Sec. E-1. 36 MRSA §5219-N is enacted to read:
§5219-N. Low-income tax credit
1. Generally. Except as otherwise provided by this section, an individual whose state taxable income is $2,000 or less is allowed a credit equal to the amount of the tax otherwise imposed on that individual by this Part. In no case may the credit allowed by this section reduce an individual's state income tax liability to less than zero.
2. Exceptions. The following individuals are not eligible for the credit allowed by this section:
A. An individual who is claimed as a dependent on another individual's income tax return; and
B. An individual who is subject to the state minimum tax imposed by section 5203-A.
3. Returns not required. Notwithstanding section 5220 or any other provision of law, an individual who is eligible for this credit is not required to file a state income tax return.
Sec. E-2. Application date. This Part applies to tax years beginning on or after January 1, 1997.
Sec. E-3. Transfer of funds. The State Controller shall transfer from the Tax Relief Fund for Maine Residents to the General Fund $2,382,939 in fiscal year 1997-98 to offset the revenue loss associated with the credit established in this Part. An amount equal to $982,215 may not lapse but must be carried forward to fiscal year 1998-99 to be used for the same purpose.
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