Sec. 1. 36 MRSA §5116 is enacted to read:

§5116.__Deferred and waived taxes for certain military personnel

Notwithstanding any other provision of this Title to the contrary, the following provisions apply to military persons serving in a combat zone.__For purposes of this section, "military person" means a member of the Armed Forces of the United States, and "combat zone" means a geographical area designated by the President of the United States as a combat zone during a specified period.

1.__Deferment of income tax return filing.__A resident of the State who is serving as a military person in a combat zone and the spouse of that military person are entitled to an income tax return filing extension during which time neither interest nor penalties accrue on any income tax owed by the military person or the spouse of the military person.__The extension is for the period during which the military person is stationed in a combat zone plus 6 months following the departure of the military person from the combat zone.

2.__Waiver of taxes.__The estate of a resident of this State serving as a military person who dies in a combat zone is entitled to a full waiver of Maine income taxes for the tax year in which the military person died.

3.__Rulemaking.__The bureau shall adopt rules to carry out the intent of this section.__Rules adopted pursuant to this subsection are routine technical rules pursuant to Title 5, chapter 375, subchapter 2-A.

SUMMARY

This bill provides an income tax return filing extension to military persons, and their spouses, stationed in a combat zone, as declared by the President of the United States. The extension is for the time the military person is stationed in a combat zone plus an additional 6 months following the departure of the military person from the combat zone. No penalties or interest accrue during the extension.

This bill also provides a waiver of income taxes owed by a military person for the tax year in which that person dies in a combat zone.