Maine Use Tax Calculator (2018)
A tool to accurately calculate the Maine use tax for items purchased out-of-state in 2018, based on the 5.5% general sales tax rate applicable for that year.
Enter the total cost of the item or service before any taxes.
Enter the amount of sales tax you already paid elsewhere. Enter 0 if none.
This calculator is for informational purposes for the 2018 tax year. Consult a tax professional for advice.
What is the Maine Use Tax?
The Maine use tax is a counterpart to the sales tax. It applies to the value of tangible personal property or taxable services purchased outside of Maine but brought into the state for use, storage, or consumption. If you buy an item from an online retailer or in another state and don’t pay Maine’s sales tax at the time of purchase, you are legally obligated to pay the use tax directly to Maine Revenue Services. The purpose of the use tax is to ensure that all purchases, regardless of where they are made, are taxed fairly and equally, protecting local Maine businesses from unfair competition. For the tax year 2018, the general use tax rate was 5.5%, the same as the general sales tax rate.
Maine Use Tax Formula and Explanation (2018)
The calculation for the Maine use tax is straightforward. It is based on the purchase price of the item and gives credit for any sales tax already paid to another state. The formula for the 2018 tax year is:
Use Tax Due = (Purchase Price × 0.055) − Sales Tax Paid Elsewhere
This formula ensures you only pay the difference between what is owed in Maine and what you have already paid.
| Variable | Meaning | Unit | Typical Range |
|---|---|---|---|
| Purchase Price | The original, pre-tax cost of the item or service. | USD ($) | $1 – $100,000+ |
| Maine Use Tax Rate | The applicable tax rate for 2018. | Percentage (%) | 5.5% (general rate) |
| Sales Tax Paid Elsewhere | The sales tax amount you paid in another state or jurisdiction. | USD ($) | $0 and up |
Practical Examples
Example 1: Online Purchase without Sales Tax
Imagine you purchased a laptop online in 2018 for $2,000. The seller was located out-of-state and did not collect any sales tax on the transaction.
- Inputs: Purchase Price = $2,000; Sales Tax Paid Elsewhere = $0.
- Calculation: ($2,000 × 0.055) – $0 = $110.
- Result: You would owe $110 in Maine use tax.
Example 2: Purchase in Another State with Sales Tax Paid
Suppose you were in New Hampshire (which has no sales tax) and drove to Massachusetts to buy furniture for $1,000 in 2018. Massachusetts’ sales tax rate was 6.25%, so you paid $62.50 in sales tax there.
- Inputs: Purchase Price = $1,000; Sales Tax Paid Elsewhere = $62.50.
- Maine Gross Tax: $1,000 × 0.055 = $55.00.
- Calculation: $55.00 (Maine Tax) – $62.50 (MA Tax Paid) = -$7.50.
- Result: Because the tax paid in Massachusetts ($62.50) is more than what would be due in Maine ($55.00), your use tax due is $0. You do not get a refund for the difference. For more information, check out our sales tax calculator.
How to Use This calculate maine use tax 2018 Calculator
Using this tool is simple and provides instant results for your 2018 tax obligations.
- Enter Purchase Price: In the first field, input the total cost of the item you purchased. Do not include any shipping fees if they were stated separately on the invoice.
- Enter Sales Tax Paid: In the second field, input the total amount of sales tax you paid to another state or jurisdiction. If no tax was paid, enter “0”.
- Review Results: The calculator will instantly display the “Total Maine Use Tax Due”. It will also show a breakdown of the gross tax calculated and the credit applied from tax paid elsewhere.
Key Factors That Affect Maine Use Tax
- Purchase Location: The tax primarily applies to items bought from other states, through mail-order catalogs, or online where Maine sales tax was not collected.
- Sales Tax Paid in Another State: Maine provides a credit for sales tax legally paid in another state, up to the amount of the Maine tax due. If you paid a higher tax rate elsewhere, you owe nothing to Maine.
- Type of Item or Service: Most tangible personal property is subject to use tax. However, some items like grocery staples, prescription medicines, and certain medical devices are exempt.
- Shipping and Handling Charges: Separately stated shipping charges via a common carrier are generally not taxable in Maine. However, handling fees may be.
- Date of Purchase: Tax rates can change. This calculator is specifically calibrated for the 5.5% general rate that was effective during 2018.
- Use in Maine: The tax applies if the item is brought into Maine for use, storage, or consumption within the state. A property tax calculator can help with related real estate taxes.
Frequently Asked Questions (FAQ)
What was the Maine use tax rate in 2018?
For 2018, the general Maine sales and use tax rate was 5.5%. Certain items like prepared food and lodging had a higher rate of 8%.
Do I have to pay use tax if I paid sales tax in another state?
It depends. You can take a credit for sales tax paid to another state. If the tax you paid is less than the 5.5% Maine rate, you owe the difference. If it’s equal to or greater than the Maine rate, you owe nothing. You cannot get a refund for the excess tax paid.
What items are exempt from Maine use tax?
Common exemptions include “grocery staples,” prescription medications, prosthetic devices, and fuel purchased for heating. Sales to government agencies and certain non-profits are also exempt.
How do I pay the Maine use tax?
Use tax is typically reported on your Maine individual income tax return (Form 1040ME). There is a specific line item for declaring and paying use tax on your out-of-state purchases.
What happens if I don’t pay use tax?
Failure to pay use tax can result in a bill from Maine Revenue Services for the unpaid tax, plus interest and potential penalties.
Are shipping and handling charges taxable?
Shipping charges are not taxable in Maine if they are separately stated on the invoice and the delivery is made by a common carrier (like USPS, UPS, or FedEx). However, combined “shipping and handling” fees may be taxable.
Does this tax apply to vehicles purchased out of state?
Yes. When you register a vehicle in Maine that was purchased out of state within the last 12 months, you will be required to pay the use tax on the purchase price, with credit for any sales tax paid to the other state.
Is there a minimum purchase amount before use tax applies?
No, there is no minimum. Technically, use tax is due on any purchase, no matter how small, if Maine sales tax was not collected by the seller.