Income/Franchise:
Maine: Proposed Rule Reflects New Bright-Line Nexus Standard Under Corporate Income Tax

Proposed Amended Reg. Section 18-125-808, Me. Rev. Serv. (3/22/22). Maine Revenue Services is proposing to amend “Rule 808” (Maine Corporate Income Tax Nexus) to:

1. Reflect recent legislative changes related to factor presence nexus thresholds that apply to tax years beginning on or after January 1, 2022 [see LD 1216 / HP 891 (2021) for more details on these law changes], and
2. Make certain technical changes.

Maine corporate income tax law now incorporates a “bright-line” economic nexus standard applicable to tax years beginning on or after January 1, 2022, so that a corporation generally is deemed to have nexus with Maine if it:

• Is organized or commercially domiciled in Maine; or
• Is organized or commercially domiciled outside Maine but has property, payroll or sales in Maine exceeding any of the following thresholds for the taxable year:
• For property, $250,000;
• For payroll, $250,000;
• For sales, $500,000; or
• 25% of the corporation’s property, payroll, or sales.

Comments on these proposed rule changes are due by April 29, 2022. Please contact us with any questions.