An Act To Amend the Tax Laws
Maine Legislature, Session 125, LD 1749
Committee: Taxation
Sponsors: KNIGHT
Amends: 36 MRSA §187-B, 36 MRSA §1752, 36 MRSA §1754-A, 36 MRSA §5122, 36 MRSA §5200-A, 36 MRSA §5203-C, 36 MRSA §5219-H

Legislative Document 
No. 1749
H.P. 1290 
House of Representatives, January 9, 2012
An Act To Amend 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. 
HEATHER J.R. PRIEST 
Clerk 
Presented by Representative KNIGHT of Livermore Falls. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  36 MRSA §187-B, sub-§1, ¶A, as amended by PL 1999, c. 521, Pt. A, 
§2, is further amended to read: 
A.  If the return is filed before or within 30 60 days after the taxpayer receives from 
the assessor a formal demand that the return be filed, or if the return is not filed but 
the tax due is assessed by the assessor before the taxpayer receives from the assessor 
a formal demand that the return be filed, the penalty is $25 or 10% of the tax due, 
whichever is greater. 
Sec. 2.  36 MRSA §187-B, sub-§1, ¶B, as amended by PL 2011, c. 380, Pt. K, §1 
and affected by §2, is further amended to read: 
B.  If the return is not filed within 30 60 days after the taxpayer receives from the 
assessor a formal demand that the return be filed, the penalty is $25 or 25% of the tax 
due, whichever is greater.  The period provided by this paragraph must be extended 
for up to 120 90 days if the taxpayer requests an extension in writing prior to the 
expiration of the original 30-day 60-day period. 
Sec. 3.  36 MRSA §187-B, sub-§1-A, as enacted by PL 2007, c. 437, §3 and 
affected by §22, is amended to read: 
1-A.  Failure to file information return.  Any A partnership or S corporation that 
fails to make and file an information return required by section 5241 and that has 
received from the assessor a formal demand that the return be filed is liable for one of the 
following penalties: 
A.  If the return is filed within 30 60 days after the partnership or S corporation 
receives from the assessor a formal demand that the return be filed, the penalty is 
$100. The 30-day period provided by this paragraph is must be extended for up to 
90 days if the partnership or S corporation requests an extension in writing prior 
to the expiration of the 30-day 60-day period; or 
B.  Except as provided in paragraph A, if the return is not filed within 30 60 days 
after the partnership or S corporation receives from the assessor a formal demand that 
the return be filed, the penalty is $500. 
Sec. 4.  36 MRSA §1752, sub-§1-B, as amended by PL 2011, c. 296, §1, is 
further amended to read: 
1-B.  Automobile.  "Automobile" means a self-propelled 4-wheel motor vehicle 
designed primarily to carry passengers and not designed to run on tracks.  "Automobile" 
includes a pickup truck or van with a registered gross vehicle weight rating of 10,000 
pounds or less. 
Sec. 5.  36 MRSA §1754-A, as amended by PL 2003, c. 390, §9, is further 
amended to read: 
§1754-A.  Registration of owners of space temporarily rented as retail space 
A person who rents or leases space to more than 4 persons at one location for less 
than a 12-month period for the purpose of making 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 assessor.  For each location where 
more than 4 persons rent or lease space for less than 12 months from the same person, the 
assessor shall issue a registration certificate, which must be conspicuously displayed at 
that location.  By 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.  Information returns must be prescribed and furnished free of charge 
by the assessor.  Returns required under this section must be treated as returns filed under 
this Title and are subject to section 187-B.  A registration certificate issued pursuant to 
this section is nontransferable and is not a license within the meaning of that term in the 
Maine Administrative Procedure Act. 
A person required to register with the assessor under this section may not rent or 
lease space to a person for the purpose of making retail sales without verifying that the 
person is the holder of a valid registration certificate issued by the assessor under section 
1754-B.  Each person required to register with the assessor under this section shall 
maintain a list subject to the requirements of section 135, subsection 1 that includes the 
names, addresses and sales tax registration certificate numbers of those persons who have 
rented or leased space at that location for the purpose of making retail sales and the dates 
on which those rentals or leases occurred. 
