From 6a99b16ad709def7ae35a075268e29abcb5a64ab Mon Sep 17 00:00:00 2001 From: PavelMakarchuk Date: Mon, 19 Oct 2026 14:44:11 -0400 Subject: [PATCH] Apply the federal TIN tests to the Maine dependent exemption credit 36 MRSA 5219-SS allows the credit for each qualifying child and dependent for whom the taxpayer was eligible to claim the federal credit under section 24, and the 2025 worksheet counts the dependents on Form 1040ME line 13a (Child Tax Credit or credit for other dependents). Count each dependent with a positive section 24 amount (ctc_individual_maximum), so a dependent without an SSN, ITIN or ATIN, or a return with a filer without an SSN or ITIN, gets no credit. The section 24 amount already applies IRC 152(b)(1), so the separate claimable-filer check is removed. Co-Authored-By: Claude Opus 5.5 --- ...me-dependent-exemption-credit-tin.fixed.md | 1 + ...endent_exemption_credit_amount_person.yaml | 144 +++++++++++++++++- ...ependent_exemption_credit_amount_person.py | 38 +++-- 3 files changed, 170 insertions(+), 13 deletions(-) create mode 100644 changelog.d/me-dependent-exemption-credit-tin.fixed.md diff --git a/changelog.d/me-dependent-exemption-credit-tin.fixed.md b/changelog.d/me-dependent-exemption-credit-tin.fixed.md new file mode 100644 index 00000000000..5484586635d --- /dev/null +++ b/changelog.d/me-dependent-exemption-credit-tin.fixed.md @@ -0,0 +1 @@ +Allow the Maine dependent exemption credit only for dependents for whom the filer can claim the federal Child Tax Credit or credit for other dependents, so a dependent without an SSN, ITIN or ATIN, or a return with a filer without an SSN or ITIN, gets no credit. diff --git a/policyengine_us/tests/policy/baseline/gov/states/me/tax/income/credits/me_dependent_exemption_credit_amount_person.yaml b/policyengine_us/tests/policy/baseline/gov/states/me/tax/income/credits/me_dependent_exemption_credit_amount_person.yaml index 679a12a458c..b958ada6555 100644 --- a/policyengine_us/tests/policy/baseline/gov/states/me/tax/income/credits/me_dependent_exemption_credit_amount_person.yaml +++ b/policyengine_us/tests/policy/baseline/gov/states/me/tax/income/credits/me_dependent_exemption_credit_amount_person.yaml @@ -1,3 +1,8 @@ +# 36 MRSA 5219-SS allows the credit for each qualifying child and dependent for +# whom the filer can claim the federal credit under section 24. The 2025 worksheet +# counts the dependents on Form 1040ME line 13a: those for whom the filer is +# eligible to claim the Child Tax Credit or the credit for other dependents. Both +# federal credits need a TIN for the dependent and for each filer. - name: Child dependent under 6 period: 2025 input: @@ -26,5 +31,142 @@ is_tax_unit_dependent: true age: 2 output: - # Even non-CTC children who are tax dependents qualify for ME credit + # A dependent who is not a CTC qualifying child still counts when the filer + # can claim the credit for other dependents for them. me_dependent_exemption_credit_amount_person: 610 + +- name: Dependent without an SSN, ITIN or ATIN gets no credit in 2025 + # The credit for other dependents requires the dependent's SSN, ITIN or ATIN. + period: 2025 + input: + people: + head: + age: 40 + spouse: + age: 40 + child: + age: 8 + is_tax_unit_dependent: true + ssn_card_type: NONE + has_tin: false + tax_units: + tax_unit: + members: [head, spouse, child] + filing_status: JOINT + households: + household: + members: [head, spouse, child] + state_code: ME + output: + ctc_qualifying_child: [false, false, false] + ctc_individual_maximum: [0, 0, 0] + me_dependent_exemption_credit_amount_person: [0, 0, 0] + me_dependent_exemption_credit: 0 + +- name: Child of a head of household without any TIN gets no credit in 2025 + # Neither the Child Tax Credit nor the credit for other dependents is allowed + # when the filer has no SSN or ITIN. + period: 2025 + input: + people: + head: + age: 30 + ssn_card_type: NONE + has_tin: false + child: + age: 4 + is_tax_unit_dependent: true + tax_units: + tax_unit: + members: [head, child] + filing_status: HEAD_OF_HOUSEHOLD + households: + household: + members: [head, child] + state_code: ME + output: + ctc_individual_maximum: [0, 0] + me_dependent_exemption_credit_amount_person: [0, 0] + me_dependent_exemption_credit: 0 + +- name: Child of a joint return where one spouse has no TIN gets no credit in 2025 + # Each spouse on a joint return needs an SSN or ITIN for either federal credit. + period: 2025 + input: + people: + head: + age: 30 + spouse: + age: 30 + ssn_card_type: NONE + has_tin: false + child: + age: 8 + is_tax_unit_dependent: true + tax_units: + tax_unit: + members: [head, spouse, child] + filing_status: JOINT + households: + household: + members: [head, spouse, child] + state_code: ME + output: + ctc_individual_maximum: [0, 0, 0] + me_dependent_exemption_credit_amount_person: [0, 0, 