Complete Guide to Maine LLC Taxes in 2025
Maine offers a moderate tax environment for LLC owners, with graduated individual income tax rates ranging from 5.8% to 7.15%, an $85 annual report fee, and no entity-level tax on LLCs. The Pine Tree State's three-bracket system provides a somewhat progressive structure that is higher than many states but lower than nearby Connecticut, Massachusetts, and New York at the top end. This comprehensive guide covers everything Maine LLC owners need to know about their state tax obligations.
How Maine Taxes LLCs
Maine follows federal classification, treating LLCs as pass-through entities. Single-member LLCs report on Maine Form 1040ME; multi-member LLCs file Maine Form 1065ME (informational) with K-1s to members. Maine does not impose a franchise tax, gross receipts tax, or entity-level tax on pass-through LLCs.
Maine Income Tax Brackets
| Taxable Income (Single) | Rate |
|---|---|
| $0 - $26,050 | 5.80% |
| $26,051 - $61,600 | 6.75% |
| Over $61,600 | 7.15% |
For married filing jointly, thresholds roughly double ($52,100 and $123,250). Maine indexes these brackets annually for inflation.
Key Point: Maine's top rate of 7.15% kicks in at a relatively low income threshold ($61,600 single). This means most profitable LLC owners will hit the top rate. However, Maine's top rate is still lower than neighboring Massachusetts (5% flat, but with 4% surtax above $1M), Vermont (8.75% top), and New York (10.9% top).
Federal Taxes for Maine LLC Owners
- Self-Employment Tax: 15.3% (12.4% SS + 2.9% Medicare + 0.9% surtax)
- Federal Income Tax: 10-37% graduated brackets
- QBI Deduction: Up to 20% under Section 199A
Tax Tip: Maine's 7.15% top rate makes S-Corp election particularly valuable for higher-income LLC owners. The SE tax savings combined with state tax planning can be substantial. Use our S-Corp Tax Calculator to compare.
Maine LLC Filing Requirements
Maine LLCs file an Annual Report with the Maine Secretary of State. The fee is $85. The report is due by June 1 of each year (not the formation anniversary). Late filing incurs penalties and can lead to administrative revocation.
Maine LLC Filing Deadlines
| Filing | Deadline | Extension |
|---|---|---|
| Individual (1040ME) | April 15 | Yes, to October 15 |
| Partnership (1065ME) | March 15 | Yes, to September 15 |
| Annual Report | June 1 | No extension |
| Estimated Tax | Apr 15, Jun 15, Sep 15, Jan 15 | No |
Maine vs. Neighboring States
| State | Income Tax | Annual Fee | Entity Tax |
|---|---|---|---|
| Maine | 5.8-7.15% | $85 | None |
| New Hampshire | 0% (no income tax) | $100 | BPT 7.5%/BET 0.5% |
| Massachusetts | 5% + 4% surtax | $500 | None |
| Vermont | 3.35-8.75% | $35 | None |
| Connecticut | 3-6.99% | $80 | $250 minimum |
Maine PTET Election
Maine offers a Pass-Through Entity Tax election allowing eligible LLCs to pay state income tax at the entity level as a SALT cap workaround. The election is made annually and provides members with a credit on their individual returns.
Maine Business Incentives
- Pine Tree Development Zone: Tax incentives for businesses in qualified zones including income tax credits
- Research Expense Tax Credit: Credit for qualified research activities in Maine
- Seed Capital Tax Credit: For investments in Maine businesses
- Employment Tax Increment Financing (ETIF): Reimbursement of withholding taxes for job creation
Common Maine LLC Tax Mistakes
- Underestimating state tax burden: Maine's 7.15% top rate starts at just $61,600 -- most LLC owners hit it quickly.
- Missing the June 1 annual report: Maine uses June 1, not the formation anniversary.
- Not evaluating PTET election: Important for LLC owners above the $10,000 SALT cap.
- Ignoring estimated payments: Required if you expect to owe $1,000+.
- Overlooking Maine's standard deduction: Maine uses federal standard deduction amounts, which can differ from prior years.
Dissolving a Maine LLC
File a Certificate of Cancellation with the Maine Secretary of State ($75). File final returns with Maine Revenue Services, marking them as "final." Retain records for the applicable statute of limitations period (three years).