Sec. 6.  36 MRSA §5122, sub-§2, ¶HH, as corrected by RR 2011, c. 1, §54, is 
amended to read: 
HH.  To the extent included in federal adjusted gross income, annuity payments made 
to the survivor of a deceased member of the military as the result of service in active 
or reserve components of the United States Army, Navy, Air Force, Marines or Coast 
Guard under a survivor benefit plan or reserve component survivor benefit plan 
pursuant to 10 United States Code, Chapter 73 reduced by any amount claimed as a 
modification under paragraph M;  
Sec. 7.  36 MRSA §5122, sub-§2, ¶II, as corrected by RR 2011, c. 1, §56, is 
amended to read: 
II.  For taxable years beginning on or after January 1, 2012, an amount equal to the 
net increase in the depreciation deduction allowable under the Code, Sections 167 
and 168 that would have been applicable to that property had the depreciation 
deduction under the Code, Section 168(k) not been claimed with respect to such 
property placed in service during the taxable year beginning in 2011 or 2012 for 
which an addition was required under subsection 1, paragraph FF, subparagraph (2) 
for the taxable year beginning in 2011 or 2012. 
Upon the taxable disposition of property to which this paragraph applies, the amount 
of any gain or loss includable in federal adjusted gross income must be adjusted for 
Maine income tax purposes by an amount equal to the difference between the 
addition modification for such property under subsection 1, paragraph FF, 
subparagraph (2) related to property placed in service outside the State and the 
subtraction modifications allowed pursuant to this paragraph. 
The total amount of subtraction claimed for property placed in service outside the 
State under this paragraph for all tax years may not exceed the addition modification 
under subsection 1, paragraph FF, subparagraph (2) for the same property; and 
Sec. 8.  36 MRSA §5122, sub-§2, ¶JJ, as reallocated by RR 2011, c. 1, §55, is 
amended to read: 
JJ.  To the extent included in federal adjusted gross income, an amount equal to the 
distribution from a private venture capital fund of the refundable portion of the credit 
allowed under section 5216-B.; and 
Sec. 9.  36 MRSA §5122, sub-§2, ¶KK is enacted to read: 
KK.  To the extent included in federal adjusted gross income, an amount equal to the 
refundable portion of the new markets capital investment credit. 
Sec. 10.  36 MRSA §5200-A, sub-§2, ¶U, as amended by PL 2011, c. 380, Pt. O, 
§15 and c. 454, §12, is further amended to read: 
U.  An amount equal to the gross income from discharge of indebtedness previously 
deferred under the Code, Section 108(i) and included in federal taxable income. The 
total subtraction for all years under this paragraph may not exceed the amount of the 
addition modification under subsection 1, paragraph W for the same indebtedness; 
and 
Sec. 11.  36 MRSA §5200-A, sub-§2, ¶V, as corrected by RR 2011, c. 1, §57, is 
amended to read: 
V.  For taxable years beginning on or after January 1, 2012, an amount equal to the 
net increase in the depreciation deduction allowable under the Code, Sections 167 
and 168 that would have been applicable to that property had the depreciation 
deduction under the Code, Section 168(k) not been claimed with respect to such 
property placed in service during the taxable year beginning in 2011 or 2012 for 
which an addition was required under subsection 1, paragraph Y, subparagraph (2) 
for the taxable year beginning in 2011 or 2012. 
Upon the taxable disposition of property to which this paragraph applies, the amount 
of any gain or loss includable in federal adjusted gross income must be adjusted for 
Maine income tax purposes by an amount equal to the difference between the 
addition modification for such property under subsection 1, paragraph Y, 
subparagraph (2) related to property placed in service outside the State and the 
subtraction modifications allowed pursuant to this paragraph. 
