An Act To Provide Property Tax Relief to Maine Residents
Maine Legislature, Session 126, LD 1751
Committee Amendment CA_A_H785 (House)
Amends: 22 MRSA §4301, 36 MRSA §5219-I, 36 MRSA §5219-K, 36 MRSA §5403

COMMITTEE AMENDMENT "A" to H.P. 1257, L.D. 1751, Bill, "An Act To 
Provide Property Tax Relief to Maine Residents" 
Amend the bill by striking out everything after the enacting clause and before the 
summary and inserting the following: 
'Sec. 1. 22 MRSA §4301, sub-§7, as amended by PL 2013, c. 368, Pt. 00, §6, is 
further amended to read: 
7. Income. "Income" means any form of income in cash or in kind received by the 
household, including net remuneration for services performed, cash received on either 
secured or unsecured credit, any payments received as an annuity, retirement or disability 
benefits, veterans' pensions, workers' compensation, unemployment benefits, benefits 
under any state or federal categorical assistance program, supplemental security income, 
social security and any other payments from governmental sources, unless specifically 
prohibited by any law or regulation, court ordered support payments, income from 
pension or trust funds, household income from any other source, including relatives or 
unrelated household members and any benefit received pursuant to Title 36, chapter 907 
aad~ Title 36, section 5219-Il and Title 36, section 5219-KK, unless used for basic 
necessities as defined in section 4301, subsection 1. 
The following items are not available within the meaning of this subsection and 
subsection 10: 
A. 
Real or personal income-producing property, tools of trade, governmental 
entitlement specifically treated as exempt assets by state or federal law; 
B. Actual work-related expenses, whether itemized or by standard deduction, such as 
taxes, retirement fund contributions, union dues, transportation costs to and from 
work, special equipment costs and child care expenses; or 
C. Earned income of children below the age of 18 years who are full-time students 
and who are not working full time. 
COMMITTEE AMENDMENT 
()i~ 
~1 
COMMITTEE AMENDMENT "A .. to H.P. 1257, L.D. 1751 
In determining need, the period of time used as a basis for the calculation is the 30-day 
period commencing on the date of the application. This prospective calculation does not 
disqualify an applicant who has exhausted income to purchase basic necessities if that 
income does not exceed the income standards established by the municipality. 
Notwithstanding this prospective calculation, if any applicant or recipient receives a lump 
sum payment prior or subsequent to applying for assistance, that payment must be 
prorated over future months. The period of proration is determined by disregarding any 
portion of the lump sum payment that the applicant or recipient has spent to purchase 
basic necessities, including but not limited to: all basic necessities provided by general 
assistance; reasonable payment of funeral or burial expenses for a family member; 
reasonable travel costs related to the illness or death of a family member; repair or 
replacement of essentials lost due to fire, flood or other natural disaster; repair or 
purchase of a motor vehicle essential for employment, education, training or other day-to-
day living necessities; repayments of loans or credit, the proceeds of which can be 
verified as having been spent on basic necessities; and payment of bills earmarked for the 
purpose for which the lump sum is paid. All income received by the household between 
the receipt of the lump sum payment and the application for assistance is added to the 
remainder of the lump sum. The period of proration is then determined by dividing the 
remainder of the lump sum payment by the verified actual monthly amounts for all of the 
household's basic necessities. 
That dividend represents the period of proration 
determined by the administrator to commence on the date of receipt of the lump sum 
payment. 
The prorated sum for each month must be considered available to the 
household for 12 months from the date of application or during the period of proration, 
whichever is less. 
Sec. 2. 36 MRSA §5219-II, first~, as enacted by PL 2013, c. 368, Pt. L, §l, is 
amended to read: 
For tax years beginning on or after January 1, 2013 and before January 1, 2014, a 
Maine resident individual is allowed a property tax fairness credit as computed under this 
section against the taxes imposed under this Part. 
Sec. 3. 36 MRSA §5219-KK is enacted to read: 
§5219-KK. Property tax fairness credit for tax years beginning on or after January 
1,2014 
For tax years beginning on or after January 1, 2014, a Maine resident individual is 
allowed a property tax fairness credit as computed under this section against the taxes 
imposed under this Part. 
1. Definitions. As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings. 
A. "Benefit base" means property taxes paid by a resident individual during the tax 
year on the resident individual's homestead in this State or rent constituting property 
taxes paid by the resident individual during the tax year on a homestead in the State 
not exceeding the following amounts: 
(1) For persons filing as single individuals, $2,000; 
COMMITTEE AMENDMENT 
~ 
\)i~ 
COMMITTEE AMENDMENT "A" to H.P. 1257, L.D. 1751 
(2) For persons filing joint returns or as heads of households that claim no more 
than 2 personal exemptions, $2,600; 
(3) For persons filing joint returns or as heads of households that claim 3 or more 
personal exemptions, $3,200; and 
(4) For married individuals filing separate returns, 1/2 of the amount under 
subparagraph (2) or (3), whichever would apply if the individual had filed a joint 
return for the taxable year with the individual's spouse. 
