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LD 48

An Act To Update References To The United States Internal Revenue Code Of 1986 Contained In The Maine Revised Statutes

132nd Legislature (2025-2026) Introduced by Kristen Cloutier

Updates Maine tax law to conform with the current federal IRS Code (1986), effective immediately; affects individuals and businesses and reduces General Fund revenue.

Signed by Governor
#2024 #federalconformity #incometax
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Bill Summary · LD 48

Summary — LD 48: An Act To Update References to the United States Internal Revenue Code of 1986 Contained in the Maine Revised Statutes

Status: Signed by Governor (effective as an emergency measure) — Signed 2025-07-01
Introduced: 2025-01-06 | Sponsor: Rep. Cloutier (Lewiston) | Committee: Taxation

Purpose and intent

LD 48 updates Maine statutory references to the United States Internal Revenue Code (IRC) of 1986 so that Maine’s income tax laws conform to the current federal IRC provisions referenced in state law. The change is intended to align Maine’s tax treatment with applicable federal changes and to apply those federal rules to Maine tax years specified in the bill.

Key provisions

  • Revises the Maine Revised Statutes to update the incorporated reference(s) to the Internal Revenue Code of 1986 (federal tax code).
  • Applies the federal conformity for:
    • Any tax year beginning on or after January 1, 2024, and
    • Any prior tax year to the extent a prior year is specifically addressed by the federal IRC as amended.
  • The bill was amended in the Legislature (Committee Amendment A, H‑36) and enacted as an emergency measure (two‑thirds vote required and obtained), making the act effective immediately upon signing.

(The bill text itself is a statutory reference update; it does not separately enumerate substantive Maine tax policy changes beyond adopting the referenced federal IRC provisions.)

Who is affected

  • Individual and corporate taxpayers in Maine to the extent that federal changes included by reference alter taxable income, deductions, credits, or other federal tax items used in computing Maine tax.
  • The Department of Administrative and Financial Services, Bureau of Revenue Services, which administers Maine tax law and will implement the conformity.
  • State finances: General Fund and certain other special revenue funds.

Fiscal impact (from Fiscal Notes)

The Department of Administrative and Financial Services, Bureau of Revenue Services estimates reduced state revenue from the conformity as follows:

Total estimated revenue decreases (by fund):
- FY 2024–25: General Fund $665,000; Other Special Revenue Funds $35,000 (total ~$700,000)
- FY 2025–26: General Fund $855,000; Other Special Revenue Funds $45,000 (total ~$900,000)
- FY 2026–27: General Fund $332,500; Other Special Revenue Funds $17,500 (total ~$350,000)
- FY 2027–28: General Fund $142,500; Other Special Revenue Funds $7,500 (total ~$150,000)
- FY 2028–29: $0 projected

These figures reflect projected decreases in state tax revenue due to conforming to the cited federal changes.

Legislative/action timeline

  • Referred to Taxation Committee (01/06/2025); Work session and reported out as OTP‑AM.
  • Committee Amendment A (H‑36) adopted; passed both chambers (emergency enactment); ordered sent forthwith.
  • Passed to be enacted and signed by the Governor on 2025‑07‑01.

Notes

  • The bill functions as a federal conformity update. It incorporates federal law by reference rather than creating new, standalone Maine tax provisions.
  • The fiscal estimates reflect projected net revenue impacts to Maine’s General Fund and other affected funds. Specific federal changes incorporated are not listed in the fiscal documents provided.

Compiled from official sources — confirm details with the bill’s official record.

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