
ais~FiaH~eF 
supplier or retail dealer as of the end of the day prior to that 
date on which the tax imposed by section 3203, subsection 1 has 
been paid. 
The inventory tax is computed by multiplying the 
number of gallons of tax-paid fuel held in inventory by the 
difference between the tax rate already paid and the new tax 
rate. 
I)is~FiaH~eFs Suppliers and retail dealers that hold such 
tax-paid inventory shall make payment of the inventory tax on or 
before the 15th day of the next calendar month, accompanied by a 
form prescribed and furnished by the State Tax Assessor. 
In the 
event of a decrease in the tax rate, the aistFiaHteF supplier or 
retail dealer is entitled to a refund or credit, which must be 
claimed on a form designed and furnished by the assessor. 
Sec. 18. 36 MRSA §3215, as amended by PL 1985, c. 127, §l, is 
repealed and the following enacted in its place: 
§3215. Refund of taxes for certain common carriers 
A person engaged in furnishing 
common 
carrier passenger 
service under an operating authority license issued pursuant to 
Title 29-A, section 552 is entitled to reimbursement of the tax 
paid on special fuel used by that person in locally encouraged 
vehicles. 
For purposes of calculating reimbursement due pursuant 
to 
this 
section, 
special 
fuel 
used 
in 
a 
person's 
locally 
encouraged vehicles is presumed to bear the same proportional 
relationship 
to 
special 
fuel 
used 
in all 
of 
the 
person's 
passenger vehicles that the person's commutation fare 
revenue 
derived 
from service provided by locally encouraged vehicles 
bears to the person's total passenger fare revenue. 
"Commutation 
fare revenue" means revenue attributable to fares of 60¢ or less 
and fares paid for commutation or season tickets for single trips 
of less than 30 miles or for commutation tickets for one month or 
less. 
"Total 
passenger 
fare 
revenue" 
means 
all 
revenue 
attributable to the claimant's passenger operations. 
"Locally 
encouraged vehicles" means buses upon which no excise tax is 
collected under section 1483, subsection 13. 
Applications for refunds must be filed with the State Tax 
Assessor, on a form prescribed by the assessor and accompanied by 
the original invoices showing those purchases, within 9 months 
from the date of purchase. 
A refund may not be issued under this 
section unless the claimant's commutation fare revenue derived 
during the calendar guarter for which the refund is claimed is at 
least 60% of the claimant's total passenger fare revenue derived 
during that calendar guarter. 
Sec. 19. 36 MRS A §3218, as amended by PL 1985, c. 127, §1, is 
repealed and the following enacted in its place: 
§3218. Refund of tax in certain cases, time limit 
A person who purchases and uses special fuel for any use 
other 
than operation of 
a 
registered motor 
vehicle 
on 
the 
highways of this State, and who has paid the tax imposed by this 
chapter on that fuel, is entitled to reimbursement in the amount 
of the tax paid, less 1t, upon presenting to the State Tax 
Assessor a sworn statement accompanied by the original invoices 
or other evidence as the assessor may reguire. 
The statement 
must show the total amount of special fuel so purchased and used 
by that person other than in the operation of registered motor 
vehicles on the highways of this State and in the operation of 
aircraft. 
Applications 
for 
refunds 
must 
be 
filed with 
the 
assessor within 15 months from the date of purchase. 
A monthly refund application on a 
form prescribed by the 
assessor may be filed at the close of any month to claim a refund 
pursuant to this section. 
Interest must be paid at the rate 
determined pursuant to section 186, calculated from the date of 
receipt of the monthly claim, for all proper claims not paid 
within 30 days of receipt. 
Nothing in this paragraph may be 
construed to relieve the applicant from filing guarterly reports 
as prescribed in section 3209. 
All fuel gualifying for 
a 
refund under this section is 
subject to the use tax imposed by chapter 215. 
Sec. 20. 36 MRSA §3219-A, sub-§I, ,C, as enacted by PL 1995, 
c. 271, §11, is amended to read: 
C. 
Inspect the books and records of any supplier, user, 
dis~~i9a~a~ retailer or importer; 
Sec. 21. 36 MRSA §3235, as amended by PL 1999, c. 414, § 32 , 
is further amended to read: 
§3235. Tax a debt; recovery; preference 
The taxes, interest and penalties imposed by chapters 7, 
451T-~~~ and 459, 
from the time the--same they are due, 
are 
personal 
debt 
of 
the 
supplier, 
distributor, 
importerT--mete~ 
ea~~ie~ or 
user 
to 
the State, 
recoverable 
in any 
court of 
competent jurisdiction in a civil action in the 
name of the 
State, and have preference in any distribution of the assets of 
the taxpayer, 
whether in bankruptcy, 
insolvency or otherwise. 
The proceeds of any judgment obtained must be paid to the State 
Tax Assessor. 
Sec. 22. 36 MRSA §4070, as amended by PL 1991, c. 546, §28, 
is repealed and the following enacted in its place: 
§4070. Extension of time for filing return 
1. 
General. 
The State Tax Assessor may grant a reasonable 
extension of time for filing a return required by this chapter, 
on terms and conditions the assessor may require, as long as 
payment reasonably estimating the tax due has been made on or 
before the original payment due date. 
Except as provided in 
subsection 2, an extension for filing any return may not exceed 8 
months. 
2. 
Federal extension. 
When an extension of time is granted 
within which to file a federal estate tax return, the due date 
for filing the Maine estate tax return is automatically extended 
for 
an 
equivalent 
period, 
as 
long 
as 
payment 
reasonably 
estimating the tax due has been made on or before the original 
payment due date. 
