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An Act To Amend the Tax Laws To Strengthen Charitable Institutions, Encourage Home Ownership and Manage Medical Expenses
Be it enacted by the People of the State of Maine as follows:
Sec. 1. 36 MRSA §5122, sub-§1, ¶JJ, as enacted by PL 2015, c. 267, Pt. DD, §8, is amended to read:
 
JJ. For tax years beginning on or after January 1, 2016, an amount equal to the taxpayer base multiplied by the following fraction:
 
(1) For single individuals and married persons filing separate returns, the numerator is the taxpayer's Maine adjusted gross income less $70,000, except that the numerator may not be less than zero, and the denominator is $75,000. In no case may the fraction contained in this subparagraph produce a result that is more than one. The $70,000 amount used to calculate the numerator in this subparagraph must be adjusted for inflation in accordance with section 5403, subsection 34;
 
(2) For individuals filing as heads of households, the numerator is the taxpayer's Maine adjusted gross income less $105,000, except that the numerator may not be less than zero, and the denominator is $112,500. In no case may the fraction contained in this subparagraph produce a result that is more than one. The $105,000 amount used to calculate the numerator in this subparagraph must be adjusted for inflation in accordance with section 5403, subsection 34; or
 
(3) For individuals filing married joint returns or surviving spouses, the numerator is the taxpayer's Maine adjusted gross income less $140,000, except that the numerator may not be less than zero, and the denominator is $150,000. In no case may the fraction contained in this subparagraph produce a result that is more than one. The $140,000 amount used to calculate the numerator in this subparagraph must be adjusted for inflation in accordance with section 5403, subsection 34.
 
For purposes of this paragraph, "taxpayer base" means either the taxpayer’s applicable standard deduction amount for the taxable year determined under section 5124-B or, if itemized deductions are claimed, the taxpayer’s itemized deductions claimed for the taxable year determined under section 5125.
 
This paragraph does not apply to a resident individual who has claimed itemized deductions from federal adjusted gross income in determining the individual's federal taxable income for the taxable year determined under section 5125.
Sec. 2. 36 MRSA §5125, sub-§2, as amended by PL 2013, c. 368, Pt. TT, §10 and affected by §20, is further amended to read:
 
2. Spouses.   Spouses, both of whom are required to file returns under this Part, are allowed to claim itemized deductions from Maine adjusted gross income only if both do so. Their total itemized deductions from federal adjusted gross income, as modified by subsection 3, may be taken by either spouse or divided between them, as they may elect, if their federal income tax is determined on a joint return but their tax under this Part is determined on separate returns. The total itemized deductions from Maine adjusted gross income claimed on a return may not exceed the limitation amount in subsection 4.
Sec. 3. 36 MRSA §5125, sub-§4, as amended by PL 2013, c. 595, Pt. T, §1 and affected by §2, is repealed.
Sec. 4. 36 MRSA §5403, sub-§3, as enacted by PL 2015, c. 267, Pt. DD, §33, is repealed.
 
SUMMARY
This bill allows a resident individual who itemizes deductions in determining federal adjusted gross income to claim those deductions to the full extent allowed under federal law in determining Maine adjusted gross income.