B. "Dwelling" means an individual house or apartment, duplex unit, cooperative unit, 
condominium unit, mobile home or mobile home pad. 
e. "Homestead" means the dwelling owned or rented by a taxpayer or held in a 
revocable living trust for the benefit of the taxpayer and occupied by the taxpayer and 
the taxpayer's dependents as a home and may consist of a part of a multidwelling or 
mUltipurpose building and a part of the land, up to 10 acres, upon which it is built. 
For purposes of this paragraph, "owned" includes a vendee in possession under a land 
contract, one or more joint tenants or tenants in common and possession under a 
legally binding agreement that allows the owner of the dwelling to transfer the 
property but continue to occupy the dwelling as a home until some future event stated 
in the agreement. 
D. 
"Income" means federal adjusted gross income increased by the following 
amounts: 
(1) 
Trade or business losses; capital losses; any net loss resulting from 
combining the income or loss from rental real estate and royalties, the income or 
loss from partnerships and S corporations, the income or loss from estates and 
trusts, the income or loss from real estate mortgage investment conduits and the 
net farm rental income or loss; any loss associated with the sale of business 
property; and farm losses included in federal adjusted gross income; 
(2) Interest received to the extent not included in federal adjusted gross income; 
(3) 
Payments received under the federal Social Security Act and railroad 
retirement benefits to the extent not included in federal adjusted gross income; 
and 
(4) The following amounts deducted in arriving at federal adjusted gross income: 
(a) Educator expenses pursuant to the Code, Section 62(a)(2)(D); 
(b) Certain business expenses of performing artists pursuant to the Code, 
Section 62(a)(2)(B); 
(c) Certain business expenses of government officials pursuant to the Code, 
Section 62(a)(2)(C); 
(d) Certain business expenses of reservists pursuant to the Code, Section 
62(a)(2)(E); 
COMMITTEE AMENDMENT 
\)i~ 
~ 
COMMITTEE AMENDMENT "A" to H.P. 1257, L.D. 1751 
(e) 
Health savings account deductions pursuant to the Code, Section 
62(a)(16) and Section 62(a)(19); 
(Q Moving expenses pursuant to the Code, Section 62(a)(15); 
(g) The deductible part of self-employment tax pursuant to the Code, Section 
lMll1 
(h) 
The deduction for self-employed SEP, SIMPLE and qualified plans 
pursuant to the Code, Section 62(a)(6); 
(i) 
The self-employed health insurance deduction pursuant to the Code, 
Section 162(1); 
(j) The penalty for early withdrawal of savings pursuant to the Code, Section 
62(a)(9); 
(k) Alimony paid pursuant to the Code, Section 62(a)( 1 0); 
(I) The IRA deduction pursuant to the Code, Section 62(a)(7); 
em) 
The student loan interest deduction pursuant to the Code, Section 
62(a)(l7); 
(n) The tuition and fees deduction pursuant to the Code, Section 62(a)(18); 
and 
(0) 
The domestic production activities deduction pursuant to the Code, 
Section 199. 
E. "Rent constituting property taxes" means 15% of the gross rent actually paid in 
cash or its equivalent during the tax year solely for the right of occupancy of a 
homestead in the State. For the purposes of this paragraph, "gross rent" means rent 
paid at arm's length solely for the right of occupancy of a homestead, exclusive of 
charges for any utilities, services, furniture, furnishings or personal property 
appliances furnished by the landlord as part of the rental agreement, whether or not 
expressly set out in the rental agreement. If the landlord and tenant have not dealt 
with each other at arm's length, and the assessor is satisfied that the gross rent 
charged was excessive, the assessor may adjust the gross rent to a reasonable amount 
for purposes of this section. 
2. Credit. A resident individual is allowed a credit against the taxes imposed under 
this Part in an amount equal to 50% of the amount by which the benefit base for the 
resident individual exceeds 6% of the resident individual's income. The credit may not 
exceed $600 for resident individuals under 65 years of age as of the last day of the 
taxable year or $900 for resident individuals 65 years of age and older as of the last day 
of the taxable year. In the case of married individuals filing a joint return, only one 
spouse is required to be 65 years of age or older to qualify for the $900 credit limitation. 
In the case of resident married individuals filing separate returns, each of whom claims 
the credit on the same homestead, the credit for each spouse may not exceed $300 if, for 
the taxable year, neither spouse was a resident individual 65 years of age or older or $450 
if, for the taxable year, at least one spouse was 65 years of age or older. 
COMMITTEE AMENDMENT 
\)i~ 
~ 
COMMITTEE AMENDMENT 'A" to H.P. 1257, L.D. 1751 
3. Refundability of credit. The tax credit under this section is refundable after the 
application of nonrefundable credits. 