Sec. 23. 36 MRSA §4071, sub-§l, ,E, as enacted by PL 1981, c. 
451, §7, is amended to read: 
E. 
The amount of the federal credi t 
~e~--6-t-a-t-e--de-a-t-h--taHes 
allewaBle-te-the-QeeeQeHt~6-e6tate. 
Sec. 24. 36 MRSA §4641, sub-§l-A, "A and B, as enacted by PL 
2001, c. 559, Pt. I, §1 and affected by §15, are amended to read: 
A. 
In the case of a 
corporation, "controlling interest" 
means 
either-...fi.O%--e~ more than 50°-0 of the total combined 
voting power of all classes of stock of the corporation 
entitled to vote or 
§G~-eF more than 50% of the capital, 
profi ts or beneficial interest in the voting stock of the 
corporation. 
B. 
In the case of a 
partnership, association, trust or 
other entity, "controlling interest" means 
§G%-e~ more than 
50°-& of the capital, profits or beneficial interest in the 
partnership, association, trust or other entity. 
Sec. 25. 36 MRSA §4641-D, 2nd , from the end, as amended by 
P&SL 1975, c. 78, §21, is further amended to read: 
The register of deeds shall transmit both copies of the 
declaration of value to the State Tax Assessor not later than 40 
days from the date of recordation of the deed subject to the tax 
or« in the case of a transfer of a controlling interest subject 
to tax under this chapter« no later than the 10th day of the 
month following the month in which the report of the transfer is 
received by the register of deeds. 
Sec. 26. 36 MRSA §4641-E, 2nd" as amended by PL 2001, c. 
559, Pt. I, §11 and affected by §15, is further amended to read: 
Within 3 years of the recording of a deed subject to the tax 
imposed by this chapter or of the date on which a transfer of a 
controlling interest in an entity sUbject to taxation under this 
chapter is reported to the register of deeds, 
the State Tax 
Assessor may examine any books, papers, records or memoranda of 
the grantor or grantee bearing upon the amount of tax payable, 
and may enforce that right of examination by subpoena. If the 
assessor determines that there is a deficiency of taxes due under 
this chapter, such deficiency must be assessed, together with 
interest and penalties, with notice to the persons liable, but no 
such assessment may be made more than 3 years after the date of 
recording or transfer. 
Sec. 27. 36 MRSA §4831, sub-§§2-A and 2-B, as enacted by PL 
1989, c. 927, §3, are repealed. 
Sec. 28. 36 MRSA §4832, sub-§ 1, as amended by PL 1989, c. 927, 
§5, is further amended to read: 
1. 
Imposition. 
A fee is imposed on the retail sale in this 
State of 
new tiresT 
gnd new 
lead-acid 
batteriesT--Bew--maje~ 
aFF±iaBee6T--Bew-~~~--~it~r~-~~~--~-ba~£~~es--aBQ--BeW 
ma~~~e66e6T--~ae-'ee-i6 in the amount of $1 per tire or lead-acid 
battery 
aBQ--$~--~~-~~--~~~--~~--~~~Bi~~~e--i~em6T 
Ba~at;.a1:l6--and--ma~~~e66e6. 
AQEU·t,.i-G-Jl.a1-1:Y-r-~ee6 A fee in the same 
ameaBt;.6--a~e amount is imposed on the storage, 
use or other 
consumption in this State of tiresT gnd lead-acid batteriesT 
maje~-~~~~-~~--fQ~Bit,QFe-i~em67-~~~~-maEE~e66e6 
purchased new in this State by the user or purchased eat;.--ef 
outside the State by the user unless 
eiEhe~--ef the fee6 fee 
imposed by this section has been paid. 
Sec. 29. 36 MRS A §4832, sub-§I-A, as enacted by PL 1995, c. 
368, Pt. NN, §2, is repealed. 
Sec. 30. 36 MRSA §4833, 2nd 1J, as amended by PL 1989, c . 927, 
§5, is repealed. 
Sec. 31. 36 MRSA §5121, as amended by PL 1995, c. 281, §26, 
is further amended to read: 
§5l2l. Maine taxable income 
The Maine taxable income of a resident individual 
e~--t.ki6 
State is equal to the individual's federal adjusted gross income 
as defined by 
~eaeFal--JaWy the Code with the modificationsy and 
less the deductions and personal exemptions provided in this 
chapter. 
Sec. 32. 36 MRSA §5122, sub-§I, 1(A, as corrected by RR 1991, 
c. 2, §136, is amended to read: 
A. 
Interest or dividends on obligations or securities of 
any 
state 
other 
than 
this 
State. 
or 
of 
a 
political 
subdivision or authority of any state other than this State 
aaa--its--pel-itieal---sHsaivisieas--aaa--aHtheFities, 
to 
the 
extent that interest or those dividends are not included in 
the recipient's federal adjusted gross income; 
Sec. 33. 36 MRSA §5122, sub-§I, 1JJ, as amended by PL 2001, c. 
559, Pt. GG, §8 and affected by §26, is further amended to read: 
J. 
The amount claimed as a 
sHsi:ae-s-s--€~flea6e deduction in 
determining federal adjusted gross income that is included 
in 
the 
investment 
credit 
base 
for 
the 
high-technology 
investment tax credit; 
Sec. 34. 36 MRSA §5122, sub-§2, 1JA, as amended by PL 2001, c. 
177, §1, is further amended to read: 
A. 
