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Coronavirus (COVID-19) FAQs
- Who is eligible for the Maine tax filing and payment extension to July 15, 2020?
- What if I am not able to file my Maine income or franchise tax return that was originally due April 15, 2020 through June 15, 2020 by July 15, 2020?
- I have already filed my 2019 income tax return and scheduled a payment of taxes to be made before July 15, 2020. Can I reschedule my payment to be made on July 15, 2020?
- I am a nonresident providing disaster relief in Maine during the COVID-19 pandemic. Will I be subject to Maine income tax?
- My federal education loan payments are temporarily suspended from March 13, 2020 through September 30, 2020 under the federal CARES Act. However, I plan to continue to pay my student loans during this time. Can I still claim the Maine Educational Opportunity tax credit ("EOTC") for these payments when I file my 2020 income tax return?
- I am a qualified individual under the EOTC. Can I still claim the credit for tax year 2020 even though I was temporarily laid off due to COVID-19?
- Does Maine tax law provide any tax relief or incentives (e.g., exemptions, deductions, or credits) to companies that are providing supplies and resources to hospitals, non-profits, other businesses, and families?
- Does Maine provide any exemptions from Maine’s lodging tax (i.e., sales tax) for individuals living and working in Maine due to COVID- 19?
- Due to COVID-19, Maine individuals who are domiciled outside of Maine but maintain a second home in the State may be spending more time at their Maine home this year. For purposes of the Maine statutory residence test, would such an individual qualify for an exception due to COVID-19?
01. Who is eligible for the Maine tax filing and payment extension to July 15, 2020?
As previously announced in the March 2020 - #3 issue of the Maine Tax Alert, the due date for any final or estimated Maine income and franchise tax payments originally due on April 15, 2020 is extended to July 15, 2020. It was subsequently announced in the April 2020 - #5 issue of the Maine Tax Alert, that the extended due date of July 15, 2020 is expanded to include estimated and final income and franchise tax payments originally due April 16, 2020 through June 15, 2020.
This extended payment due date of July 15, 2020 also applies to filing Maine income tax and franchise tax returns (calendar-year and fiscal-year filers) for returns originally due April 15, 2020 through June 15, 2020. This includes Form 1040ME (Individual Income Tax Return), Form 1041ME (Income Tax Return for Estates and Trusts), Form 1120ME (Corporate Income Tax Return), and Form 1120B-ME (Franchise Tax Return).
This extension also does not affect other taxes, such as employer withholding returns.
Taxpayers are still encouraged to make payments and file if they are able and prepared to do so.
Updated May 7, 2020
02. What if I am not able to file my 2019 Maine income or franchise tax return that was originally due April 15, 2020 through June 15, 2020 by July 15, 2020?
If you are unable to file your return that was originally due April 15, 2020 through June 15, 2020 by July 15, 2020, Maine will allow an automatic six-month filing extension, beginning with the original due date of the return. For example, with the six-month extension, your individual income tax return originally due April 15, 2020 would be due on October 15, 2020.
With a six-month extension to file, a penalty for failure to file will not be assessed if you file your return on or before the end of the six-month extended due date. However, to avoid penalties for late payment, you must pay at least 90 percent of the tax you owe by July 15, 2020. You may remit your estimated tax payment with the extension payment voucher available at www.maine.gov/revenue/forms. Related interest will be charged on any unpaid tax balance remaining after July 15, 2020.
Again, MRS encourages all taxpayers to still pay and file as soon as possible.
Updated May 7, 2020
03. I have already filed my 2019 income tax return and scheduled a payment of taxes to be made before July 15, 2020. Can I reschedule my payment to be made on July 15, 2020?
Your payment will continue to be made on the date you have chosen. However, you can cancel and reschedule your payment as follows:
- If you scheduled a payment through Maine EZ Pay and the scheduled date is more than 3 days from the current date, visit Maine EZ Pay and click Cancel/Review Pending Payments. You can cancel the existing payment and set up another scheduled payment using another date. If the payment date is 3 days or less from the current date, the payment cannot be cancelled.
- Tax Software: If the payment was scheduled through tax software, Maine Revenue Services cannot cancel the payment. You should contact your tax preparer or, if the return was self-prepared, contact the software vendor.
If the payment cannot be cancelled/rescheduled as noted above, you can contact your financial institution or credit card processor, whichever applies, to request to stop payment and/or change the scheduled date.
Updated May 7, 2020
04. I am a nonresident providing disaster relief in Maine during the COVID-19 pandemic. Will I be subject to Maine income tax?
Maine law provides that certain compensation for personal services performed in Maine as an employee and certain income from a trade or business conducted in Maine are exempt from Maine income tax during a disaster period. Specifically, the taxpayer must be a nonresident whose presence in Maine during the tax year is for the sole purpose of performing services or conducting business during a disaster period and whose compensation or income is directly related to a declared state disaster or emergency at the request of either (1) the State; (2) a county, city, town, or political subdivision of the State; or (3) a registered business. 36 M.R.S. § 5142(8-B)(D).
This exemption from Maine income tax is available during the COVID-19 disaster period. Generally, the disaster period runs for 60 days beginning with the date of the Governor’s proclamation of a state of emergency on March 15, 2020. See 36 M.R.S. §§ 5102(6-B) and (6-C).
However, on May 12, 2020, Governor Mills issued Executive Order 53 FY19/20, temporarily extending a “disaster period,” as defined in 36 M.R.S. Section 5102(6-C), to extend until 30 days after the termination of the state of emergency.
