Form 706me - Maine Estate Tax - 2011 printable pdf download

INSTRUCTIONS FOR 2011 MAINE ESTATE TAX RETURN (36 MRSA §§ 4061 - 4079)

For FAQs and other estate tax information, see

New for 2011:

Estate of nonresident: Enter the value, included in line

1, of real and tangible personal property located in Maine.

The dollar limit on Maine qualiﬁ ed terminable interest

property (“QTIP”) elections is increased for 2011 dece-

This includes property owned by a pass-through entity,

dents. The 2011 limit is equal to $4 million, the difference

unless that property is acquired through a bona ﬁ de sale

between the federal and state exclusion amounts. See 36

for full and adequate consideration, the ownership of the

MRSA § 4062(1-A)(A).

property in the entity is for a valid business purpose and

the entity actively carries on a business for the purpose of

Proceeds from the sale of Maine property by a nonresi-

proﬁ t and gain. See 36 MRSA § 4064.

dent decedent within six months of death are no longer

sourced to Maine for 2011 and later decedents. See 36

Line 4: Value of taxable gifts included in line 3 made within

MRSA § 4064.

one year of date of death.

Enter the value of taxable gifts

completed within the 365-day period ending on the date of

The Maine estate tax for deaths occurring in 2011 must

death of the decedent.

be determined in accordance with the law applicable to

Line 5: Value of gifts included in line 4 taxable by Maine.

Attach

decedents dying during calendar year 2009. A pro forma

copy of appropriate federal Form(s) 709.

2009 federal Form 706 must be completed in order to

complete Maine Form 706ME for a 2011 decedent. Line

Estate of resident: Enter the amount from line 4 less the

references to the federal form on Form 706ME and in

value of real and tangible personal property located outside

the instructions refer to the pro forma 2009 federal Form

of Maine at the time of the gift.

706.

Estate of nonresident: Enter the value, included in line

Certiﬁ cates of Discharge of Estate Tax Lien for real property

4, of real and tangible personal property located in Maine

and for tangible personal property may be submitted by

at the time of the gift. This includes property owned by a

email to Maine Revenue Services (“MRS”) at:

estatetax@

pass-through entity, unless that property is acquired through

maine.gov. The certiﬁ cates may be formatted as either a

a bona ﬁ de sale for full and adequate consideration, the

pdf document or a Microsoft Word ﬁ le. An emailed certiﬁ cate

ownership of the property in the entity is for a valid business

is acceptable only if sent from one of the email addresses

purpose and the entity actively carries on a business for

included on page one of the return (personal representative

the purpose of proﬁ t and gain. See 36 MRSA § 4064.

or estate representative). An emailed certiﬁ cate must also

Line 7: Gross value of Maine elective property.

If the decedent

contain all of the information included on the ofﬁ cial form.

had a predeceased spouse who made a Maine QTIP

While a certiﬁ cate may be submitted by mail or email, Form

election, this line must include the current value of that

706ME must be sent by mail.

Maine QTIP, regardless of the location or type of property

Step 1 Complete this section with information about the

(tangible or intangible). This amount is called Maine

decedent and the personal representative. The personal

elective property. All holdings that constitute Maine

representative, or executor, is the individual legally

elective property, including cash, securities, real estate

responsible for administration of the estate. If a personal

and tangible personal property, must be included on this

representative has not been appointed, every person in

line. The property must be valued on the date of death of

possession of property of the decedent is considered a

the decedent, unless the alternate valuation date is used

personal representative and must ﬁ le a return or be listed

for all assets. See Rule 601 for more information.

on the single return that is ﬁ led for the estate. If the estate

Line 8: Value of property included in line 7 taxable by Maine.

has more than one personal representative, ﬁ ll in the

information for one personal representative and attach

Estate of resident: Enter the amount from line 7 less the

a schedule listing all other personal representatives. A

value of real and tangible personal property located outside

personal representative, including a nonresident, may

of Maine on the date of death of the decedent.

have to ﬁ le a Maine income tax return for any estate fees

Estate of nonresident: Enter the value, included in line 7, of

or other income earned in Maine. For more information,

all real and tangible personal property located in Maine. This

see Maine Rule 806 (Nonresident Individual Income Tax)

includes real and tangible personal property in a trust, LLC

and the instructions for Form 1040ME, Schedule NR at

or other pass-through entities. See 36 MRSA § 4064.

Line 9: Maine qualiﬁ ed terminable interest property.

Maine

Step 2 This step must be completed if you choose to have copies

allows a deduction for assets that are eligible for the

of conﬁ dential tax information sent to anyone other than

QTIP election under IRC section 2056(b)(7), when a QTIP

the personal representative, such as the preparer of Form

election is not made on that property for federal estate tax

706ME. If a paid preparer completed the return, that

purposes. Entering an amount on this line constitutes a

preparer must also sign the return on page 2. The person

Maine QTIP election for eligible property. The maximum

referred to in this section is the estate representative.

allowable Maine QTIP election is the difference between

Step 3 Check the appropriate box for the decedent’s residency

the decedent’s federal exclusion amount and the Maine

status. For additional information concerning residency

exclusion amount. For 2011, this maximum election is

status, see

$4,000,000. If the Maine QTIP is a portion of a trust or

guidance

and select “Guidance to Residency Status.”

other property included in the federal taxable estate, the

personal representative is considered to have made an

Step 4 Tax Computation. Complete this section based on the

election equal to a fraction of that trust or property. The

2009 pro forma federal Form 706. A completed Form

numerator of the fraction is the amount of the Maine QTIP

706ME is required if: 1) the federal total gross estate (line

entered on this line and the denominator is the total value

1) plus federal adjusted taxable gifts (line 3) is greater than

of the trust or property. Attach a description of the assets

$1,000,000; 2) the estate has Maine elective property (line

in the Maine QTIP. A Maine QTIP cannot contain items that

7); or 3) the personal representative is making a Maine

are includible as taxable gifts on the federal return. The

QTIP election for the estate (line 9). Otherwise, Form

Maine QTIP election defers taxation of the transfer of that

706ME-EZ may be used to request a discharge of the

property to the death of the decedent’s spouse (subsequent

automatic property lien provided under 36 MRSA § 4072.

decedent spouse). The Maine estate tax return for the

Line 2: Value of Federal Total Gross Estate taxable by Maine.

subsequent decedent spouse must include the remaining

value of the Maine QTIP, which is referred to as Maine

Estate of resident: Enter the amount from line 1 less the

elective property. See Rule 601 for more information.

value of real and tangible personal property located outside

of Maine on the date of death of the decedent.

Page 3

Form 706me - Maine Estate Tax - 2011

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