An Act To Replace the Educational Opportunity Tax Credit with the Student Loan Repayment Credit for Maine Residents
Maine Legislature, Session 128, LD 1537
Committee Amendment CA_A_H710 (House)
Amends: 36 MRSA §199-C, 36 MRSA §2535, 36 MRSA §5122

COMMITTEE AMENDMENT "A" to H.P. 1057, L.D. 1537, Bill, "An Act To 
Replace the Educational Opportunity Tax Credit with the Student Loan Repayment 
Credit for Maine Residents" 
Amend the bill in section 2 in subsection 8 in the 3rd line (page 1, line 12 in L.D.) by 
striking out the following: 
112017
and inserting the following: '2019' 
Amend the bill in section 3 in subsection 9 in the 3rd line (page 1, line 18 in L.D.) by 
striking out the following: 
112017
and inserting the following: 120191 
Amend the bill by inserting after section 3 the following: 
'Sec. 4. 36 MRSA §199-C, sub-§3, as amended by PL 2015, c. 328, §2, is further 
amended to read: 
3. Specific tax expenditure review. By June 1, 2021, the committee shall review 
the income tax credit under section sections 5217-D and 5217-E to determine whether the 
credit should be retained, repealed or modified. The committee shall consider information 
provided by the Office of Tax Policy within the bureau and the Department of Education 
pursuant to Title 20-A, section 12545. 
Sec. 5. 36 MRSA §2535, as enacted by PL 2017, c. 211, Pt. C, §1, is amended to 
read: 
§2535. Credit for educational opportunity 
A taxpayer is allowed a credit against the tax otherwise due under this chapter as 
determined under section 5217-D or 5217-E. 
Sec. 6. 36 MRSA §5122, sub-§2, WF, as amended by PL 2013, c. 525, §14, is 
further amended to read: 
FF. To the extent included in federal adjusted gross income, student loan payments 
made by the taxpayer's employer directly to a lender on behalf of a qualified 
employee in accordance with section 5217-D or 5217-E, whether or not the employer 
COMMITTEE AMENDMENT 
~· 
d-"->· 
COMMITTEE AMENDMENT .. ft., to H.P. 1057, L.D. 1537 
claims, or could claim, the credit provided by section 5217-D, subsection 5 or section 
5217-E, subsection 4; 
Sec. 7. 36 MRSA §5122, sub-§2, ~N, as amended by PL 2015, c. 388, Pt. A, 
§ 7, is further amended to read: 
NN. For taxable years beginning on or after January 1, 2015, 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 2014 for which an 
addition was required under subsection 1, paragraph II, subparagraph (2) for the 
taxable year beginning in 2014. 
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 II, 
subparagraph (2) and the subtraction modifications allowed pursuant to this 
paragraph. 
The total amount of subtraction claimed under this paragraph for all tax years may 
not exceed the addition modification under subsection 1, paragraph II, subparagraph 
(2) for the same property; arui 
Sec. 8. 36 MRSA §5122, sub-§2, ,roo, as enacted by PL 2015, c. 388, Pt. A, §8, 
is amended to read: 
00. For taxable years beginning on or after January 1, 2016, 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 for which an addition was required 
under subsection 1, paragraph KK, subparagraph (2) for the taxable year. 
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 KK, 
subparagraph (2) and the subtraction modifications allowed pursuant to this 
paragraph. 
The total amount of subtraction claimed under this paragraph for all tax years may 
not exceed the addition modification under subsection 1, paragraph KK, 
subparagraph (2) for the same property,; and 
Sec. 9. 36 MRSA §5122, sub-§2, ,rPP is enacted to read: 
PP. To the extent included in federal adjusted gross income, student loan payments 
made directly to a lender on behalf of the taxpayer by a student loan repayment 
program funded by a nonprofit foundation and administered by the Finance Authority 
of Maine for residents of the State employed by a business located in the State.' 
COMMITTEE AMENDMENT 
~S· 
~· '5 
COMMITTEE AMENDMENT ,.,q.,, to H.P. 1057, L.D. 1537 
Amend the bill in section 4 in subsection 6 in the last line (page 1, line 23 in L.D.) by 
striking out the following: 
112017
and inserting the following: '2019' 
Amend the bill in section 5 in §5217-E by striking out all of the first indented 
paragraph (page 1, lines 26 to 28 in L.D.) and inserting the following: 
'For tax years beginning on or after January 1. 2019, a qualified individual or the 
employer of a qualified employee is allowed a credit for student loan repayments as 
computed under this section against the taxes imposed under this Part,' 
Amend the bill in section 5 in §5217-E in subsection 1 in paragraph H by striking out 
all of subparagraph (3) (page 2, lines 31 to 39 in L.D.) and inserting the following: 
'(3) Meets one of the following conditions: 
(a) The individual worked during the taxable year: 
(i) At least part time in this State for an employer or as a self-employed 
individual: or 
(ii) At least part time in a position on a vessel at sea: 
(b) The individual was deployed for military service in the United States 
Armed Forces, including the National Guard and the Reserves of the United 
States Armed Forces. 
