Maine Income Modification Subtractions

Income Modification Subtractions 
2023 Schedule 1S (Form 1040ME)
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SCHEDULE 1S

2023

Form 1040ME

Attachment
Sequence No. 5

Print
Income Subtraction Modifications
See instructions on pages 7 through 8.
Enclose with your Form 1040ME.

For more information, visit www.maine.gov/revenue/tax-return-forms.

Name(s) as shown on Form 1040ME

*2302105*

99

Your Social Security Number

DO NOT ENTER $ signs, commas, or decimals.
SUBTRACTIONS from federal adjusted gross income.
1.	

U.S. Government Bond interest included in federal adjusted gross income. (See instructions.).......	 1.

	

.00

2.	

State income tax refund. (Only if included in federal adjusted gross income.)...................................	 2.

	

3.	
	

Social Security and Railroad Retirement Benefits included in federal adjusted gross
income. (See instructions.).................................................................................................................	 3.

.00

	

.00

4.	
	
	

Pension income deduction. (Complete and attach the worksheet on back.)......................................	 4.
Check here if the amount on line 4 includes military retirement pay
(from line 6 of the Worksheet for Pension Income Deduction)...............................

	

.00

5.	
	

Non-Maine active duty military pay received by a Maine resident and military
compensation received by a nonresident of Maine. (See instructions.).............................................	 5.

	

.00

6.	

Military annuity payments made to a survivor of a deceased member of the military........................	6.

	

7.	
	

Maine Public Employees Retirement System pick-up contributions paid to the taxpayer
during 2023 which have been previously taxed by the state..............................................................	 7.

.00

	

.00

8.	
	

Contributions to Qualified Tuition Programs - 529 Plans. (Limited to $1,000 per
beneficiary. See Instructions).............................................................................................................	 8.

	

.00

9.	

Fiduciary adjustment - subtractions only. (Attach a copy of your federal Schedule K-1.)..................	 9.

	

.00

10.	 Bonus depreciation and section 179 recapture. (See instructions.)....................................................	10.

	

.00

11.	 Medical cannabis business expenses. (See instructions.)...............................................................	11.

	

.00

	

Enter your registration number or sales tax number:_______________________________

	

.00

13.	 Net operating loss recapture..............................................................................................................	13.

	

.00

14.	 FAME nonprofit student loan repayment program...............................................................................	14.

	

.00

15.	 Qualified health care student loan payments made by your employer...............................................	15.

	

.00

16.	 Municipal property tax benefits for senior citizens .............................................................................	16.

	

.00

17.	 Family Development Account proceeds.............................................................................................	17.

	

.00

18.	 Interest from Maine Municipal General Obligation Bonds, Private Activity Bonds,
	
and Airport Authority Bonds included in federal adjusted gross income.............................................	18.

	

.00

claiming the federal Work Opportunity Credit or Empowerment Zone Credit....................................	19.

	

.00

20.	 Earnings from fishing operations contributed to a capital construction fund......................................	20.

	

.00

12.	 Adult use cannabis business expenses. (See instructions.)............................................................	12.
	

Enter your registration number or sales tax number:_______________________________

19.	 Amount of the reduction in your salaries and wages expense deductions related to
	

Continue on Form 1040ME, Schedule 1S, page 2
1

2023 Form 1040ME, Schedule 1S, page 2
DO NOT ENTER $ signs, commas, or decimals.

*2302203*

21.	 All items of income, gain, interest, dividends, royalties and other items of income of
	
a pass-through financial institution due to an ownership share in the financial institution.
	
EIN of financial institution: ____________________ ..........................................................................	21.

	

22.	 The total of capital gains and ordinary income resulting from depreciation recapture
	
from the sale of multi-family affordable housing property....................................................................	22.

.00

	

.00

23.	 Percentage of gain from the sale of eligible timberlands....................................................................	23.

	

.00

24.	 Business interest deduction recapture...............................................................................................	24.

	

.00

enter the amount here. Otherwise, leave this line blank. (Attach Schedule ETM.).............................	25.

	

.00

26.	 Other. (Attach worksheet(s) - see instructions.).................................................................................	26.

