Sec. 1. 36 MRSA §5122, sub-§1, ¶V, as amended by PL 2003, c. 705, §8, is further amended to read:

V. For tax years beginning on or after January 1, 2003 and before January 1, 2006, the amount claimed as a federal income adjustment for student loan interest under the Code, Section 62 (a)(17), but only for interest paid after 60 months from the start of the loan repayment period; and

Sec. 2. 36 MRSA §5122, sub-§1, ¶W, as enacted by PL 2003, c. 705, §9, is amended to read:

W. For tax years beginning on or after January 1, 2004, for an eligible individual as defined by the Code, Section 223 (c)(1), the amount of contributions to the eligible individual's health savings account under the Code, Sections 106 and 223 to the extent that those contributions, exclusive of rollovers, for the taxable year are not included in the eligible individual's federal adjusted gross income.; and

Sec. 3. 36 MRSA §5122, sub-§1, ¶X is enacted to read:

X.__Amounts withdrawn pursuant to section 7153, subsection 4 by the taxpayer during the taxable year from an individual medical savings account established in the taxpayer's name.

Sec. 4. 36 MRSA §5122, sub-§2, ¶Q, as corrected by RR 2003, c. 1, §38, is amended to read:

Q. A fraction of any amount previously added back by the taxpayer to federal adjusted gross income pursuant to subsection 1, paragraph N.

(1) With respect to property first placed in service during taxable years beginning in 2002, the adjustment under this paragraph is available for each year during the recovery period, beginning 2 years after the beginning of the taxable year during which the property was first placed in service. The fraction is equal to the amount added back under subsection 1, paragraph N with respect to the property, divided by the number of years in the recovery period minus 2.

(2) With respect to all other property, for the taxable year immediately following the taxable year during which the property was first placed in service, the fraction allowed by this paragraph is equal to 5%