Interest or dividends 
on obligations of the United 
States 
and 
its 
territories 
and 
possessions 
or 
of 
any 
authority, 
commission 
or 
instrumentality 
of 
the 
United 
Statesr to the extent iael-Haasl-e that interest or those 
dividends are included in federal adjusted gross income 
~eF 
~eaeFal---i-n€-eme--1:a-~-flH~flesesr but exempt from state income 
taxes under the laws of the United Statesr-¥-ov-.ided--that 
the. 
The amount subtracted is must be decreased by any 
expenses 
incurred in the production of the interest or 
dividend income to the extent that these those expenses, 
including amortizable bond premiums, are aeaHetisl-e deducted 
in determining federal adjusted gross income; 
Sec. 35. 36 MRSA §5122, sub-§2, 1(B, as amended by PL 1997, 
c. 127, §2, is further amended to read: 
B. 
An 
amount equal to the taxpayer's federal aew--jeas 
eFEHli-&-eF work opportunity credit as determined under the 
laws of the United States; 
Sec. 36. 36 MRSA §5122, sub-§2, llJ, as amended by PL 2001, c. 
559, Pt. GG, §ll and affected by §26, is further amended to read: 
J. 
To the extent included in federal adjusted gross income, 
any amount constituting a qualified wit:aeFawa;b distribution 
from an account established pursuant to Title 20-A, chapter 
-E and used for paying higher education expenses of the 
designated beneficiary of that account; 
Sec. 37. 36 MRSA §5122, sub-§2, 1M, as amended by PL 2001, c. 
396, §34 and affected by §50, is further amended to read: 
M. 
Aa--amount~--ieF For each individual who is a primary 
recipient of benefits under an employee retirement plan, an 
amount that is the lesser of: 
(1) 
Six thousand dollars reduced by the total amount 
of the ~fE'iffiafE'y-£ee4~4eat:~6 individual's social security 
benefits and railroad retirement benefits paid by the 
United States, but not less than $0. 
The reduction 
does 
not 
apply 
to benefits paid under 
a 
military 
retirement plan; or 
(2) 
The aggregate of benefits 
fE'eeeivee-~~~-~fE'iffiafE'Y 
fE'eei~ieat: under employee retirement plans aae included 
in the individual's federal adjusted gross income. 
For purposes of this paragraph, "primary recipient" means 
the individual upon whose earnings the employee retirement 
plan benefits are based or the surviving spouse of that 
individual. 
For 
purposes 
of 
this 
paragraph, 
"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 Section 401(a), Section 403 or Section 
(b) of the Code. 
"Employee retirement plan" does not 
include 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. 
For purposes of this paragraph, 
"military 
retirement plan" means benefits received as 
a 
result of 
Page l2-LR1977(1) 
service in the active or reserve components of the Army, 
Navy, Air Force, Marines or Coast Guard; 
Sec. 38. 36 MRSA §S124-A, first 1(, as repealed and repl aced by 
PL 1989, c. 495, §2 and affected by c. 596, Pt. J, §7, is amended 
to read: 
The 
standard 
deduction 
of 
a 
resident 
EaHpayeF&--Saa±± 
individual 
must 
conform 
to 
the 
allewa91e--~eaeEal 
standard 
deduction 
e~ to which the EaHpayeE individual is entitled under 
the Code. 
Sec. 39. 36 MRSA §S12S, as amended by PL 1999, c. 708 , § 3 7 , 
is further amended to read: 
§S12S. Itemized deductions 
1. 
Genera1. 
1f.-aB An individual who has claimed itemized 
deductions from federal adjusted gross income in determining the 
individual's federal taxable income for the taxable yearT--t:.ae 
iRaivia~al-4£-~~~~~-~~t;.eFffiiai~-Eae-~aK-~-~~~-~aFt:.-Ee 
may claim aR itemized aea~et:.i9a-affie~RE-eeBsisEeaE-wita deductions 
from Maine adjusted gross income as provided in this section. 
2. 
Spouses. 
Spouses, both of whom are required to file 
returns under this Part, are allowed to claim itemized deductions 
from Maine adjusted gross income only if both do so. 
~Re Their 
total 
e~ itemized deductions 
a±±ewa91e--~eE--aeEeEmiRiR~ from 
federal iReeme-EaH adjusted gross income, as aaj~sEea modified by 
ERis--&eet:.iea subsection 3, 
may be taken by either spouse or 
divided between them, as they may elect, if their federal income 
tax is determined on a joint return but their tax 
p~E&H-aa-t::--te 
under this P~Lt_).S determined on separate returns. 
3. 
Amount. 
The 
sum of an individual' s 
allewa9~-.feaeEa± 
itemized deductions from federal adjusted gross income must be: 
A. 
Reduced 
by 
any 
amount 
EepEeseREiR~ attributable 
to 
income taxes 
imposed by this State or any other taxing 
jurisdiction 
aaa--4R~e£e£~--~--~--~~FF&d--ia--tRe 
pEea~eEieR-e~-iReeme-eHempE-~Eem-EaH-~RaeE-ERis-PaEE; 
B. 
Increased by any amount of interest or expense incurred 
in the production of income taxable under this Part but 
exempt from federal income taxT-.aOO--wh-i-eb--aas that was not 
geeR 
deducted 
in 
determining 
the 
individual's 
federal 
aaj~sEea-~Eess taxable income; aRa 
C. 
Reduced by any amount of deduction EelaEea attributable 
to income taxable to financial institutions under chapter 
... .:.. 
D. 
Reduced 
by 
any 
amount 
attributable 
to 
interest 
or 
expenses incurred in the production of income exempt from 
tax under this Part; and 
E. 