Sec. 4. 36 MRSA §5403, as amended by PL 2013, c. 368, Pt. Q, §11 and affected 
by § 12 and amended by Pt. TT, § 19, is repealed and the following enacted in its place: 
§5403. Annual adjustments for inflation 
Beginning in 2015, and each calendar year thereafter, on or about September 15th, 
the assessor shall multiply the cost-of-living adjustment for taxable years beginning in the 
succeeding calendar year by the dollar amounts of the tax rate tables specified in section 
5111, subsections 1-D, 2-D and 3-D and of the benefit base amounts in section 5219-KK, 
subsection 1, paragraph A. Beginning in 2013, and each calendar year thereafter, on or 
about September 15th, the assessor shall multiply the cost-of-living adjustment for 
taxable years beginning in the succeeding calendar year by the dollar amount of the 
itemized deduction limitation amount in section 5125, subsection 4. If the benefit base 
amounts, itemized deduction limitation amount or the dollar amounts of each rate bracket, 
adjusted by application of the cost-of-living adjustment, are not multiples of $50, any 
increase must be rounded to the next lowest multiple of $50. If the cost-of-living 
adjustment for any taxable year would be less than the cost-of-living adjustment for the 
preceding calendar year, the cost-of-living adjustment is the same as for the preceding 
calendar year. The assessor shall incorporate such changes into the income tax forms, 
instructions and withholding tables for the taxable year. 
Sec. 5. Appropriations and allocations. 
The following appropriations and 
allocations are made. 
ADMINISTRATIVE AND FINANCIAL SERVICES, DEPARTMENT OF 
Revenue Services, Bureau of 0002 
Initiative: Provides one-time funding to implement changes to the property tax fairness 
credit. 
GENERAL FUND 
All Other 
GENERAL FUND TOTAL 
2013-14 
$0 
$0 
2014-15 
$124,650 
$124,650 
SUMMARY 
This amendment strikes the bill and makes the following changes to the Maine 
resident property tax fairness credit for tax years beginning on or after January 1,2014. 
The amendment changes the definition of "income" that is considered in determining 
eligibility for the credit by starting with an adjustment to federal adjusted gross income, 
corresponding to federal total income as reported on the individual's federal income tax 
return, increased by nontaxable social security and railroad retirement benefits, tax 
exempt interest, certain deductions and certain business and capital losses. 
COMMITTEE AMENDMENT 
~ 
\)i~ 
COMMITTEE AMENDMENT "A" to H.P. 1257,L.D. 1751 
The amendment changes the formula for calculating the amount of the credit by 
providing that benefits are equal to 50% of the amount by which the benefit base exceeds 
6% of the individual's income up to a maximum benefit of $600 for filers under 65 years 
of age and $900 for filers 65 years of age and older. The benefit base is the amount of 
property taxes or rent constituting property taxes up to a maximum of $2,000 for single 
filers, $2,600 for joint filers and head of household filers claiming no more than 2 
personal exemptions, $3,200 for joint filers and head of household filers claiming 3 or 
more personal exemptions and, for married individuals filing separately, 112 of the benefit 
base limitation amount applicable to married individuals filing jointly. 
The amendment changes the portion of rent constituting property taxes from 25% to 
15% and removes the exclusion of persons whose rent is subsidized by government 
programs. 
The amendment provides that the benefit base maximum amounts will be adjusted 
annually for inflation for tax years beginning after 2015. 
The amendment provides funding to cover administrative costs to implement the 
changes to the property tax fairness credit. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: 03/27114 
~ac 
LD 1751 
LR 2258(02) 
An Act To Provide Property Tax Relief to Maine Residents 
Fiscal Note for Bill as Amended by Committee Amendment 1\:' l H -7f55 ") 
Committee: Taxation 
Net Cost (Savings) 
General Fund 
Appropriations/Allocations 
General Fund 
Revenue 
General Fund 
Other Special Revenue Funds 
Fiscal Detail and Notes 
Fiscal Note Required: Yes 
Fiscal Note 
FY 2013-14 
$0 
$0 
$0 
$0 
FY 2014-15 
($326,600) 
$124,650 
$451,250 
$23,750 
Projections 
FY 2015-16 
($123,876) 
$0 
$123,876 
$6,520 
Projections 
FY 2016-17 
$211,896 
$0 
($211,896) 
($11,152) 
This bill makes various changes to the property tax fairness credit and would result in an increase in General Fund and 
Local Government Fund revenue of$451,250 and 23,750, respectively, in fiscal year 2014-15. The bill includes a 
General Fund appropriation to the Department of Administrative and Financial Services of $124,650 in fiscal year 
2014-15 for administrative costs associated with these changes. 
LR2258(02) - Fiscal Note - Page 1 of 1