Maine Capital Investment Credit: Maine Capital Investment Credit (2024)
Maine · Maine Revenue Services · Used for tax years 2024
The Maine Capital Investment Credit Worksheet for Tax Year 2024 calculates the credit for eligible depreciable property placed in service in Maine. It reports the bonus depreciation add-back, the current-year credit calculated at 1.2%, unused credit from previous years, and the t
Who files this form
Use this worksheet to claim the Maine Capital Investment Credit for tax year 2024. The credit is available to businesses that place eligible depreciable property in service in Maine during a tax year beginning in 2024 and claim federal bonus depreciation under IRC § 168(k) on that property.
Owners of pass-through entities, including partnerships, LLCs, S corporations, and trusts, may claim the credit in proportion to their ownership interests. A nonresident owner participating in a composite return cannot claim it.
The following businesses cannot claim the credit:
- Public utilities.
- Providers of radio paging or mobile telecommunications services.
- Cable television companies.
- Providers of satellite-based direct television broadcast services.
- Providers of multichannel, multipoint television distribution services.
The credit also cannot be claimed for property transferred out of state or otherwise removed from use in Maine within 12 months after being placed in service in Maine.
What you'll need
- The completed 2024 Maine Capital Investment Credit Worksheet, including your taxpayer name and EIN or SSN.
- Federal Form 4562, which must be enclosed with the worksheet and your Maine return.
- The applicable Maine return and schedules: Form 1040ME, Form 1041ME, or Form 1120ME.
- The amount of any unused credit from previous years.
- For a pass-through entity credit, the entity's name, EIN, your ownership percentage for the tax year, and a copy of the federal Schedule K-1 issued to you.
Maine Revenue Services may request additional information supporting the credit before processing the return.
How to file
Enclose this worksheet and federal Form 4562 with Form 1040ME, Form 1041ME, or Form 1120ME. The supplied text does not give a mailing address or e-filing directions.
Complete the worksheet as follows:
- On line 1, enter the Maine Capital Investment Credit bonus depreciation add-back from Form 1040ME, Schedule 1A, line 5; Form 1041ME, Schedule 1, line 1f; or Form 1120ME, Schedule 1A, line 7.
- Multiply line 1 by 1.2% (.012) to calculate the current-year credit on line 2.
- Enter unused credit from previous years on line 3.
- Add lines 2 and 3 on line 4. Transfer that total to Form 1040ME, Schedule A, line 15; Form 1041ME, Schedule A, line 9; or Form 1120ME, Schedule C, line 1e.
If claiming through a pass-through entity, enter the entity information and your ownership percentage, and attach your federal Schedule K-1.
Common mistakes
- Leaving out required attachments. Enclose the worksheet and federal Form 4562 with your Maine return. Pass-through owners must also attach their federal Schedule K-1.
- Overlooking recapture. If the related property is transferred out of state or otherwise removed from service in a later tax year, but within 12 months of being placed in service in Maine, the credit is subject to recapture. Amend the return for the year you claimed it. Later returns may also need amendments to remove related credit carryforwards and adjust bonus depreciation.
- Using 2024 line numbers for earlier returns without checking. The recapture instructions warn that prior-year line references may differ.
- Applying a unitary business member's credit to another member's tax. A taxable corporation's credit may offset only that member's Maine income tax liability unless otherwise specifically permitted by law.
Questions people ask
How much is the credit for tax year 2024?
The credit is 1.2% of the eligible net increase in depreciation attributable to federal bonus depreciation and reported as an addition to income. The worksheet calculates this by multiplying line 1 by .012.
What if my available credit exceeds my tax liability?
The credit is limited to your tax liability. Any unused portion may be carried forward for up to 20 taxable years.
Can pass-through entity owners claim the credit?
Yes. Eligible partners, members, shareholders, beneficiaries, and other owners may claim a credit based on their ownership share of eligible bonus depreciation. Nonresident owners participating in a composite return cannot claim it.
Is the credit available for tax years beginning in 2025?
The credit is repealed for tax years beginning on or after January 1, 2025. Unused credit amounts may still be carried forward for up to 20 taxable years.
What happens if all the property supporting my credit becomes subject to recapture?
You must amend the return for the year you claimed the credit. If all property supporting the original credit is subject to recapture, the recalculated credit for that year is zero. You may also need to amend later returns to remove related carryforwards and make bonus depreciation adjustments.