Reduced by the amount attributable to any contribution 
that gualified for and was actually utilized as 
a credit 
under section 5216-C. 
Sec. 40. 36 MRSA §5142, sub-§I, as amended by PL 1993, c. 478, 
§l, is further amended to read: 
1. 
General.. 
The 
Maine 
adjusted 
gross 
income 
nonresident individual derived from or connected with 
wi~bia in this State is the sum of the following: 
of 
a 
sources 
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 
wi th sources in this State including (i) the 
aea~esiaea~.!.s 
individual's distributive share of partnership or limited 
liability company 
income 
and deductions 
determined under 
section 5192, (ii) the 
aea~esiaea~.!.s individual's share of 
estate 
or 
trust 
income 
and 
deductions 
determined 
under 
section 
5176, 
and 
(iii) 
the 
Bea~esiaea~~s--ais~~ia~~ive 
individual's pro rata share of the income of an 
e±ee~ia~ 
sffia±±-a~siBess ~ corporation fe~-~eB~~-~~~~*-paFpeses 
derived from or connected with sources wi~bia in this State; 
B. 
The portion of the modifications described in section 
5122, 
subsections 
and 2 that 
~e±a~e relates to income 
derived 
from 
or 
connected with 
sources 
in this 
State, 
including any modifications attributable to the nonresident 
individual as a partner of a partnership, shareholder of an 
S corporation, 
member of 
a 
limited liability company or 
beneficiary of an estate or trust; and 
C. 
Proceeds from any Maine State Lottery or Tri-state Lotto 
tickets purchased in this State. 
Sec. 41. 36 MRSA §5160, as amended by PL 1993, c. 395, §19, 
is further amended to read: 
§5l.60. Imposition of tax 
The tax is imposed, at the rates provided by section 5111 
for ~esiaea~ single individuals, upon the Maine taxable income of 
estates and trusts. The tax must be paid by the fiduciary. 
Sec. 42. 36 MRSA §5163, as enacted by P&SL 1969, c. 154, §Fl, 
is amended to read: 
§5163. Maine taxable income of resident estate or trust 
The ~ 
taxable income of a resident estate or trust means 
is egual to its federal taxable income modified by the addition 
or subtractionT-as-~ae-ea6e-may-aeT of its share of the fiduciary 
adjustment determined under section 5164. 
Sec. 43. 36 MRSA §5175, as enacted by P&SL 1969, c. 154, §F1, 
is amended to read: 
§5175. Maine taxable income of a nonresident estate or trust 
1. 
General rules. For purposes of this chapter: 
A. 
Items of income, gain, loss and deduction mean those 
derived from or connected with sources in this StateTL 
B. 
Items of income, gain, loss and deduction entering into 
the definition of federal distributable net income ine!1:iEles 
include such items from another estate or trust of which the 
first estate or trust is a beneficiarYT; and 
C. 
The source of items of income, gain, loss or deduction 
saa!! must be determined under regulations prescribed by the 
assessor in accordance with the general rules in section 
5142 as if the estate or trust were a nonresident individual. 
2. 
Determination of Maine taxable income. The Maine taxable 
income of a nonresident estate or trust eansis~s-af+ is egual to 
its share of items of income, gain, loss and deduction that enter 
into the federal definition of distributable net income increased 
or reduced by the amount of any items of income, gain, loss or 
deduction that are recognized for federal income tax purposes but 
excluded from the federal definition of distributable net income 
of the estate or trust less the amount of the deduction for its 
federal exemption. 
AT--~~~~~-a~-~~effi£-~--1a~r-~a4R7-~~~-EleEl1:ietian 
waiea-eR~e%-~~~~~~~~~~~~~~~~~-ais~Fiba~able-Bet 
iBeame.,. 
8T---~~-~--%eEl1:ieeEl--by-~~-amo~R~--a~-~-~~~--a€ 
iBeameT-~~r-~~~--aF-~~~-wa4ea--&Fe-~~~-€aF 
feEleFa!-~-taH-~~-a1:i~-~~-~Fam-~~-~eEleFa! 
Ele~ini6iaB-~~-~~~~~~~-~~--iBeame-~~-~~-~~~~e--aF 
tF1:ist.,. 
GT---bass--tae--affia1:iBt--a~--tae--EleEl1:ietiaB--~aF--its--~eEleFal 
eHemptiaBT 
Sec. 44. 36 MRSA §5200-A, sub-§l,~, as amended by PL 1997, c. 
746, §7 and affected by §24, is further amended to read: 
I. 
Interest or dividends on obligations or securities of 
any 
state 
other 
than 
this 
State, 
or 
of 
a 
political 
subdivision or authoritYT of any state other than this State 
aBa--i~6--~91i~ieal--6asaivi6i9B6--aBa--aa~h9Fi~ie6, 
to 
the 
extent that interest or those dividends are not included in 
the taxpayer's federal taxable income; 
Sec. 45. 36 MRS A §5200-A, sub-§l, 1rK, as amended by PL 2001, 
c. 559, Pt. GG, 
§13 and affected by §26, is further amended to 
read: 
K. 
The amount claimed as a 
sasi:ae-&&-eK~eB6e deduction in 
determining federal taxable income that is included in the 
investment credi t ~ 
for the high-technology investment 
tax credit; 
Sec. 46. 36 MRSA §5200-A, sub-§2, 1rA, as enacted by PL 1981, 
c. 704, §4, is amended to read: 
A. 
