An Act to Ensure Consistency of Income Tax Deductions for Retired
Maine Legislature, Session 132, LD 0366
Sponsors: FARRIN, DAUGHTRY
Amends: 36 MRSA §5122

Legislative Document
No. 366
S.P. 158
In Senate, February 3, 2025
An Act to Ensure Consistency of Income Tax Deductions for Retired 
Members of the Uniformed Services
Received by the Secretary of the Senate on January 30, 2025.  Referred to the Committee 
on Taxation pursuant to Joint Rule 308.2 and ordered printed.
DAREK M. GRANT
Secretary of the Senate
Presented by Senator FARRIN of Somerset.
Cosponsored by Senators: President DAUGHTRY of Cumberland, HICKMAN of Kennebec, 
STEWART of Aroostook, TIMBERLAKE of Androscoggin, Representatives: FREDETTE of 
Newport, PARRY of Arundel, WADSWORTH of Hiram, ZAGER of Portland.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §5122, sub-§2, ¶M, as amended by PL 2017, c. 170, Pt. H, §1, 
is further amended by amending the first blocked paragraph to read:
For purposes of this paragraph, the following terms have the following meanings.  
"Primary recipient" means the individual upon whose earnings the employee retirement 
plan benefits are based or the surviving spouse of that individual.  "Pension benefits" 
means employee retirement plan benefits reported as pension or annuity income for 
federal income tax purposes.  "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 
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 years of age 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.  "Employee retirement plan" does not include 
an individual retirement account under Section 408 of the Code, a Roth IRA under 
Section 408A of the Code, a rollover individual retirement account, a simplified 
employee pension under Section 408(k) of the Code or an ineligible deferred 
compensation plan under Section 457(f) of the Code.  Pension benefits under an 
employee retirement plan do not include distributions that are subject to the tax 
imposed by the Code, Section 72(t).  "Military retirement plan" means 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 or Space Force; United States 
Department of Commerce, National Oceanic and Atmospheric Administration; or 
United States Public Health Service.
Sec. 2.  36 MRSA §5122, sub-§2, ¶M-2, as amended by PL 2023, c. 523, Pt. B, 
§1, is further amended by amending subparagraph (2), division (c) to read:
(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, Coast Guard or Space Force; United States 
Department 
of 
Commerce, 
National 
Oceanic 
and 
Atmospheric 
Administration; or United States Public Health Service.
SUMMARY
This bill includes benefits received as a result of service in the active or reserve 
components of the Space Force, the United States Department of Commerce, National 
Oceanic and Atmospheric Administration or the United States Public Health Service in the 
definition of "military retirement plan" for purposes of the pension benefit deduction in the 
income tax laws.