PART HH

Sec. HH-1. 36 MRSA §5124-A, as repealed and replaced by PL 1989, c. 495, §§2 and 9 and amended by c. 596, Pt. J, §7, is repealed and the following enacted in its place:

§5124-A.__Standard deduction; resident

The standard deduction of a resident individual is equal to the standard deduction as determined in accordance with the Code, Section 63, except that for tax years beginning in 2005, the Code, Section 63(c)(2) must be applied as if the basic standard deduction is $5,000 in the case of a joint return and a surviving spouse and $2,500 in the case of a married individual filing a separate return.

PART II

Sec. II-1. 36 MRSA §5122, sub-§1, ¶¶O and P, as enacted by PL 2001, c. 700, §4 and affected by §10, are amended to read:

O. The amount of the contribution to a qualified scholarship organization that is included in the credit base of the educational attainment investment tax credit under section 5219-U to the extent that the contribution has been used to adjust federal adjusted gross income; and

P. The amount of the loan repayment included in the credit base of the recruitment credit under section 5219-V to the extent that the repayment has been used to adjust federal adjusted gross income.;

Sec. II-2. 36 MRSA §5122, sub-§1, ¶¶Q to U are enacted to read:

Q.__For tax years beginning on or after January 1, 2003, the amount of deduction claimed pursuant to the Code, Section 222 for qualified tuition and related expenses;

R.__For tax years beginning in 2003, 2004 and 2005, and to the extent excluded from federal gross income, the amount