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Amend the bill in section 2 in subsection 8 in the 3rd line (page 1, line 12 in L.D.) by striking out the following: "2017" and inserting the following: '2019'
Amend the bill in section 3 in subsection 9 in the 3rd line (page 1, line 18 in L.D.) by striking out the following: "2017" and inserting the following: '2019'
Amend the bill by inserting after section 3 the following:
‘Sec. 4. 36 MRSA §199-C, sub-§3, as amended by PL 2015, c. 328, §2, is further amended to read:
 
3. Specific tax expenditure review.   By June 1, 2021, the committee shall review the income tax credit under sectionsections 5217-D and 5217-E to determine whether the credit should be retained, repealed or modified. The committee shall consider information provided by the Office of Tax Policy within the bureau and the Department of Education pursuant to Title 20-A, section 12545.
Sec. 5. 36 MRSA §2535, as enacted by PL 2017, c. 211, Pt. C, §1, is amended to read:
§ 2535.Credit for educational opportunity
A taxpayer is allowed a credit against the tax otherwise due under this chapter as determined under section 5217-D or 5217-E.
Sec. 6. 36 MRSA §5122, sub-§2, ¶FF, as amended by PL 2013, c. 525, §14, is further amended to read:
 
FF. To the extent included in federal adjusted gross income, student loan payments made by the taxpayer's employer directly to a lender on behalf of a qualified employee in accordance with section 5217-D or 5217-E, whether or not the employer claims, or could claim, the credit provided by section 5217-D, subsection 5 or section 5217-E, subsection 4;
Sec. 7. 36 MRSA §5122, sub-§2, ¶NN, as amended by PL 2015, c. 388, Pt. A, §7, is further amended to read:
 
NN. For taxable years beginning on or after January 1, 2015, an amount equal to the net increase in the depreciation deduction allowable under the Code, Sections 167 and 168 that would have been applicable to that property had the depreciation deduction under the Code, Section 168(k) not been claimed with respect to such property placed in service during the taxable year beginning in 2014 for which an addition was required under subsection 1, paragraph II, subparagraph (2) for the taxable year beginning in 2014.
 
Upon the taxable disposition of property to which this paragraph applies, the amount of any gain or loss includable in federal adjusted gross income must be adjusted for Maine income tax purposes by an amount equal to the difference between the addition modification for such property under subsection 1, paragraph II, subparagraph (2) and the subtraction modifications allowed pursuant to this paragraph.
 
The total amount of subtraction claimed under this paragraph for all tax years may not exceed the addition modification under subsection 1, paragraph II, subparagraph (2) for the same property; and
Sec. 8. 36 MRSA §5122, sub-§2, ¶OO, as enacted by PL 2015, c. 388, Pt. A, §8, is amended to read:
 
OO. For taxable years beginning on or after January 1, 2016, an amount equal to the net increase in the depreciation deduction allowable under the Code, Sections 167 and 168 that would have been applicable to that property had the depreciation deduction under the Code, Section 168(k) not been claimed with respect to such property placed in service during the taxable year for which an addition was required under subsection 1, paragraph KK, subparagraph (2) for the taxable year.
 
Upon the taxable disposition of property to which this paragraph applies, the amount of any gain or loss includable in federal adjusted gross income must be adjusted for Maine income tax purposes by an amount equal to the difference between the addition modification for such property under subsection 1, paragraph KK, subparagraph (2) and the subtraction modifications allowed pursuant to this paragraph.
 
The total amount of subtraction claimed under this paragraph for all tax years may not exceed the addition modification under subsection 1, paragraph KK, subparagraph (2) for the same property.; and
Sec. 9.  36 MRSA §5122, sub-§2, ¶PP  is enacted to read:
 
PP. To the extent included in federal adjusted gross income, student loan payments made directly to a lender on behalf of the taxpayer by a student loan repayment program funded by a nonprofit foundation and administered by the Finance Authority of Maine for residents of the State employed by a business located in the State.’
Amend the bill in section 4 in subsection 6 in the last line (page 1, line 23 in L.D.) by striking out the following: "2017" and inserting the following: '2019'
Amend the bill in section 5 in §5217-E by striking out all of the first indented paragraph (page 1, lines 26 to 28 in L.D.) and inserting the following:
‘
For tax years beginning on or after January 1, 2019, a qualified individual or the employer of a qualified employee is allowed a credit for student loan repayments as computed under this section against the taxes imposed under this Part.’
Amend the bill in section 5 in §5217-E in subsection 1 in paragraph H by striking out all of subparagraph (3) (page 2, lines 31 to 39 in L.D.) and inserting the following:
‘
 
(3) Meets one of the following conditions:
 
(a) The individual worked during the taxable year:
 
(i) At least part time in this State for an employer or as a self-employed individual; or
 
(ii) At least part time in a position on a vessel at sea;
 
(b) The individual was deployed for military service in the United States Armed Forces, including the National Guard and the Reserves of the United States Armed Forces. As used in this division, "deployed for military service" has the same meaning as in Title 26, section 814, subsection 1, paragraph A; or
 
(c) The individual was a spouse of an individual who meets the requirements of either division (a) or division (b).
Amend the bill in section 5 in §5217-E in subsection 3 by striking out all of paragraph B (page 3, lines 34 to 36 in L.D.) and inserting the following:
 
‘B. Fifteen percent of the outstanding eligible education loan debt determined on the date the first education loan payment is made after the degree is earned.’
Amend the bill in section 5 in §5217-E by striking out all of subsection 4 (page 3, lines 37 to 43 and page 4, lines 1 to 3 in L.D.) and inserting the following:
 
‘4.  Calculation of the credit; employers.     Subject to subsection 2, the credit with respect to a taxpayer constituting an employer making payments on eligible education loans directly to a lender during the taxable year on behalf of a qualified employee is equal to the lesser of:
 
A.  The amount paid by the employer on behalf of the qualified employee on eligible education loans during the taxable year during the term of employment; and
 
B.  Twenty percent of the outstanding eligible education loan debt determined on the date of the first education loan payment made after December 31, 2018.
 
If the qualified employee is employed on a part-time basis during the taxable year, the credit with respect to that employee is limited to 50% of the credit otherwise determined under this subsection.’
Amend the bill by inserting after section 5 the following:
‘Sec. 6. Application. Those sections of this Act that amend the Maine Revised Statutes, Title 36, section 5122, subsection 2, paragraph FF and that enact Title 36, section 5122, subsection 2, paragraph PP apply to tax years beginning on or after January 1, 2019.’
Amend the bill by relettering or renumbering any nonconsecutive Part letter or section number to read consecutively.
 
SUMMARY
This amendment changes the implementation of the new credit for student loan repayment to tax years beginning on or after January 1, 2019. The amendment changes the calculation of the credit for qualified individuals to the lesser of the amount paid on eligible education loans during the taxable year and 15% of the outstanding eligible education loan debt on the date the first education loan payment is made after a degree is earned. It changes the calculation of the credit for employers to the lesser of the amount paid by an employer on behalf of a qualified employee during the taxable year during the term of employment and 20% of the outstanding eligible education loan debt on the date the first education loan payment is made after December 31, 2018. The amendment provides that the credit is available to the spouse of an individual eligible for a credit even if the spouse is not employed. The amendment provides income tax deductions for student loan payments made directly to a lender by an employer on behalf of a qualified employee and payments made directly to a lender on behalf of a taxpayer by a student loan repayment program funded by a nonprofit foundation and administered by the Finance Authority of Maine for residents of the State employed by a business located in the State.
FISCAL NOTE REQUIRED
(See attached)