	

.00

27.	 Total Subtractions. (Add lines 1 through 26 - enter here and on 1040ME, line 15b.)......................	27.

	

.00

25.	 Enrolled tribal members in Maine. If Schedule ETM, column C, line 5 is greater than zero,
	

2023 - Worksheet for Pension Income Deduction - Schedule 1S, Line 4
Enclose this worksheet and copies of your 1099 form(s) with Form 1040ME.

	 The benefits received under a United States military retirement plan,
including survivor benefits, are fully exempt from Maine income tax.
See line 6 of the worksheet below. Only military retirement pay received
as a result of service in the United States Army, Navy, Air Force, Marines, or
Coast Guard qualify for the military retirement deduction on line 6.
	 In addition, you and your spouse (if married) may each deduct up to $30,000
of other eligible pension income* that is included in your federal adjusted
gross income. The $30,000 cap must be reduced by any social security and
railroad retirement benefits received, whether taxable or not.
	 Deductible pension income, other than military retirement pay, includes
state and federal pension benefits and retirement benefits received from plans
established and maintained by an employer for the benefit of its employees
under Internal Revenue Code (IRC) sections 401(a) (qualified pension plans,
including qualified 401 SIMPLE plans), 401(k) (qualified cash or deferred
arrangements) and 403 (employee annuities). Deductible pension income also
includes benefits received from an individual retirement account under IRC
section 408, Roth IRA accounts under IRC section 408A, SIMPLE individual
retirement accounts under IRC section 408(k), simplified employee pension
plans under IRC section 408(p), benefits received under IRC section 457(b)
(state and local government/tax exempt organizations/eligible deferred
compensation plans), except that pick-up contributions received from the
Maine Public Employees Retirement System (“MainePERS”) allowed to be
deducted on Form 1040ME, Schedule 1S, line 7 and pension income from
457(b) plans received prior to age 55 that is not part of a series of equal

periodic payments made over the life of the recipient and the recipient’s
designated beneficiary, if applicable, may not be included in the deductible
pension amount.
Note that a conversion of benefits from one account to another does
not qualify for the pension income deduction. For example, a deduction
may not be taken when a taxpayer converts a traditional IRA to a Roth
IRA. The taxpayer, in this case, does not receive a retirement or IRA
benefit at the time of conversion.
	 Pension benefits that do not qualify are those received from an ineligible
deferred compensation plan under IRC section 457(f), refunds of excess
contributions, lump-sum distributions included on federal Form 4972 and
distributions subject to the additional 10% federal tax on early distributions.
See federal Form 5329, Part 1, or federal Form 1040 or 1040-SR, Schedule
2, line 8. Also, disability benefits reported as wages on your federal income
tax return do not qualify.
	 *Eligible pension income does not include benefits earned by another
person, except in the case of a surviving spouse. Only the individual
who earned the benefit from prior employment may claim the pension
income for the deduction. However, a widowed spouse receiving
survivor’s benefits under an eligible pension plan may claim that amount
for purposes of this deduction, but the total pension deduction for the
surviving spouse may not exceed $30,000.

Note: Enter eligible non-military pension benefits on line 1 and eligible military retirement pay on
	Taxpayer	
line 6.

Spouse*

1.	 Total eligible non-military pension income (both Maine and non-Maine sources) included in
	 your federal adjusted gross income (from federal Form 1040, lines 4b and 5b or
	 Form 1040-SR, lines 4b and 5b). CAUTION: Include only deductible pension benefits that
	are not specifically excluded. See the instructions above.	

1.	 $	

$

2.	 Maximum allowable deduction.	

2.	 $	30,000.00	

$		30,000.00

3.	 Total social security and railroad retirement benefits you received - whether taxable or not.	

3.	 $	

$	

4.	 Subtract line 3 from line 2 (if zero or less, enter zero).	

4.	 $	

$	

5.	 Enter the smaller of line 1 or line 4 here.	

5.	 $	

$

6.	 Total eligible military retirement pay included in your federal adjusted gross income
	 (from federal Form 1040, lines 4b and 5b or Form 1040-SR, lines 4b and 5b).	

6.	 $	

$

7.	 Add line 5 and line 6 and enter the total for both spouses on Schedule 1S, line 4.	

7.	 $	

$	

	

*Use this column only if you are married filing jointly and only if your spouse separately earned an eligible pension.

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