INSTRUCTIONS FOR 2007 MAINE ESTATE TAX RETURN (36 M.R.S.A. §§ 4061 - 4079)
If this estate contains Maine elective property (see line 4E
estate contains Maine elective property, complete Worksheet
instructions), Worksheet 706C must be included with this
706C (downloadable from the web site address at the top of this
return. Worksheet 706C contains the calculations necessary
page) to calculate the amount for this line.
to determine the correct amounts for the lines on this form.
Line 4A Enter the amount of the taxable federal estate from actual or
Worksheet 706C can be downloaded from the web site address
pro forma return, federal Form 706, Part 2, Line 3a.
at the top of this page.
Line 4B If the estate contains Maine elective property, Worksheet 706C
Step 1 Enter all required information. Failure to fully complete
must be completed to determine the amount on this line. If the
this section will delay processing of the return. If a personal
estate contains no Maine elective property, enter the amount
representative has not been appointed, qualiﬁ ed and acting in the
from federal Form 706, Part 2, line 4.
United States, every person in actual or constructive possession
Line 4C Enter the sum of lines 4A and 4B. If the amount is greater than
of any property of the decedent is considered a personal
$1,000,000, the estate is taxable to Maine and a completed
representative and must ﬁ le a return or be listed as a personal
Form 706ME must be submitted. If this estate contains Maine
representative on the single return that is ﬁ led for the estate.
elective property, Worksheet 706C must be included with
A personal representative can also be known as an executor or
any other individual legally responsible for administration of
the estate. If there is more than one personal representative, ﬁ ll
Line 4D Maine QTIP. For decedents with surviving spouses,
in the information for one personal representative and attach a
Maine allows a separate estate tax deduction for assets that
schedule listing all personal representatives.
are qualified terminable interest property (“QTIP”) under
IRC section 2056(b)(7), when a QTIP election is not made
Step 2 This section must be completed if you choose to have copies of
for federal estate tax purposes. The completion of Line 4D
conﬁ dential tax information sent to anyone other than the personal
with an amount greater than zero constitutes a QTIP election
representative, such as the preparer of Form 706ME. If a paid
for eligible Maine QTIP property by the executor or personal
preparer completed the return, that preparer must also sign the
representative. The maximum allowable QTIP deduction on Line
return on page 2.
4D is the difference between the decedent’s federal exclusion
Step 3 Check the appropriate box for the decedent’s residency status.
amount and the Maine exclusion amount, but in no event may
For additional information concerning residency status visit
the Maine QTIP deduction exceed $1,000,000 for 2007. If
the deduction on line 4D is a portion of a trust included in the
“Guidance to Residency Status.”
federal taxable estate, the executor or personal representative
Step 4 Tax Computation. If the total gross estate plus adjusted taxable
is considered to have made an election only as to a fraction of
gifts is $2,000,000 or less, complete this section based on a pro
the trust (or other property). The numerator of this fraction is
forma federal return. If the amount is greater than $1,000,000,
equal to the amount of the trust (or other property) deducted on
the estate is taxable to Maine and a completed Form 706ME
Line 4D, and the denominator is equal to the total value of the
must be submitted. If less than $1,000,000, you may ﬁ le a Form
trust (or other property) at the time of death of the deducting
706ME-EZ. If this estate contains Maine elective property,
decedent (ﬁ rst decedent spouse). Visit the web site address at
Worksheet 706C must be included with this return.
the top of this page for more information. Attach a description
of the QTIP property. QTIP property cannot consist of items
Property taxable by Maine. If the decedent had a predeceased
that were included as taxable gifts on the federal return. The
spouse whose estate contained a Maine qualiﬁ ed terminable
QTIP election defers taxation of the value of that election to the
interest property (“QTIP”) designation, this estate will generally
death of the decedent’s spouse (second decedent spouse). The
contain Maine elective property. If this is the case, complete
Maine estate tax return for the second decedent spouse must
Worksheet 706C (see note above) to calculate the amount for
include the value of the QTIP election, which is referred to as
this line and attach the worksheet to the return. Otherwise, the
Maine elective property (see line 4E).
tax calculation on this return may be incorrect, resulting in an
underpayment or overpayment of tax.
Line 4E Maine Elective Property. If the decedent on this return had a
predeceased spouse who claimed a Maine QTIP deduction on
For Maine resident estates: Enter the federal gross estate from
their Maine Estate tax return (see line 4D), the second decedent
federal Form 706, line 1, less the value of real and tangible
spouse’s estate tax return must include the current value of any
personal property located outside of Maine.
remaining Maine QTIP property on this line. This amount is
For Maine nonresident estates: Enter the value, included in the
called Maine elective property. All holdings, including cash,
federal gross estate, of all real and tangible personal property
securities, as well as real estate and tangible personal property,
located in Maine and personally owned by the decedent. This
that constitute Maine elective property must be included in
includes Maine real and tangible personal property transferred
this line. If this estate contains Maine elective property,
to trusts, LLCs or other pass-through vehicles.
Worksheet 706C must be included with this return.
For more information, see the guidance document Maine Estate
To calculate the amount for this line, use the worksheet on page
Tax Valuation and Filing Basics, online at:
Multiply Line 5 by the percentage on Line 3, and enter the
Enter the total gross estate from federal Form 706, Part 2, Line
1. If no federal estate tax return was required, but the total gross
Line 7a Enter the total dollar amount of the Maine estimated/extension
estate plus adjusted taxable gifts (pro forma federal Form 706,
payments made for this estate.
Part 2, Line 4) plus Maine elective property is greater than
$1,000,000, complete a pro forma federal Form 706. If the
Maine-only ﬁ ling: Even if you are not required to ﬁ le a federal return, you may still be liable for Maine tax if the total gross estate plus Maine elective
property plus adjusted taxable gifts is greater than $1,000,000. If you are not required to ﬁ le a federal return and the value of the total gross estate,
Maine elective property and adjusted taxable gifts is $1,000,000 or less, there is no Maine estate tax liability.
2007 Form 706ME, Page 3