0] + me_dependent_exemption_credit: 0 + +- name: Child with an SSN of a head of household with an ITIN gets the credit in 2025 + # The filer has no valid SSN, so IRC 24(h)(7) denies the Child Tax Credit and + # IRC 24(h)(4)(C) allows the $500 credit for other dependents. The child is under + # 6, so the Maine credit is 2 x $305. + period: 2025 + input: + people: + head: + age: 30 + ssn_card_type: OTHER_NON_CITIZEN + child: + age: 3 + is_tax_unit_dependent: true + ssn_card_type: CITIZEN + tax_units: + tax_unit: + members: [head, child] + filing_status: HEAD_OF_HOUSEHOLD + households: + household: + members: [head, child] + state_code: ME + output: + ctc_qualifying_child: [false, false] + ctc_individual_maximum: [0, 500] + me_dependent_exemption_credit_amount_person: [0, 610] + me_dependent_exemption_credit: 610 + +- name: 17-year-old dependent with an SSN gets the credit in 2025 + # The child is too old for the Child Tax Credit and gets the credit for other + # dependents. + period: 2025 + input: + people: + head: + age: 45 + spouse: + age: 45 + child: + age: 17 + is_tax_unit_dependent: true + tax_units: + tax_unit: + members: [head, spouse, child] + filing_status: JOINT + households: + household: + members: [head, spouse, child] + state_code: ME + output: + ctc_qualifying_child: [false, false, false] + ctc_individual_maximum: [0, 0, 500] + me_dependent_exemption_credit_amount_person: [0, 0, 305] + me_dependent_exemption_credit: 305 diff --git a/policyengine_us/variables/gov/states/me/tax/income/credits/dependent_exemption/me_dependent_exemption_credit_amount_person.py b/policyengine_us/variables/gov/states/me/tax/income/credits/dependent_exemption/me_dependent_exemption_credit_amount_person.py index 2c9b973e63a..7a80b04c9cd 100644 --- a/policyengine_us/variables/gov/states/me/tax/income/credits/dependent_exemption/me_dependent_exemption_credit_amount_person.py +++ b/policyengine_us/variables/gov/states/me/tax/income/credits/dependent_exemption/me_dependent_exemption_credit_amount_person.py @@ -7,23 +7,37 @@ class me_dependent_exemption_credit_amount_person(Variable): unit = USD label = "Maine dependent exemption credit amount for each person" reference = ( - "https://www.mainelegislature.org/legis/statutes/36/title36sec5219-SS.html" + "https://www.mainelegislature.org/legis/statutes/36/title36sec5219-SS.html", + # 2025 Form 1040ME Instructions, line 13a and Schedule A, lines 1 + # and 10. PDF pages 5, 10. + "https://www.maine.gov/revenue/sites/maine.gov.revenue/files/inline-files/25_1040me_gen_instr_w_cover_pg.pdf#page=5", + # 2025 Dependent Exemption Tax Credit Worksheet, lines 1 and 3. + "https://www.maine.gov/revenue/sites/maine.gov.revenue/files/inline-files/25_dependent_exemption_tx_cr_fillable.pdf#page=1", + # 2025 Instructions for Schedule 8812, TIN Required by Due Date of + # Your Return To Claim the ODC, and Credit for Other Dependents. + # PDF pages 1-2. + "https://www.irs.gov/pub/irs-pdf/i1040s8.pdf#page=1", ) definition_period = YEAR defined_for = "is_tax_unit_dependent" def formula(person, period, parameters): - dependent = person("is_tax_unit_dependent", period) - # 36 MRSA 5219-SS counts each "qualifying child and dependent" for - # whom the taxpayer is eligible to claim the federal child tax credit - # or credit for other dependents; a return on which the filer (or, if - # joint, either spouse) can be claimed as a dependent has no - # dependents (IRC 152(b)(1)). - dependent_filer = person.tax_unit( - "head_or_spouse_is_dependent_elsewhere_without_filing_exception", period - ) - dependent = dependent & ~dependent_filer + # 36 MRSA 5219-SS allows the credit for each "qualifying child and + # dependent of the taxpayer for whom the taxpayer was eligible to + # claim the federal child tax credit pursuant to the Code, Section + # 24". The worksheet counts the dependents on Form 1040ME line 13a, + # which counts each dependent for whom the filer is eligible to claim + # "the federal child tax credit or the credit for other dependents". + # So a dependent counts when either credit is allowed for that person + # before the phase-out. This applies the federal identification + # tests: the dependent needs an SSN, ITIN or ATIN, and the filer (on + # a joint return, each spouse) an SSN or ITIN (IRC 24(e); Schedule + # 8812 instructions). A child whose filer has no valid SSN still + # counts through the credit for other dependents (IRC 24(h)(4)(C), + # 24(h)(7)). A return on which a filer can be claimed as a dependent + # has no dependents (IRC 152(b)(1)). + section_24_amount = person("ctc_individual_maximum", period) p = parameters(period).gov.states.me.tax.income.credits.dependent_exemption age = person("age", period) multiplier = p.multiplier.calc(age) - return dependent * multiplier * p.amount + return (section_24_amount > 0) * multiplier * p.amount