As used in this division, "deployed for military 
service" has the same meaning as in Title 26, section 814, subsection 1. 
paragraph A: or 
(c) The individual was a spouse of an individual who meets the requirements 
of either division (a) or division (b).' 
Amend the bill in section 5 in §5217-E in subsection 3 by striking out all of 
paragraph B (page 3, lines 34 to 36 in L.D.) and inserting the following: 
'B. Fifteen percent of the outstanding eligible education loan debt determined on the 
date the first education loan payment is made after the degree is earned.' 
Amend the bill in section 5 in §5217-E by striking out all of subsection 4 (page 3, 
lines 37 to 43 and page 4, lines 1 to 3 in L.D.) and inserting the following: 
'4. Calculation of the credit; employers. Subject to subsection 2, the credit with 
respect to a taxpayer constituting an employer making payments on eligible education 
loans directly to a lender during the taxable year on behalf of a qualified employee is 
equal to the lesser of: 
A. The amount paid by the employer on behalf of the qualified employee on eligible 
education loans during the taxable year during the term of employment: and 
B. Twenty percent of the outstanding eligible education loan debt determined on the 
date of the first education loan payment made after December 31, 2018. 
If the qualified employee is employed on a part-time basis during the taxable year, the 
credit with respect to that employee is limited to 50% of the credit otherwise determined 
under this subsection.' 
Amend the bill by inserting after section 5 the following: 
COMMITTEE AMENDMENT 
~ 
~ c.,. 
COMMITIEE AMENDMENT" A» to H.P. 1057, L.D. 1537 
'Sec. 6. Application. Those sections of this Act that amend the Maine Revised 
Statutes, Title 36, section 5122, subsection 2, paragraph FF and that enact Title 36, 
section 5122, subsection 2, paragraph PP apply to tax years beginning on or after January 
1, 2019.' 
Amend the bill by relettering or renumbering any nonconsecutive Part letter or 
section number to read consecutively. 
SUMMARY 
This amendment changes the implementation of the new credit for student loan 
repayment to tax years beginning on or after January 1, 2019. The amendment changes 
the calculation of the credit for qualified individuals to the lesser of the amount paid on 
eligible education loans during the taxable year and 15% of the outstanding eligible 
education loan debt on the date the first education loan payment is made after a degree is 
earned. It changes the calculation of the credit for employers to the lesser of the amount 
paid by an employer on behalf of a qualified employee during the taxable year during the 
term of employment and 20% of the outstanding eligible education loan debt on the date 
the first education loan payment is made after December 31, 2018. The amendment 
provides that the credit is available to the spouse of an individual eligible for a credit even 
if the spouse is not employed. The amendment provides income tax deductions for 
student loan payments made directly to a lender by an employer on behalf of a qualified 
employee and payments made directly to a lender on behalf of a taxpayer by a student 
loan repayment program funded by a nonprofit foundation and administered by the 
Finance Authority of Maine for residents of the State employed by a business located in 
the State. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: 04/01/18 feac. 
LD 1537 
LR 726(02) 
An Act To Replace the Educational Opportunity Tax Credit with the Student Loan Repayment Credit 
for Maine Residents 
Fiscal Note for Bill as Amended by Committee Amendment '# 
Committee: Taxation 
CH-71 o) 
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 2017-18 
FY 2018-19 
Projections 
FY 2019-20 
Projections 
FY 2020-21 
$0 
$0 
$0 
$0 
$0 
$30,006,528 
$29,726,494 
$0 
$176,528 
$181,494 
$0 
($29,830,000) 
($29,545,000) 
$0 
($1,570,000) 
($1,555,000) 
This legislation replaces the educational opportunity tax credit with a student loan repayment credit for tax years 
beginning on or after January 1, 2019. It would result in a reduction in General Fund revenue of $29,830,000 and a 
reduction in Local Government Fund revenue of $1,570,000 in fiscal year 2019-20. The Department of 
Administrative and Financial Services will require a General Fund appropriation of $176,528 in fiscal year 2019-20 
for 2 Tax Examiner positions and related costs to analyze and process income tax returns. 
LR0726(02) - Fiscal Note - Page 1 of 1