Code of Maine Rules › 18 - DEPARTMENT OF ADMINISTRATIVE AND FINANCIAL SERVICES › 125 - BUREAU OF REVENUE SERVICES › Chapter 825 - TRIBAL MEMBER INCOME FROM SOURCES ON TRIBAL LAND › Section 125-825-05 - Special sourcing rules

Current through 2024-29, July 17, 2024
A.
Allocation
				or apportionment required.
When a tribal member earns or derives income,
				including income from pass-through entities or sole proprietorships, from
				sources both on tribal land and elsewhere, an allocation or apportionment of
				the income must be made to determine the amount of income sourced to tribal
				land. The following provisions set forth the rules for the determination of a
				tribal member's income sourced to tribal land. For the purpose of this section,
				the term "income" includes, in the alternative, the term "loss." A tribal
				member may, with the return for the taxable year, request an alternative method
				of allocation or apportionment of income with a full explanation of the method.
				The proposed method is subject to review and modification by the Assessor.
				Allocation or apportionment of income from the rendering of purely personal
				services by employees, salespersons, athletes, and entertainers is addressed
				below.
B.
Employees
				generally.
When a tribal member employee establishes the exact amount of
				compensation received for services performed on tribal land, that amount is the
				amount of income sourced to tribal land. When a tribal member is unable to
				establish such exact determination of amounts earned on, or derived from,
				tribal land, the compensation must be apportioned to tribal land. The
				apportionment is calculated by multiplying the gross compensation wherever
				earned by a fraction, the numerator of which is the number of days spent
				working on tribal land and the denominator of which is the total working days.
The result is the amount of the tribal member's compensation
				  sourced to tribal land. Holidays, sick days, vacations, and paid or unpaid
				  leave are included in both the numerator and the denominator. When a working
				  day is spent working partly on tribal land and partly elsewhere, it is treated
				  as one-half of a day spent working on tribal land.
For purposes of this subsection, salaries and wages earned
				  while teleworking or working remotely on tribal land, whether for the
				  convenience of the tribal member employee or the employer, are items of income
				  derived from sources on tribal land. Conversely, salaries and wages earned
				  while teleworking or working remotely off tribal land, whether for the
				  convenience of the tribal member employee or the employer, are not items of
				  income derived from sources on tribal land.
C.
Salespersons.
Tribal land
				income of a tribal member who is a salesperson or whose compensation is based
				in whole or in part upon commissions is computed as follows: The gross income
				earned by the tribal member from sales everywhere is multiplied by a fraction,
				the numerator of which is the amount of sales made by the tribal member on
				tribal land and the denominator of which is the amount of sales made by the
				tribal member everywhere. For the purposes of this calculation, the "amount of
				sales" is determined under the same method by which the amount of sales is
				determined for purposes of calculating the tribal member's commissions. Sales
				are sourced to the location where the tribal member performs the activities in
				obtaining the order, not to the location of the formal acceptance of the
				contract.
D.
Professional
				Athletes.
1.
Exhibition and
				regular season games.
A tribal member who is a professional athlete must
				include in the income sourced to tribal land the entire amount of compensation
				received for games played on tribal land. In the case of a tribal member
				athlete not paid specifically for the game played on tribal land, the following
				apportionment formula must be used: The income earned on tribal land is the
				total compensation earned during the taxable year, including incentive
				payments, bonuses, and extras, but excluding signing bonuses and league playoff
				money. Total compensation is multiplied by a fraction, the numerator of which
				is the number of exhibition and regular season games the tribal member played
				(or was available to play for the tribal member's team, as, for example, with
				substitutes) on tribal land during the taxable year, and the denominator of
				which is the total number of exhibition and regular season games that the
				tribal member was obligated to play under contract or otherwise during the
				taxable year, including games in which the tribal member was excused from
				playing because of injury or illness.
2.
Playoff games.
For playoff
				games played on tribal land, the amount of league playoff money earned by the
				tribal member for playing or being available to play in such games is
				determined by the following formula: League playoff money earned on tribal land
				is the total league playoff compensation earned during the taxable year
				multiplied by a fraction, the numerator of which is the number of playoff games
				the tribal member played or was available to play on tribal land during the
				taxable year, and the denominator of which is the total number of playoff games
				which the tribal member's team played during the taxable year, including
				playoff games in which the tribal member was excused from playing because of
				injury or illness.
3.
Signing
				bonuses.
Any amount received by a tribal member as a signing bonus is
				excluded from the income subject to apportionment.