Income whieh included in the taxpayer's federal taxable 
income that, under the laws of the United States, is exempt 
from taxation by states; 
Sec. 47. 36 MRSA §5200-A, sub-§2, "C, as amended by PL 2001, 
c. 177, §3, is further amended to read: 
C. 
An 
amount equal to 
the taxpayer's federal 
BeW--}9S6 
eFe-cii-t,.-9F work opportunity credit as determined under the 
laws of the United States; 
Sec. 48. 36 MRS A §5200-A, sub-§2, 1rF, as amended by PL 1989, 
c. 880, Pt. G, §7, is further amended to read: 
F. 
Income this State is prohibited from taxing under the 
Constitution of Maine or the United States 
Consti~utionT 
~F9v-iaee.--t-hat:--~he to the extent that it is included in the 
taxpayer's federal taxable income. 
The 
amount subtracted 
must be decreased by any expenses incurred in production of 
that income ~9-~he-eK~eB~ that ~hese-eH~eB6es-aFe-aeaae~iBle 
were deducted in determining federal taxable income; 
Sec. 49. 36 MRSA §5217-A, as amended by PL 1991, c. 591, Pt. 
N, §16 and affected by §17, is further amended to read: 
§5211-A. Income tax paid to other taxing jurisdiction 
A resident individual is allowed a credit against the tax 
otherwise due 
under this Part, 
excluding the tax imposed by 
section 5203-A, for the amount of income tax imposed on that 
indi vidual for the taxable year by another state of the United 
States, a political subdivision of any such state, the District 
of Columbia or 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 al:s9--&Ub-jeo-t.--1:9--t-&*--liBaeF 
1:ais-PaF1:. 
In 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 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 this Part, 
excluding the tax imposed by section 5203-A, 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; pF9viaea 
~xcept that, when a credit is 
claimed 
for 
taxes 
paid 
to 
both 
a 
state 
and 
a 
political 
subdivision of a 
state, the total credit allowable for those 
taxes does not exceed the proportion of the tax otherwise due 
under this Part, excluding the tax imposed by section 5203-A, 
that the amount of the taxpayer's Maine adjusted gross income 
derived from sources in the other state bears to the taxpayer's 
entire Maine adjusted gross income. 
Sec. 50. 36 MRSA §5218, as repealed and replaced by PL 2001, 
c. 396, §38, is amended to read: 
§52l8. Income tax credit for child care expenses 
1. 
Resident taxpayer. 
A resident individual is allowed a 
credit against the tax otherwise due under this Part in the 
amount of 25% of the federal tax credit allowable for child and 
dependent care expenses in the same tax year. 
2. 
Nonresident 
taxpayer. 
A 
nonresident 
9F--pa~~-yeaF 
FesiaeBE individual is allowed a credit against the tax otherwise 
due under this Part in the amount of 25% of the federal tax 
credit allowable for child and dependent care expenses multiplied 
by the ratio of the individual's Maine adjusted gross income, as 
defined in section 5102, 
subsection 1-C, paragraph B, 
to the 
B9BFesiaeBE..!.s individual's entire federal adjusted gross income, 
as modified by section 5122. 
2-A. 
P~rt-:r:eilr r~§ident taxl!a:r:er • 
An inQividugl who files 
a 
ret,yrn as 
a 
12ar t-y!:;lg,r 
residgnt in accordanc!:;l wit,h sgQtion 
5224-A is allQwgQ a !;;r!:;ldit, against, the tgX Qt,h!:;lrwisg gue under 
this 
Pgrt, 
in 
t,h!:;l 
amgynt 
of 
25% 
gf 
th!:;l 
t!:;lQeral 
tax credit 
allowable for child and dependent care expenses multiplied by a 
ratio, the numerator of which is the individual's Maine adjusted 
gross 
income 
as 
defined 
in 
section 
5102, 
subsection 
l-C, 
paragraph A for that portion of the taxable year during which the 
individual was a resident plus the individual's Maine adjusted 
gross 
income 
as 
defined 
in 
section 
5102, 
subsection 
1-C, 
paragraph B for that portion of the taxable year during which the 
individual was a nonresident, and the denominator of which is the 
individual's entire federal adjusted gross income, as modified by 
section 5122. 
3. 
Quall.ty child care services. 
The credit provided by 
subsections 1 anaL 2 and 2-A doubles in amount if the child care 
expenses were incurred through the use of quality child care 
servicesT--A£-~-~-~hi&-6e€~~eR7-~~~~~&&&~~-eEBe~w~se 
i:aa~ ea\;e s T - -'!.q-l*a-l-i-t,-y- - -ah-i-1-d- - -e-a-£-€-- se ~v iee s!.! - -l:i-a-s- - -t-he-- - me-a-B-i-B~- - se\; 
fe~EB as defined in section 5219-Q, subsection 1. 
4. 
Refund. 
The credit allowed by this section may result 
in a refund of up to $500. 
Sec. 51. 36 MRSA §5219-A, sub-§2~ as enacted by PL 1999, c. 
521, Pt. B, §7 and affected by §11, is amended to read: 
2. 
Nonresident 
taxpayer. 
A 
nonresident 
e~--~-a-£~-yea~ 
resiaenE individual is allowed a credit against the tax otherwise 
due under this Part equal to 
20°,<> of any credit the individual 
received for the same taxable year under the Code, Section 22 
multiplied by the ratio of the individual's Maine adjusted gross 
income, as defined in section 5102, subsection 1-C, paragraph B, 
to the 
:aen~es~aen\;!.s individual's entire federal adjusted gross 
income, as modified by section 5122. 
In no case may this credit 
reduce the Maine income tax to less than zero. 
