An Act To Amend Maine's Estate Tax Law
Maine Legislature, Session 122, LD 1264
Committee: Taxation
Sponsors: MILLS, WOODBURY
Amends: 36 MRSA §4062, 36 MRSA §4068

Legislative Document 
No. 1264 
S.P.444 
In Senate, March 15, 2005 
An Act To Amend Maine's Estate Tax Law 
Reference to the Committee on Taxation suggested and ordered printed. 
Presented by Senator MILLS of Somerset. 
Cosponsored by Representative WOODBURY of Yarmouth. 
Printed on recycled paper 
JOY J. O'BRIEN 
Secretary of the Senate 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 36 MRSA §4062, sub-§I-A, as amended by PL 2003, c. 
673, Pt. D, §l, is repealed and the fo11owing enacted in its 
place: 
I-A. 
Federal credit. 
"Federal credit" has the fo11owing 
meanings; 
A. 
For the estates of decedents dying after December 31, 
2002, "federal credit" means the maximum credit for state 
death taxes determined under the Code, Section 2011 as of 
December 31, 2002 exclusive of the reduction of the maximum 
credit contained in the Code, Section 20ll(b)(2); the period 
of limitations under the Code, 
Section 20ll(c); 
and the 
termination 
provision 
contained 
in 
the 
Code, 
Section 
20ll(f). 
The federal taxable estate is to be determined 
using the applicable Code as of the date of the decedent's 
death, except that: 
(1) 
The state death tax deduction contained in the 
Code, Section 2058 is to be disregarded; 
(2) The unified credit is to be determined under the 
Code. Section 2010 as of December 31. 2000; 
(3) For the estates of decedents dying after December 
31. 2004. the federal taxable estate must be decreased 
by an amount egual to the value of Maine gualified 
terminable 
interest property in 
the estate of 
the 
decedent; and 
(4) For the estates of decedents dying after December 
31, 2004. the federal taxable estate must be increased 
by an 
amount equal to the value of Maine elective 
property in respect of the decedent; and 
B. 
For the estates of a11 other decedents. "federal credit" 
means the maximum credit for state death taxes determined 
under the Code. Section 2011. 
Sec. 2. 36 MRSA §4062, sub-§§2-A and 2-B are enacted to read: 
A. 
Maine elective property. 
"Maine elective property" 
means all property in which the decedent at the time of death had 
a qualified income interest for life and with respect to which. 
for purposes of determining the tax imposed by this chapter on 
the estate of a predeceased spouse of the decedent. the federal 
taxable estate of such predeceased spouse was decreased pursuant 
Page l-LR1169(1) 
to subsection I-A. paragraph A. 
subparagraph (3). The value of 
Maine elective property is the value finally determined by the 
assessor in accordance with the Code as if such property were 
includable in the decedent's federal gross estate pursuant to the 
Code. Section 2044 and. in the case of estates that do not incur 
a federal estate tax. as if the estate had incurred a federal 
estate tax. 
2-B. 
Maine qualified terminable interest property. 
"Maine 
qualified terminable interest property" means property; 
A. That is eligible to be treated as qualified terminable 
inte~est property under the Code. Section 2056(b)(7); 
B. For which no election allowable under the Code. Section 
2056(b) (7) is made with respect to the federal estate tax; 
£lli1 
C. With respect to which an election is made. on a return 
tiled timely with the assessor. to treat the property as 
Maine qualified terminable interest property for purposes of 
the tax imposed by this chapter. The amount of property with 
respect to which such election is made may not be greater 
than the amount. if any. by which the applicable exclusion 
amount determined as of the date of the decedent's death 
using the Code. 
Section 20l0(c) 
in effect on that date 
exceeds the applicable exclusion amount determined as of the 
date of the decedent's death using the Code. Section 20l0(c) 
in effect 
on 
December 
31. 
2000. 
The 
value 
of 
Maine 
qualified terminable interest property is the value finally 
determined by the asseSSQr in accordance with the Code and. 
in the case of estates that do not incur a federal estate 
tax. as if the estate had incurred a federal estate tax. 
Sec. 3. 36 MRSA §4068, sub-§3, as amended by PL 2003, c. 673, 
Pt. 
D, 
§6 
and affected by §9, is repealed and the following 
enacted in its place; 
3. 
No tax liability. In all cases where there is no Maine 
estate tax liability; 
A. If the personal representative makes no election pursuant 
to 
section 
4062. 
subsection 
2-B, 
the 
personal 
representative. surviving joint tenant of real estate or any 
other person whose real estate might be subject to a lien 
for taxes pursuant to this chapter may at any time file with 
the 
assessor in the 
form prescribed by 
the assessor 
a 
statement of the value of the federal gross estate; and 
B. If the personal representative makes an election pursuant 
to section 4062, subsection 2-B, the personal representative 
shall make such election on a 
timely filed return. 
The 
~turn must be in the form prescribed by the assessor and it 
must be accompanied by a 
copy of the federal estate tax 
return, if any, and other supporting documentation that the 
.assessor may require, including documentation related to an 
election made pursuant to section 4062, subsection 2-B. 
Sec. 4. Application. 
Those sections of this Act that repeal 
and replace the Maine Revised Statutes, Title 36, section 4062, 
subsection I-A and section 4068, subsection 3 and enact Title 36, 
section 
4062, 
subsections 
2-A 
and 
2-B 
apply 
to estates 
of 
decedents dying on or after January 1, 2005. 
SUMMARY 
This bill allows for a special estate tax election at the 
state level so that the estate of an individual with a surviving 
spouse may fully fund the taxable estate with an amount equal to 
the federal exclusion without changing the taxable nature of the 
estate for Maine purposes. 
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