Maine disaster relief compensation exemption applicable to COVID-19 emergency
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Thursday, May 21, 2020

Maine disaster relief compensation exemption applicable to COVID-19 emergency

By Payroll and Entitlements Editorial Staff

Maine Revenue Services has revised its COVID-19 FAQs to discuss the personal income tax exemption for a nonresident’s income earned when conducting trade or business in the state during a disaster period.

Statutory exemption for nonresidents performing disaster-related services. Maine law provides that certain compensation for personal services performed in Maine as an employee and certain income from a trade or business conducted in Maine are exempt from state income tax during a disaster period.

Specifically, the taxpayer must be a nonresident whose presence in Maine during the tax year is for the sole purpose of performing services or conducting business during a disaster period, and whose compensation or income is directly related to a declared state disaster or emergency at the request of either:

  • the state;
  • a county, city, town, or political subdivision of the State; or
  • a registered business.

Exemption applicable to COVID-19 disaster services. The exemption from Maine income tax is available during the COVID-19 disaster period. Currently, the disaster period runs for 60 days beginning with the date of the governor’s proclamation of a state of emergency on March 15, 2020. (Coronavirus (COVID-19) FAQs, Maine Revenue Services, May 7, 2020).

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