An Act To Eliminate the Double Taxation of Out-of-state Pensions
Maine Legislature, Session 129, LD 1019
Committee Amendment CA_A_S230 (Senate)
Amends: 36 MRSA §5122, 36 MRSA §5403

COMMITTEE AMENDMENT " A-" to S.P. 298, L.D. 1019, Bill, "An Act To 
Eliminate the Double Taxation of Out-of-state Pensions" 
Amend the bill by striking out the title and substituting the following: 
'An Act To Increase the Maximum Pension Deduction for State Income Tax' 
Amend the bill by striking out everything after the enacting clause and inserting the 
following: 
'Sec. 1. 36 MRSA §5122, sub-§2, ,iM-2, as amended by PL 2017, c. 170, Pt. H, 
§3, is further amended to read: 
M-2. For tax years beginning on or after January 1, 2016: 
(1) For each individual who is a primary recipient ofretirement plan benefits, the 
reduction is the sum of: 
(a) Excluding military retirement plan. benefits, an amount that is the lesser 
of 
(i) The aggregate of retirement plan benefits under employee retirement 
plans or individual retirement accounts included in the individual's 
federal adjusted gross income; and 
(ii) The pension deduction amount reduced by the total amount of the 
individual's social security benefits and railroad retirement benefits paid 
by the United States, but not less than $0; and 
(b) An amount equal to the aggregate of retirement benefits under military 
retirement plans included in the individual's federal adjusted gross income; 
and 
(2) For purposes of this paragraph, the following terms have the following 
meanings. 
COMMITTEE AMENDMENT 
~J 
COMMITTEE AMENDMENT" 1-\ "to S.P. 298, L.D. 1019 ( ~-) ) ))\.._ \ 
(a) "Employee retirement plan" means a state, federal or military retirement 
plan or any other retirement benefit plan established and maintained by an 
employer for the benefit of its employees under the Code, Section 401(a), 
Section 403 or Section 457(b), except that distributions made pursuant to a 
Section 457(b) plan are not eligible for the deduction provided by this 
paragraph if they are made prior to age 55 and are not part of a series of 
substantially equal periodic payments made for the life of the primary 
recipient or the joint lives of the primary recipient and that recipient's 
designated beneficiary. 
(b) "Individual retirement account" means an individual retirement account 
under Section 408 of the Code, a Roth IRA under Section 408A of the Code, 
a simplified employee pension under Section 408(k) of the Code or a simple 
retirement account for employees under Section 408(p) of the Code. 
( c) "Military retirement plan" means retirement plan benefits received as a 
result of service in the active or reserve components of the United States 
Army, Navy, Air Force, Marines or Coast Guard. 
(d) "Pension deduction amount" means $10,000, except that, for tax years 
beginning on or after January 1, 2019 but before January 1, 2024, "pension 
deduction amount" means the pension deduction amount applicable to the 
preceding tax year increased by $5,000. For tax years beginning on or after 
January 1, 2024, "pension deduction amount" means $35,000. 
( e) 
"Primary recipient" means the individual upon whose earnings or 
contributions the retirement plan benefits are based or the surviving spouse of 
that individual. 
(f) 
"Retirement plan benefits" means employee retirement plan benefits, 
except pick-up contributions for which a subtraction is allowed under 
paragraph E, reported as pension or annuity income for federal income tax 
purposes and individual retirement account benefits reported as individual 
retirement account distributions 
for 
federal 
income tax purposes. 
"Retirement plan benefits" does not include distributions that are subject to 
the tax imposed by the Code, Section 72(t); 
Sec. 2. 36 MRSA §5403, sub-§§7 and 8, as enacted by PL 2017, c. 474, Pt. B, 
§24, are amended to read: 
7. Personal exemptions. Beginning in 2018 and each year thereafter, by the dollar 
amounts contained in section 5126-A, subsection 1, except that for the purposes of this 
subsection, notwithstanding section 5402, subsection 1-B, the "cost-of-living adjustment" 
is the Chained Consumer Price Index for the 12-month period ending June 30th of the 
preceding calendar year divided by the Chained Consumer Price Index for the 12-month 
period ending June 30, 2017; iHl6 
8. Personal exemption phase-out. Beginning in 2018 and each year thereafter, by 
the dollar amount of the applicable amounts specified in section 5126-A, subsection 2, 
paragraphs A, B and C, except that for the purposes of this subsection, notwithstanding 
section 5402, subsection 1-B, the "cost-of-living adjustment" is the Chained Consumer 
COMMITTEE AMENDMENT 
COMMITTEE AMENDMENT" fl" to S.P. 298, L.D. 1019 {c::,. )~~G') 
/ 
Price Index for the 12-month period ending June 30th of the preceding calendar year 
divided by the Chained Consumer Price Index for the 12-month period ending June 30, 
2017,; and 
Sec. 3. 36 MRSA §5403, sub-§9 is enacted to read: 
9. Pension deduction. Beginning in 2023 and each year thereafter, by the pension 
deduction amount defined in section 5122. subsection 2. paragraph M-2. subparagraph 
(2), division (d) with respect to tax years beginning on or after January 1. 2024. except 
that for the purposes of this subsection. notwithstanding section 5402. subsection 1-B. the 
"cost-of-living adjustment" is the Chained Consumer Price Index for the 12-month period 
ending June 30th of the preceding calendar year divided by the Chained Consumer Price 
Index for the 12-month period ending June 30. 2023.' 
Amend the bill by relettering or renumbering any nonconsecutive Part letter or 
section number to read consecutively. 
SUMMARY 
This amendment increases the maximum annual income tax pension deduction 
amount for nonmilitary retirement pensions from $10,000 to $35,000 over a 5-year period 
beginning with the 2019 tax year. The $35,000 pension deduction amount that applies 
after the 2023 tax year is subject to an annual inflation adjustment. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Net Cost (Savings) 
General Fund 
Revenue 
General Fund 
Approved: 04/12/19 feae 
LD 1019 
LR 1020(02) 
An Act To Eliminate the Double Taxation of Out-of-state Pensions 
Fiscal Note for Bill as Amended by Committee Amendment 'Yr'' Cc, ;,1.j C::) 
Committee: Taxation 
Fiscal Note Required: Yes 
Fiscal Note 
FY 2019-20 
FY2020-21 
$10,545,000 
$21,850,000 
Projections 
FY 2021-22 
$34,437,500 
Projections 
FY 2022-23 
$47,975,000 
($10,545,000) 
($21,850,000) 
($34,437,500) 
($47,975,0001 
Other Special Revenue Funds 
($555,000) 
($1,150,000) 
($1,812,500) 
($2,525,000, 
Fiscal Detail and Notes 
This bill increases the maximum annual income tax pension deduction amount for nonmilitary retirement pensions 
from $10,000 to $35,000 per year over a 5-year period beginning with the 2019 tax year. It reduces General Fund 
revenue by $10,545,000 in fiscal year 2019-20 and by $21,850,000 in fiscal year 2020-21 and reduces Local 
Government Fund revenue by $555,000 in fiscal year 2019-20 and by $1,150,000 in fiscal year 2020-21. 
LRl 020(02) - Fiscal Note - Page 1 of 1