LD 256
pg. 2
Page 1 of 6 An Act to Establish and Permit Medical Savings Accounts Page 3 of 6
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LR 1518
Item 1

 
T.__Interest or dividends on obligations or securities of
this State and its political subdivisions and authorities
to the extent included in federal adjusted gross income;
and

 
U. Contributions or deposits to an individual medical
savings account established under chapter 914 subject to
the following limitations.

 
(1)__The taxpayer may subtract:

 
(a)__The amount of contributions made by the
taxpayer's employer during the taxable year to
the taxpayer's individual medical savings
account to the extent that the employer
contributions are included in the taxpayer's
federal adjusted gross income; and

 
(b)__The amount deposited by the taxpayer in the
account during the taxable year.

 
(2)__The taxpayer's employer may subtract the amount
of contributions made by the employer to an
individual medical savings account established on the
taxpayer's behalf to the extent that the
contributions are not deductible under the Code.

 
Sec. 5. 36 MRSA §5164, sub-§1, as amended by PL 1999, c. 708, §38,
is further amended to read:

 
1. Fiduciary adjustment defined. The fiduciary adjustment
is the net amount of the modifications described in section
5122, including subsection 3 if the estate or trust is a
beneficiary of another estate or trust, which that relates to
items of income or deduction of an estate or trust. Income
taxes imposed by this State or any other taxing jurisdiction
and interest or expenses incurred in the production of income
exempt from tax under this Part deducted in arriving at
federal taxable income must be added back to the fiduciary
adjustment. Interest or expenses incurred in the production
of income taxable under this Part but exempt from federal
income tax must be subtracted from the fiduciary adjustment.

 
Interest income earned on a trust that is established as an
individual medical savings account pursuant to chapter 914 is
not included as income if the interest income is received on
obligations of a state, territory or possession of the United
States or a political subdivision of a state, territory or
possession that is located outside of this State.__Interest
earned by a trust that is established as an individual medical
savings account may be subtracted from the adjusted gross
income


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