Updated May 14, 2020
05. My federal education loan payments are temporarily suspended from March 13, 2020 through September 30, 2020 under the federal CARES Act. However, I plan to continue to pay my student loans during this time. Can I still claim the Maine Education Opportunity tax credit (EOTC) for these payments when I file my 2020 income tax return?
Generally, payments made in excess of the required loan payment due are not eligible for the EOTC. For example, if your loan is deferred or in forbearance and there is no loan payment due, any payments you make while the loan is deferred or in forbearance are not eligible for the EOTC.
The automatic temporary suspension of certain federal student loan payments under the federal CARES Act is optional. Therefore, to the extent that you have elected to opt out of the temporary suspension, you can continue to claim the Maine EOTC for monthly loan payments you make directly to the lender during the suspension period, subject to the normal eligibility requirements and credit limitations (e.g., benchmark, loan payment due, etc.).
IMPORTANT NOTE: If you do not opt out of the temporary suspension, your required loan amount due will be $0 and you will not be eligible to claim the EOTC for any payments you make during the suspension period.
For more information, see the Maine Educational Opportunity Tax Credit Worksheet at www.maine.gov/revenue/forms (click on Worksheets for Tax Credits).
Updated May 7, 2020
06. I am a qualified individual under the EOTC. Can I still claim the credit for tax year 2020 even though I was temporarily laid off due to COVID-19?
To the extent you are otherwise qualified, you may claim the EOTC for any eligible monthly payments you made directly to the lender during the tax year, subject to the credit limitations (e.g., benchmark, loan payment due, etc.). However, you are not a qualified individual unless you were employed at least part-time (at least 16 hours/week) in Maine, were deployed for military service in the U.S. Armed Forces, including the National Guard and the Reserves of the U.S. Armed Forces, or were employed at least part-time on a vessel at sea. See 36 M.R.S. § 5217-D(1)(G)(5).
07. Does Maine tax law provide any tax relief or incentives (e.g., exemptions, deductions, or credits) to companies that are providing supplies and resources to hospitals, non-profits, other businesses, and families?
Maine sales and use tax laws currently provide several exemptions that may be available to companies providing supplies and resources at this time for the COVID-19 pandemic. Specifically, 36 M.R.S. § 1760(45)(A-4) provides the following sales tax exemption for certain property brought into the State during the disaster period:
If the property is brought into this State solely to conduct activities directly related to a declared state disaster or emergency, at the request of the State, a county, city, town or political subdivision of the State or a registered business, the property is owned by a person not otherwise required to register as a seller under section 1754-B and the property is present in this State only during a disaster period.
On May 12, 2020, Governor Mills issued Executive Order 53 FY19/20, temporarily extending a “disaster period,” as defined in 36 M.R.S. Section 5102(6-C), to extend until 30 days after the termination of the state of emergency.
In addition, the following are specific current sales and use tax exemptions that may also apply to such companies:
- Sales tax exemption for sales to certain hospitals, research centers, churches, and schools – 36 M.R.S. § 1760(16)
- Use tax exemption on donations of merchandise to certain exempt organizations – 36 M.R.S. § 1864
For a full list of sales and use tax exemptions, please see Title 36, Chapters 211 and 215 of the Maine Revised Statutes.
Updated May 14, 2020
08. Does Maine provide any exemptions from Maine’s lodging tax (i.e., sales tax) for individuals living and working in Maine due to COVID- 19?
Maine law provides two sales tax exemptions related to the rental of living quarters (lodging):
- A rental charged to an individual who resides continuously for 28 days or more at any one hotel, rooming house, tourist camp, or trailer camp is exempt from sales tax if the individual does not maintain a primary residence at some other location or is residing away from the individual’s primary residence in connection with employment or education; and
- A rental charged to a person that rents living quarters for 28 or more consecutive days is exempt from sales tax when the living quarters are used by the person’s employees in connection with their employment. 36 M.R.S. 1760(20). See Instructional Bulletin No. 32 (“Rental of Living Quarters”) for further details regarding qualifications and requirements.
An affidavit of exemption for 28-day continuous rental must be completed by (1) the tenant or employer and (2) the retailer for the exemption to apply.
The affidavit is found here: www.maine.gov/revenue/forms/sales/STA10528dayrentalaffidavit20171101.pdf.
Updated May 7, 2020
09. Due to COVID-19, Maine individuals who are domiciled outside of Maine but maintain a second home in the State may be spending more time at their Maine home this year. For purposes of the Maine statutory residence test, would such an individual qualify for an exception due to COVID-19?
No.
An individual is considered a statutory resident of Maine if the individual (1) is not domiciled in Maine but maintains a “permanent place of abode” in Maine and (2) spends more than 183 days of the year in the State (unless the individual is in the U.S. Armed Forces). See 36 M.R.S. § 5102(5)(B).
As an exception to the “permanent place of abode” requirement, above, MRS Rule 807 provides that a “place of abode” is not considered “permanent” if it is only maintained during (1) a “temporary stay in Maine” and (2) such temporary stay is for the “accomplishment of a particular purpose.” However, an individual who is domiciled outside of Maine but maintains a second home in Maine at which they stay during part of the year would not meet this exception in MRS Rule 807, even during COVID-19.
Therefore, an individual living at their second home in Maine for more than 183 days during the tax year would be considered a Maine statutory resident, even during COVID-19.Updated July 9, 2020