Sec. 52. 36 MRSA §5219-A, sub-§3 is enacted to read: 
3. 
Part-year resident taxpayer. 
An individual who files a 
return as a part-year resident in accordance with section 5224-A 
is allowed a credit against the tax otherwise due under 
th.~.s Part 
equal to 20°,<> of any credit the individual received for the same 
taxable year under the Code, Section 22 multiplied by a ratio, 
the numerator of which is the individual's Maine adjusted gross 
income as defined in section 5102, subsection 1-C, paragraph A 
for that portion of the taxable year during which the individual 
was a resident plus the individual's Maine adjusted gross income 
as defined in section 5102, subsection 1-C, paragraph B for that 
portion of the taxable year during which the individual was a 
nonresident, 
and the denominator of which is the individual's 
entire federal adjusted gross 
income, 
as modified by section 
5122. 
In no case may this credit reduce the Maine income tax to 
less than zero. 
Sec. 53. 36 MRSA §5219-N, sub-§§l and 3, as enacted by PL 1997, 
c. 557, Pt. E, §1 and affected by §2 and Pt. G, §1, are amended 
to read: 
1. 
Generally. 
Except as ethe~wise provided ay-this-seetien 
in subsection 2, an individual whose state Maine taxable income 
determined as if the individual were a resident individual for 
the entire year is $2,000 or less is allowed a credit equal to 
the--amo-unt--et the tax otherwise imposed on that individual by 
this Part. 
In no case may the this credit allewEHi--by--this 
seetien 
reduce 
an--inaiviaQal~s--state the 
Maine 
income 
tax 
liaaility to less than zero. 
3. 
Returns not required. 
any other provision of law, an 
this credit is not required to 
Notwithstanding section 5220 or 
individual who is eligible for 
file a state Maine income tax 
return. 
Sec. 54. 36 MRSA §5231, sub-§l, as amended by PL 1989, c. 871, 
§19, is further amended to read: 
1. 
General. The 
assesse~ State Tax Assessor may grant a 
reasonable extension of time for payment of tax or estimated tax 
or 
any 
installment, 
or 
for 
filing 
any 
return, 
declaration, 
statement or other document required pursuant to this Part, on 
terms and conditions the assessor may require. Except as provided 
in subsection I-A or for a taxpayer who is outside the United 
States, 
an 
extension 
for 
filing 
any 
return, 
declaration, 
statement or document may not exceed 8 months. 
Sec. 55. 36 MRSA §5231, sub-§l-A, as amended by PL 1997, c. 
404, §9 and affected by §10, is further amended to read: 
1-A. 
Federal extension. 
When 
an individual, 
estate or 
trust is granted an extension of time within which to file a 
federal income tax return for any taxable year, the due date for 
filing the taxpayer's income tax return with respect to the tax 
imposed by this Part is automatically extended for an equivalent 
period. 
When a taxable corporation or a 
financial institution 
subject to the tax imposed by chapter 819 is granted an extension 
of time within which to file its federal income tax return for 
any taxable year, the due date for filing the taxpayer's income 
tax or franchise tax return with respect to the tax imposed by 
this Part is automatically extended for an equivalent period plus 
days. 
Sec. 56. 36 MRSA §5316, as amended by PL 1971, c. 622, §132, 
is repealed. 
Sec. 57. 36 MRSA §6652, sub-§1, as amended by PL 2001, c. 396, 
§45, is further amended to read: 
1. 
Genera11y. 
A person against 
whom 
taxes 
have 
been 
assessed pursuant to Part 2, except for chapters III and 112, 
with respect to eligible property and who has paid those taxes is 
entitled to 
reimbursement of those taxes 
from 
the State as 
provided in this chapter. 
For purposes of this chapter, a tax 
applied as a credit against a tax assessed pursuant to chapter 
III or 112 is a tax assessed pursuant to chapter III or 112. 
Eligible property is subject to reimbursement pursuant to th::'s 
chapter for up to 12 property tax years, but the 12 years must be 
reduced 
by 
one 
year for 
each year during which 
a 
taxpay~r 
included the same property in its investment credit base under 
section 5219-D, 5219-E or 5219-M and claimed the credit provided 
in one or more of those sections on its income tax return, and 
reimbursement may not be made for taxes assessed in a year in 
which one or more of those credits is taken. 
A successor in 
interest of a person against whom taxes have been assessed with 
respect 
to 
eligible 
property 
is 
entitled 
to 
reimbursement 
pursuant to this section, whether the tax was paid by the person 
assessed or by the successor, 
as 
long as 
a transfer of the 
property in question to 
the 
successor has 
occurred 
and the 
successor is the owner of the property as of August 1st, of the 
year in which a claim for reimbursement may be filed pursuant to 
section 6654. 
For purposes of this paragraph, 
"successor in 
interest" 
includes 
the initial 
successor 
and 
any 
subsequent 
successor. 
When an eligible successor in interest exists, the 
successor is the only person to whom reimbursement under this 
chapter may be made with respect to the transferred property. 
Sec. 58. P&SL 1999, c. 53 is repealed. 
Sec. 59. Application. 
That section of this Act that. 
1999, 
chapter 
applies to 
in the elderly low-cost drug 
Private and Special Law 
applying for participation 
after December 31, 2002. 
repeals 
persons 
program 
Sec. 60. Effective date. 
That section of this Act that amends 
the Maine Revised Statutes, Title 36, section 191, subsection 2, 
paragraph R, as amended by Public Law 2001, chapter 714, Part ee, 
section 2, takes effect when the provisions in Public Law 2001, 
chapter 714, Part ee, section 8 are met. 
