An Act to Establish the Electricity Cost Fairness Refundable Tax
Maine Legislature, Session 132, LD 2078
Committee: Taxation
Sponsors: WEBB, TIPPING
Amends: 36 MRSA §5213-B, 36 MRSA §5403

Legislative Document
No. 2078
H.P. 1393
House of Representatives, January 7, 2026
An Act to Establish the Electricity Cost Fairness Refundable Tax 
Credit
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
203.
Reference to the Committee on Taxation suggested and ordered printed.
ROBERT B. HUNT
Clerk
Presented by Representative WEBB of Durham.
Cosponsored by Senator TIPPING of Penobscot and
Representatives: CLUCHEY of Bowdoinham, EATON of Deer Isle, FARRIN of Jefferson, 
FROST of Belgrade, TERRY of Gorham, Senator: BICKFORD of Androscoggin.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  36 MRSA §5213-B is enacted to read:
§5213-B.  Electricity cost fairness credit
For tax years beginning on or after January 1, 2026, individuals are allowed a 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.  "Base credit" means:
(1)  For single individuals, $335; and
(2)  For individuals filing joint returns or as heads of households, $550 plus an 
additional amount equal to:
(a)  For individuals filing joint returns, $25 if they can claim the federal child 
tax credit pursuant to the Code, Section 24 for no more than one qualifying 
child or dependent or $50 if they can claim the credit for more than one 
qualifying child or dependent; or
(b)  For individuals filing as heads of households, $25 if they can claim the 
federal child tax credit pursuant to the Code, Section 24 for 2 qualifying 
children or dependents or $50 if they can claim the credit for more than 2 
qualifying children or dependents.
B.  "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);
(e)  Health savings account deductions pursuant to the Code, Section 62(a)(16) 
and Section 62(a)(19);
(f)  Moving expenses pursuant to the Code, Section 62(a)(15);
(g)  The deductible part of self-employment tax pursuant to the Code, Section 
164(f);
(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(l);
(j)  The penalty for early withdrawal of savings pursuant to the Code, Section 
62(a)(9);
(k)  The IRA deduction pursuant to the Code, Section 62(a)(7); and
(l)  The student loan interest deduction pursuant to the Code, Section 62(a)(17). 
2.  Credit for resident taxpayer.  A resident individual is allowed a credit equal to the 
applicable base credit amount, subject to the phase-out provisions under subsection 4.
3.  Credit for part-year resident taxpayer.  A taxpayer who files a return as a part-
year resident in accordance with section 5224‑A is allowed a credit equal to the applicable 
base credit amount, subject to the phase-out provisions under subsection 4, multiplied by a 
ratio, the numerator of which is the individual's income as modified by section 5122 for 
that portion of the taxable year during which the individual was a resident plus the 
individual's income from sources within this State, as determined under section 5142, for 
that portion of the taxable year during which the individual was a nonresident and the 
denominator of which is the individual's entire income, as modified by section 5122.
4.  Phase-out of credit.  The credit allowed under this section is phased out as follows.
A.  For single individuals, the credit is reduced by $27 for every $500 or portion thereof 
that exceeds $20,000 of the income.
B.  For unmarried individuals or legally separated individuals who qualify as heads of 
households, the credit is reduced by $40 for every $750 or portion thereof that exceeds 
$30,000 of the income. 
C.  For individuals filing married joint returns or surviving spouses permitted to file 
joint returns, the credit is reduced by $53 for every $1,000 or portion thereof that 
exceeds $40,000 of the income. 
5.  Refundability of credit.  The tax credit allowed under this section is refundable.
6.  Limitations.  The following individuals do not qualify for the credit under this 
section:
A.  Married taxpayers filing separate returns; 
B.  Individuals who do not qualify as resident individuals because they do not meet the 
requirements of section 5102, subsection 5, paragraph A; or 
C.  Individuals who may be claimed as a dependent on another taxpayer's return. 
Sec. 2.  36 MRSA §5403, sub-§6-A is enacted to read:
6-A.  Electricity cost fairness credit.  For the electricity cost fairness credit: 
A. Beginning in 2027 and each year thereafter, by the base credit amounts in section 
5213‑B, subsection 1, paragraph A, including the additional amounts in section 
5213-B, subsection 1, paragraph A, subparagraph (2), divisions (a) and (b), except that 
for the purposes of this paragraph, 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, 2026. If the base credit 
amount, adjusted by application of the cost-of-living adjustment, is not a multiple of 
$5, any increase must be rounded to the next lowest multiple of $5; and
B. Beginning in 2027 and each year thereafter, by the dollar amount of the income 
thresholds set forth in section 5213‑B, subsection 4, except that for the purposes of this 
paragraph, 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, 2026;
SUMMARY
This bill establishes the electricity cost fairness credit to provide a credit of up to $600 
against income taxes imposed on residents and part-year residents.  The credit, based on 
the sales tax fairness credit, is refundable, is phased out based on income and is indexed to 
inflation.