The total amount of subtraction claimed for property placed in service outside the 
State under this paragraph for all tax years may not exceed the addition modification 
under subsection 1, paragraph Y, subparagraph (2) for the same property; and 
Sec. 12.  36 MRSA §5200-A, sub-§2, ¶W, as reallocated by RR 2011, c. 1, §58, 
is amended to read: 
W.  To the extent included in federal taxable income, an amount equal to the 
refundable portion of the credit allowed under section 5216-B and an amount equal to 
the distribution from a private venture capital fund of the refundable portion of the 
credit allowed under section 5216-B.; and 
Sec. 13.  36 MRSA §5200-A, sub-§2, ¶X is enacted to read: 
X.  To the extent included in federal taxable income, an amount equal to the 
refundable portion of the new markets capital investment credit. 
Sec. 14.  36 MRSA §5203-C, sub-§4, ¶A, as amended by PL 2005, c. 618, §8 
and affected by §22, is further amended to read: 
A.  A minimum tax credit is allowed against the liability arising under this Part for 
any taxable year other than withholding tax liability.  The minimum tax credit equals 
the excess, if any, of the adjusted alternative minimum tax, reduced by the credit for 
tax paid to other jurisdictions determined under subsection 3 and, the seed capital 
investment tax credit provided by section 5216-B, the Pine Tree Development Zone 
tax credit provided by section 5219-W, the credit for rehabilitation of historic 
properties after 2007 provided by section 5219-BB and the new markets capital 
investment credit that was imposed for all prior taxable years beginning after 2003 
over the amount allowable as a credit under this subsection for such those prior 
taxable years, plus unused minimum tax credits from years beginning after 1990. 
Sec. 15.  36 MRSA §5219-H, sub-§1, as amended by PL 2011, c. 240, §36, is 
further amended to read: 
1.  Meaning of tax.  Whenever a credit provision in this chapter, other than section 
5216-B, section 5219-W, section 5219-BB and the new markets capital investment credit, 
allows for a credit "against the tax otherwise due under this Part," "against the tax 
imposed by this Part" or similar language, "tax" means all taxes imposed under this Part, 
except the minimum tax imposed by section 5203-C and the taxes imposed by chapter 
827. 
Sec. 16.  Application.  Those sections of this Act that amend the Maine Revised 
Statutes, Title 36, section 5122, subsection 2, paragraph HH, Title 36, section 5203-C, 
subsection 4, paragraph A and Title 36, section 5219-H, subsection 1 and that enact Title 
36, section 5122, subsection 2, paragraph KK and Title 36, section 5200-A, subsection 2, 
paragraph X apply to tax years beginning on or after January 1, 2012. 
Sec. 17.  Retroactivity.  Those sections of this Act that amend the Maine Revised 
Statutes, Title 36, section 187-B, subsections 1 and 1-A apply retroactively to July 1, 
2011.  That section of this Act that amends Title 36, section 1752, subsection 1-B applies 
retroactively to September 28, 2011. 
Sec. 18.  Effective date.  That section of this Act that amends the Maine Revised 
Statutes, Title 36, section 1754-A takes effect August 1, 2012. 
SUMMARY 
This bill makes the following changes to the laws governing taxation. 
It extends from 30 days to 60 days the period during which a person who has 
received a demand to file a delinquent tax return must either file the return or request an 
extension in order to avoid an enhanced penalty. 
It provides that the weight limitation for a pickup truck or van included in the 
definition of "automobile" in the sales and use tax law applies to the gross vehicle weight 
rating of the vehicle. 
It removes the requirement that persons who rent or lease temporary retail space must 
file monthly returns reporting those rentals and replaces it with a tax registration 
certificate and record-keeping requirement.  Additionally, the characteristics of the 
registration certificates are clarified. 
It provides that an amount claimed as an income modification for military survivor 
benefits may not include an amount representing employee retirement benefits for which 
an income modification is claimed. 
It provides that any income recognized on a taxpayer's federal tax return from the 
new markets capital investment credit is subtracted from federal adjusted gross income 
for state income tax purposes. 
It provides that certain refundable tax credits are included for purposes of calculating 
the taxpayer's alternative minimum tax credit. 
It provides that certain refundable tax credits may be applied to reduce the taxpayer's 
alternative minimum tax liability.