SUMMARY 
This bill makes the following changes to the laws governing 
taxation. 
The 
bill 
establishes 
specific 
statutory 
authority 
and 
procedures for the State Tax Assessor to accept protective claims 
for refund. 
The bill clarifies that a 
taxpayer who fails to file a 
timely request for administrative review of a denial of a tax 
refund claim forfeits the right to seek review of the denial in 
Superior Court and that the taxpayer can not submit reiterative 
claims for the same refund. 
The bill amends the law governing confidentiality of tax 
information 
to 
allow disclosure 
to 
the 
Department of 
Human 
Services 
and 
the 
Department 
of 
Behavioral 
and 
Developmental 
Services 
of 
information 
relating 
to 
the 
administration 
and 
collection of the hospital tax. 
This provision was inadvertently 
omitted 
from 
the supplemental 
appropriations bill enacted in 
November 2002, which imposed the new tax. 
The 
bill 
allows 
the 
Financial 
Services, 
Bureau 
taxpayer information to the 
of 
Head 
Start 
and 
Child 
investments eligible for the 
Department 
of 
Administrative 
and 
of 
Revenue 
Services 
to 
provide 
Department of Human Services, Office 
Care 
for 
purposes 
of 
certifying 
quality child care investment credit. 
The bill allows employees of the Bureau of Revenue Services 
to disclose certain information to the Finance Authority of Maine 
necessary to ensure that individual recipients are eligible to 
receive certain benefits under the Maine College Savings Program. 
The bill deletes a redundant definition of the term "person" 
from the Sales and Use Tax Law. 
The same term is defined for all 
taxes in the general provisions of the tax laws. 
The bill amends the definition of "retail sale" to clarify 
that sales of all kinds of video media for rental are not 
taxable, consistent with other statutory changes enacted in 2002. 
The bill corrects outdated cross-references to sections 187 
and 1951, which have been repealed, and makes various grammatical 
corrections. 
The bill corrects 
a 
conflict between the 
Maine 
Revised 
Statutes, Title 36, 
sections 1861-A 
and 
1951-A regarding an 
individual's use tax responsibility to the State. 
Title 36, 
section 1861-A added a reporting mechanism for an individual to 
report and pay use tax on small purchase.; made outside of the 
State, such as through mail order or shopping trips to places 
outside the State. 
This change to Title 36, section 1861-A would 
allow the use tax line on the individual income tax return to be 
used only for reporting use tax on items with a purchase price of 
$1,000 or less. 
Use tax on items with a purchase price of more 
than $1, 000 would be due and payable by the 15th of the month 
following the date of purchase. 
The bill deletes a 
redundant provision for abatement of 
sales and use taxes. 
The circumstances under which all taxes may 
be abated are set forth more fully in the general provisions of 
the tax 
laws. 
The bill also corrects references to taxable 
services to reflect current law, corrects a grammatical error and 
changes gender-specific language. 
The bill deletes a redundant definition of the term "person" 
from the Gasoline Tax Act. 
The same term is defined for all 
taxes in the general provisions of the tax laws. 
The bill replaces outdated references to state and federal 
statutes governing highway common carriers. 
The Public Utilities 
Commission no longer regulates highway common carriers and the 
federal excise tax no longer applies to highway transportation. 
The bill substitutes 
a 
cross-reference 
to 
the 
statute that 
imposes the current operating authority license requirement and 
incorporates the relevant language of the repealed federal law 
into 
Maine 
law. 
The 
bill 
also 
clarifies 
the 
formula 
for 
computing the amount of the refunds authorized by the statute, 
eliminates redundant verbiage and gender-specific language. 
The bill corrects inappropriate references to "distributor" 
in the Special Fuel Tax Act. 
"Distributor" is not defined in the 
Maine Revised Statutes, Title 36, 
chapter 459 
and is defined 
elsewhere in Title 36 to mean a different category of persons 
from what is intended here. 
The bill corrects 
inappropriate 
references 
to 
"internal 
combustion engine fuel" in the Special Fuel Tax Act. 
"Internal 
combustion engine fuel" is not defined in Title 36, chapter 459 
and is defined elsewhere in Title 36 to mean a different type of 
fuel 
from 
what 
is 
intended 
here. 
The 
bill 
also 
removes 
superfluous verbiage and corrects grammatical errors. 
The 
bill 
corrects 
an 
inappropriate 
reference 
to 
"distributor" in the Special Fuel Tax Act. 
"Distributor" is not 
defined in Title 36, chapter 459 and is defined elsewhp.re in 
Title 36 to mean a different category of persons from what is 
intended here. 
The bill eliminates an obsolete reference to the gasoline 
road tax law, which has been repealed. 
The bill establishes 
an automatic extension to file 
an 
estate tax return equivalent to the federal extension and limits 
the filing extension to 
months 
in all other cases. 
These 
changes provide a statutory basis for policies that have been 
implemented administratively. 
The bill standardizes a reference to the federal credit for 
state death taxes in the estate tax law for consistency with 
other statutory revisions made in 2002. 
The 
bill 
clarifies 
the 
administrative 
requirements 
pertaining to the sale of a controlling interest in real property 
in the real estate transfer tax law, consistent with statutory 
changes enacted in 2002. 
The bill simplifies the recycling assistance fee 
law by 
deleting references to categories of property that are no longer 
subject to the fee. 
The bill repeals a provision that required 
State Tax Assessor to clarify the impact of 
recycling assistance fee 
law. 
