Sec. 3. 36 MRSA §5122, sub-§2, ¶U is enacted to read:

U.__For income tax years beginning on or after January 1, 2005, to the extent included in federal adjusted gross income, the amount of qualified transportation fringe benefit program reimbursement provided by an employer to an employee under Section 132 of the Code.

Sec. 4. 36 MRSA §5200-A, sub-§2, ¶L, as amended by PL 2003, c. 20, Pt. EE, §3, is further amended to read:

L. An amount equal to the absolute value of any net operating loss arising from a tax year beginning or ending in 2001 for which federal taxable income was increased under subsection 1, paragraph M and that, pursuant to Section 102 of the federal Job Creation and Worker Assistance Act of 2002, Public Law 107-147, was carried back more than 2 years to the taxable year for federal income tax purposes, but only to the extent that:

(1) Maine taxable income is not reduced below zero;

(2) The taxable year is either within 2 years prior to the year in which the loss arose or within the allowable federal period for carry-over of net operating losses; and

(3) The amount has not been previously used as a modification pursuant to this subsection; and

Sec. 5. 36 MRSA §5200-A, sub-§2, ¶M, as repealed and replaced by PL 2003, c. 479, §6, is amended to read:

M. A fraction of any amount previously added back by the taxpayer to federal taxable income pursuant to subsection 1, paragraph N.

(1) With respect to property first placed in service during taxable years beginning in 2002, the adjustment under this paragraph is available for each year during the recovery period, beginning 2 years after the beginning of the taxable year during which the property was first placed in service. The fraction is equal to the amount added back under subsection 1, paragraph N