Worksheet PTE -- Credit Ratio Worksheet for Individuals claiming the Pine Tree D: Worksheet PTE -- Credit Ratio Worksheet for Individuals claiming the Pine Tree Development Zone Tax Credit (2024)

Who files this form

An individual taxpayer claiming a Pine Tree Development Zone (PTDZ) credit from a sole proprietorship or a pass-through entity, such as a partnership or S corporation, must complete this worksheet.

The 2024 worksheet is labeled for individuals, estates, or trusts. It calculates the business-to-nonbusiness income ratio used to figure the credit on the separate PTDZ tax credit worksheet.

What you'll need

• Your Maine income tax return, Form 1040ME or Form 1041ME.
• Federal Schedule C for a sole proprietor, or Schedule K-1 for a member of a pass-through entity, showing income from the qualified PTDZ business.
• Form 1040ME, Schedules 1A and 1S, or Form 1041ME, Schedule 1, for Maine income modifications related to the qualified business.
• The PTDZ apportionment percentage reported by the business entity.
• The separate Pine Tree Development Zone tax credit worksheet.
• A copy of the business’s PTDZ certificate issued by the Department of Economic and Community Development.

How to file

Complete Worksheet PTE as follows:

1. On line 1, enter federal adjusted gross income from Form 1040ME, line 14, or federal taxable income from Form 1041ME, line 1.
2. On line 2, enter the qualified PTDZ business income included in line 1, using federal Schedule C or Schedule K-1.
3. On line 3, enter Maine income modifications related to that business. This amount may be negative.
4. Add lines 2 and 3 and enter the result on line 4.
5. On line 5, enter Maine adjusted gross income from Form 1040ME, line 16, or Maine taxable income from Form 1041ME, line 3.
6. Divide line 4 by line 5 for line 6. If the result is greater than 1, enter 1.0000.
7. On line 7, enter the PTDZ apportionment percentage reported by the business entity.
8. Multiply line 6 by line 7. Enter the result on line 8 and on line 7 of the separate PTDZ tax credit worksheet.

Attach both worksheets and a copy of the business’s PTDZ certificate to your Maine income tax return, Form 1040ME or Form 1041ME.

Common mistakes

• Do not leave out the required attachments. The form says to attach Worksheet PTE, the PTDZ tax credit worksheet, and a copy of the business’s PTDZ certificate to your Maine income tax return.
• Be prepared to provide support for the credit. Maine Revenue Services notes that it may request additional information before the return can be processed.

Questions people ask

Does Worksheet PTE calculate my actual credit?

No. It calculates the business-to-nonbusiness income ratio. The separate PTDZ tax credit worksheet calculates the applicable credit.

Where do I find the business income for line 2?

Use federal Schedule C if you are a sole proprietor, or Schedule K-1 if you are a member of a pass-through entity. Enter the qualified PTDZ business income included in line 1.

Can line 3 be negative?

Yes. The form states that Maine income modifications related to the PTDZ business may be a negative number.

Where does the final credit ratio go?

Enter the result on Worksheet PTE, line 8, and on the Pine Tree Development Zone Tax Credit Worksheet, line 7.

Official sources

• https://www.maine.gov/revenue/sites/maine.gov.revenue/files/inline-files/24_pine_tree_dev_zone_pte_ff.pdf