H.P. 40 - L.D. 45
Sec. I-1. 36 MRSA §5228, sub-§1, ¶D is enacted to read:
D. "Unusual event" means, with respect to that portion of the tax year applicable to the required installment, receipt by an individual taxpayer of taxable income that is not subject to withholding of Maine income tax when the amount exceeds the taxable income not subject to withholding of Maine income tax received by the taxpayer during the same period of the previous tax year by at least $500,000.
Sec. I-2. 36 MRSA §5228, sub-§2, as amended by PL 2007, c. 438, §106, is repealed and the following enacted in its place:
2. Requirement to pay estimated tax.
Every person subject to taxation under this Part shall make payment of estimated tax as required by this Part. The requirement to make estimated tax payments is waived if:
C. The person's tax liability pursuant to this Part, exclusive of a withholder's liability for taxes withheld, reduced by allowable credits for the taxable year, is less than $1,000 for the taxable year; or
D. The person had less than $1,000 tax liability under this Part for the preceding taxable year. This paragraph does not apply with respect to an unusual event.
Sec. I-3. 36 MRSA §5228, sub-§3, as amended by PL 2007, c. 438, §§107 and 108, is further amended to read:
3. Amount of estimated tax to be paid.
Every person required to make payment of estimated tax is liable for an estimated tax that is no less than the smaller of the following; paragraphs A and B, except that large corporations as defined in the Code, Section 6655(g), are subject only to paragraph B, except as provided in subsection 5, paragraph C and individual taxpayers encountering an unusual event are subject only to paragraph B with respect to the unusual event, except as provided in subsection 5, paragraph D:
A. An amount equal to the person's tax liability under this Part for the preceding taxable year, if that preceding year was a taxable year of 12 months; or
B. An amount equal to 90% of the person's tax liability under this Part for the current taxable year determined without taking into account the current year's investment tax credit set forth in section 5219-E, except that for farmers and persons who fish commercially, this amount is 66 2/3% of the person's tax liability under this Part for the current taxable year.
Sec. I-4. 36 MRSA §5228, sub-§5, ¶D is enacted to read:
D. The taxpayer encounters an unusual event. For purposes of the installment due with respect to that portion of the tax year during which an unusual event occurs, the taxpayer shall make an estimated tax payment pursuant to subsection 3, paragraph B equal to the amount of estimated tax with respect to the taxable income that results in the unusual event, plus the amount of estimated tax required by this section to be paid with respect to the installment on taxable income exclusive of that resulting in the unusual event.
Sec. I-5. 36 MRSA §5228, sub-§11 is enacted to read:
11. Unusual event; waiver of penalty; extension to pay.
With respect to an estimated tax payment related to an unusual event, the assessor shall waive the penalty under subsection 5 or grant a reasonable extension of time, not to extend past the original due date for the filing of the return for the tax year, to pay the estimated tax required under subsection 5, paragraph D if:
A. The taxpayer is an owner in a pass-through entity;
B. The taxpayer had no control over the distribution of the unusual event amount;
C. The taxpayer did not actually or constructively receive payment of the unusual event amount; and
D. The taxpayer pays the estimated tax related to the unusual event amount by the installment payment due date following the installment period during which the taxpayer actually or constructively receives payment of the unusual event amount.
Sec. I-6. Application. This Part applies to tax years beginning on or after January 1, 2009.