An Act Regarding Levies Placed on Accounts at Financial Institutions for Unpaid State Income Taxes
Maine Legislature, Session 128, LD 1669
Committee: Taxation
Sponsors: FECTEAU
Amends: 36 MRSA §176-A

Legislative Document
No. 1669
H.P. 1155
House of Representatives, December 6, 2017
An Act Regarding Levies Placed on Accounts at Financial 
Institutions for Unpaid State Income Taxes
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
203.
Received by the Clerk of the House on December 4, 2017.  Referred to the Committee on 
Taxation pursuant to Joint Rule 308.2 and ordered printed pursuant to Joint Rule 401.
ROBERT B. HUNT
Clerk
Presented by Representative FECTEAU of Biddeford.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §176-A, sub-§3, ¶A, as amended by PL 2011, c. 380, Pt. J, 
§12, is further amended to read:
A.    Except as otherwise provided in paragraph B, any person who is in possession 
of, or obligated with respect to, property or rights to property subject to levy upon 
which a levy has been made shall, upon demand of the assessor, surrender the 
property or rights or discharge the obligation to the assessor within 21 days after 
receipt of the notice of levy, except that part of the property or rights that is, at the 
time of the demand, subject to an attachment or execution under judicial process.  It 
is a defense to the liability imposed by this subsection that the person who fails to 
comply with the terms of a notice of levy or that person's bailor has a valid claim 
against the delinquent taxpayer that accrued prior to receipt of the notice of levy or a 
valid security interest or lien upon the property of the taxpayer that was perfected 
prior to receipt of the notice of levy; but this defense is available only to the extent of 
that claim, security interest or lien.
Any financial institution chartered under state or federal law, including, but not 
limited to, trust companies, savings banks, savings and loan associations, national 
banks and credit unions, shall surrender to the assessor any deposits, including any 
interest in the financial institution that would otherwise be required to be surrendered 
under this subsection only after 21 days after receipt of the notice of levy, but not 
later than 30 days after receipt of the notice of levy.  Except as provided in subsection 
5, paragraph D, with respect to a levy on salary or wages, any person in possession 
of, or obligated with respect to, property subject to a continuing levy against 
intangible personal property, which property is first possessed or which obligation 
first arises subsequent to receipt of a notice of levy by that person, shall, upon 
demand of the assessor, surrender the property or rights, or discharge the obligation 
to the assessor within 30 days after the property is first possessed or the obligation 
first arises.
Any financial institution chartered under state or federal law, including, but not 
limited to, trust companies, savings banks, savings and loan associations, national 
banks and credit unions, shall surrender to the assessor any deposits subject to levy 
for the payment of taxes pursuant to Part 8 in the following order: 
(1)  Deposits in accounts held solely by the delinquent taxpayer;
(2)  Deposits in accounts held jointly by the delinquent taxpayer and the 
taxpayer’s spouse; and
(3)  Deposits in accounts held jointly by the delinquent taxpayer and a 3rd party.
SUMMARY
This bill requires a financial institution, in a case in which a delinquent taxpayer's 
accounts have been levied for unpaid state income taxes, to satisfy the levy first from 
accounts held solely by the delinquent taxpayer, next from accounts held jointly by the 
delinquent taxpayer and the delinquent taxpayer's spouse and last from accounts held 
jointly by the delinquent taxpayer and a 3rd party.