Sec. 6. 36 MRSA §5200-A, sub-§2, ¶¶N and O, as enacted by PL 2001, c. 714, Pt. AA, §7, are amended to read:

N. For tax years beginning in 2005, 2006 or 2007, an amount equal to 1/3 of any amount added back to federal taxable income by the taxpayer for the 2003 tax year pursuant to subsection 1, paragraph N, except with respect to 3-year property, in which case this paragraph does not apply to 2006 or 2007 tax years and the amount to be subtracted pursuant to this paragraph in the 2005 tax year is an amount equal to the amount added back pursuant to subsection 1, paragraph N; and

O. For tax years beginning in 2006, 2007 or 2008, an amount equal to 1/3 of any amount added back to federal taxable income by the taxpayer for the 2004 tax year pursuant to subsection 1, paragraph N, except with respect to 3-year property, in which case this paragraph does not apply to 2007 or 2008 tax years and the amount to be subtracted pursuant to this paragraph in the 2006 tax year is an amount

equal to the amount added back pursuant to subsection 1, paragraph N.; and

Sec. 7. 36 MRSA §5200-A, sub-§2, ¶P is enacted to read:

P.__The amount of contributions made by the taxpayer during the taxable year to individual medical savings accounts established on behalf of the taxpayer's employees pursuant to chapter 914 to the extent that the contributions are not deductible under the Code.

Sec. 8. 36 MRSA c. 914 is enacted to read:

CHAPTER 914

INDIVIDUAL MEDICAL SAVINGS ACCOUNT ACT

§6601. Short title

This chapter may be known and cited as "the Individual Medical Savings Account Act."

§6602.__Definitions

As used in this chapter, unless the context otherwise indicates, the following terms have the following meanings.