Dual Residence Reduction Of Tax Credit Worksheet For Tax Year 2015 Page 2
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2DUAL RESIDENCE REDUCTION OF TAX CREDIT
WORKSHEET FOR TAX YEAR 2015 INSTRUCTIONS
36 M.R.S. § 5128
Individuals who are considered residents of both Maine and another state for income tax purposes may qualify for a reduction
of tax provided the other taxing jurisdiction allows a similar tax reduction. Generally, income qualifying for the credit for
taxes paid to another jurisdiction does not qualify for this credit. Income that generally qualifi es for the dual residence tax
reduction is income from intangible sources such as interest and pension income. For questions on how to complete this
worksheet, call (207) 626-8475.
The reduction of tax is equal to a ratio of which the numerator is the Maine tax applicable to the income taxed twice and
the denominator of which is the sum of the two taxes applicable to the income taxed twice multiplied by the lower of the two
taxes applicable to the income taxed twice.
SPECIFIC INSTRUCTIONS
Enter taxpayer name and social security number (“SSN”) where indicated at the top of the form. Then enter the name of
the other taxing jurisdiction where indicated above line 1.
Line 1 is used to determine income taxed by both jurisdictions as a resident of each state excluding income eligible for
the Credit for Tax Paid to Other Jurisdictions (Form 1040ME, worksheet for Credit for Income Tax Paid to Other
Jurisdictions). The worksheet is available at
Line 3 is the percentage of income taxed by both jurisdictions in relation to the total Maine income.
Line 4 refl ects the tax assessed by each jurisdiction on the income eligible for dual residence tax deduction.
Line 7 is the percentage Maine tax represents of total tax assessed by both jurisdictions on the income eligible for the dual
residence tax reduction.
EXAMPLE:
John and Jane are full-year Maine residents, but they are also required to fi le as statutory residents of state XYZ for
the entire year. State XYZ allows a credit similar to Maine’s Dual Residence Reduction of Tax Credit. John and Jane
fi led a married joint return and had federal adjusted gross income of $150,000. John had wages of $50,000, pension of
$95,000 and interest of $5,000 that are also taxed by state XYZ as resident income.
XYZ
Name of other taxing jurisdiction: _____________________________
150,000
1. a. Amount of income taxed by both jurisdictions as a resident of both jurisdictions ................ 1a. $ ____________
b. Amount from Form 1040ME, worksheet for Credit for income Tax Paid to Other
50,000
Jurisdictions, line 2 taxed by the other jurisdiction named above ................................... 1b. $ ____________
100,000
c. Subtract line 1b from line 1a ........................................................................................... 1c. $ ____________
Pension: $95,000
List type and amount of income included on line 1c: ____________________________
Interest: $5,000
_____________________________________________________________________
150,000
2. Maine adjusted gross income (Form 1040ME, line 16) ......................................................... 2. $ ____________
0 6 6 6 7
3. Percentage of income (divide line 1c by line 2) .................................................................... 3.
__ . __ __ __ __
9,001
6,001
4. a. Maine tax on line 1c income (Form 1040ME, line 20) $_______ x line 3......................... 4a. $ ____________
3,568
b. Other jurisdiction tax paid (do not include amount withheld) on line 1c income ............. 4b. $ ____________
9,569
5. Total tax assessed by both jurisdictions (add line 4a and line 4b) ......................................... 5. $ ____________
3,568
6. Enter the smaller of line 4a or line 4b .................................................................................... 6. $ ____________
7. Percentage of Maine tax in relation to total combined tax for both jurisdictions
0 6 2 7 1
(divide line 4a by line 5) ......................................................................................................... 7.
__ . __ __ __ __
8. Dual Residence Reduction of Tax Credit:
2,237
Multiply line 6 by line 7. Enter the result here and on Form 1040ME, Schedule A, line 20 .. 8. $ ____________
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