Simplification 
obviated the need for rulemaking. 
rulemaking by the 
portions of the 
of the law has 
The bill clarifies that the taxable income described in 
Title 36, section 5121 is the "Maine taxable income" referred to 
in section 5111. 
The bill clarifies that only interest from bonds of another 
state's government excluded from federal adjusted gross income 
must be added back in computing Maine adjusted gross income for a 
resident individual. 
The bill clarifies that all deductions claimed for federal 
income tax purposes must be added back to Maine adjusted gross 
income if they are included in the taxpayer' s investment credit 
base for the high-technology investment tax credit. 
The bill clarifies that only exempt government 
included in federal adjusted gross income may be 
computing Maine adjusted gross income. 
bond interest 
subtracted in 
The bill deletes an obsolete reference to the federal new 
jobs credit, which has been repealed. 
The bill conforms 
Maine College Savings 
20-A, section 11479. 
the language that permits 
Program distributions to 
subtraction of 
that of Ti tle 
The bill defines "primary recipient" for purposes of the 
pension int.:ome deduction. 
This definition is the one currently 
applied administratively by the Department of Administrative and 
Financial Services, Bureau of Revenue Services. 
The bill clarifies the language of Title 36, section 5124-A. 
The bill clarifies references to federal 
adjusted gross 
income 
and federal 
taxable 
income 
for purposes 
of 
computing 
itemized deductions and adds a provision specifically requiring 
add-back of the deduction for contributions to family development 
account reserve funds that is disallowed by the last sentence of 
Title 36, section 5216-C, subsection 1. 
The bill clarifies that the adjusted gross income described 
in Title 36, section 5142 is the Maine adjusted gross income 
defined in section 5102, subsection 1-C, paragraph B and taxed by 
section 5111, 
subsection 4 
and that the Maine adjusted gross 
income 
of 
a 
nonresident individual includes the individual's 
share of income, 
deductions and modifications attributable to 
Maine-source 
income 
of 
a 
partnership 
or 
limited 
liability 
company, estate, trust or S corporation. 
These changes conform 
to current agency practice. 
The bill clarifies that the taxable income of estates and 
trusts on which the tax is imposed is the Maine taxable income 
described in Title 36, 
sections 
5163 
and 
5175 
and that the 
applicable tax rates are those provided for single individuals. 
The bill clarifies that 
estates and trusts described 
Maine 
taxable 
income 
taxed 
superfluous verbiage. 
the taxable 
in Title 36, 
by 
section 
income 
section 
5160 
of 
5163 
and 
resident 
is the 
deletes 
The bill clarifies that the taxable 
estates and trusts described in Title 36, 
Maine 
taxable 
income 
taxed 
by 
section 
grammatical errors. 
income of nonresident 
section 5175 is the 
5160 
and 
corrects 
The bill clarifies that bond interest from 
government bonds excluded from federal taxable 
added back in computing Maine taxable income of a 
another state's 
income mus t 
be 
corporation. 
The bill clarifies that all deductions claimed for federal 
income tax purposes must be added back to the extent they are 
included 
in 
the 
taxpayer's 
investment 
credit 
base 
for 
the 
high-technology investment tax credit. 
The bill clarifies 
taxable 
income 
may 
be 
income. 
that exempt 
subtracted 
income included in 
in computing Maine 
federal 
taxable 
The 
bill 
clarifies 
that 
constitutionally 
exempt 
income 
included in federal taxable income may be subtracted in computing 
Maine taxable income. 
The bill clarifies that the credit for income tax paid to 
another taxing jurisdiction is limited to tax paid with respect 
to income that Maine recognizes as being derived from sources in 
the other taxing jurisdiction. 
The changes conform to current 
agency practice. 
The bill clarifies the 
care expenses by part-year 
current 
agency practice. 
calculation of the credit for child 
residents. 
The changes conform to 
The bill also deletes 
superfluous 
verbiage. 
The bill clarifies the calculation 
disability credit by part-year residents. 
current agency practice. 
of the retirement and 
The changes conform to 
The bill makes it clear that the $2,000 income limit for the 
low-income 
credit applies 
to 
an 
individual's entire taxable 
income 
as 
determined 
for 
resident individuals 
regardless 
of 
whether the taxpayer was a Maine resident for the entire year. 
The bill clarifies the circumstances under which a taxpayer 
may be granted an extension of time to file an individual or 
fiduciary income tax return. 
The bill establishes an automatic extension of time to file 
an individual or fiduciary income tax return equivalent to the 
federal extension. 
These changes provide a statutory basis for 
policies that have been implemented administratively. 
The bill repeals 
a 
collection of income tax 
granted to the State Tax 
~n the general provisions 
redundant provision relating to 
the 
debts owed by nonresidents. 
The powers 
Assessor by this provision are included 
of the tax laws. 
The bill amends the business equipment tax reimbursement 
statutes to provide that business equipment tax reimbursement is 
available, 
and limited to, 
a 
successor in interest that owns 
eligible business property on August 1st of the year in which a 
claim may be made. 
The bill repeals a law that requires adoption of a rule for 
the elderly low-cost drug program to allow consideration of an 
applicant's change in income from the prio.>: year. 
As of January 
1, 2003, the elderly low-cost drug program is being administered 
by the Department of Human Services under the laws that govern 
the 
Healthy 
Maine 
Prescription 
Program, 
which 
determines 
eligibility based 
on 
the 
current 
income 
of 
the 
applicant. 
Repealing this law will allow the Bureau of Revenue Services to 
repeal the rule that is no longer applicable.