State Taxes

Taxes in Maine: State Tax Guide 2026

Updated 2026-03-10

Data Notice: Figures, rates, and statistics cited in this article are based on the most recent available data at time of writing and may reflect projections or prior-year figures. Always verify current numbers with official sources before making financial, medical, or educational decisions.

Taxes in Maine: State Tax Guide 2026

Tax information is for educational purposes only and does not constitute tax advice. Consult a licensed tax professional for your specific situation.

Maine has a moderately high overall tax burden, with a progressive income tax topping out at 7.15%, a 5.50% sales tax, and property tax rates that rank among the highest in New England. However, the state offers generous property tax relief programs and retirement income exclusions that can significantly reduce the burden for qualifying residents.

Maine Income Tax Rates (2026)

Maine uses a progressive income tax system with three brackets. Rates below are for single filers:

Tax RateTaxable Income Range
5.80%$0 – ~$24,500
6.75%~$24,501 – ~$58,050
7.15%Over ~$58,050

Married filing jointly thresholds are approximately double these amounts.

Maine’s brackets are indexed for inflation annually.

Maine Standard Deduction (2026)

Maine conforms to the federal standard deduction amounts:

Filing StatusAmount
Single~$15,000
Married Filing Jointly~$30,000
Head of Household~$22,500

Maine’s standard deduction is phased out for high-income taxpayers, beginning at ~$87,150 (single) and ~$174,300 (married filing jointly).

Notable Maine Tax Credits

  • Earned Income Tax Credit: Maine offers a state EITC equal to 12% of the federal credit (25% for workers without qualifying children)
  • Property Tax Fairness Credit: Up to $1,000 ($1,500 for age 65+) refundable credit for property taxes or rent exceeding a percentage of income
  • Child Care Credit: 25% of the federal child care credit
  • Educational Opportunity Tax Credit: Credit for student loan payments made by residents who earned an associate’s degree or higher in Maine
  • Research Expense Credit: 5% credit for qualifying research expenditures

Sales Tax

ComponentRate
State base rate5.50%
Local rate0.00%
Combined rate5.50%

Maine has a uniform statewide sales tax with no local additions, making it simple and predictable.

Exempt from sales tax: Groceries, prescription medications, heating fuel (residential), and most clothing. Maine also hosts a sales tax holiday weekend in August.

Meals and lodging: A higher rate of 8.00% applies to prepared food, short-term lodging, and auto rentals.

Property Tax

MetricAmount
Average effective rate~1.24%
National average0.99%

Maine has property taxes well above the national average, which reflects the state’s heavy reliance on property taxes to fund local services and education.

Relief Programs

  • Homestead Exemption: ~$25,000 off assessed value for owner-occupied primary residences (must have owned and occupied for 12+ months)
  • Property Tax Fairness Credit: Refundable income tax credit for property taxes or rent exceeding a percentage of income
  • Maine Residents Property Tax and Rent Refund Program: Additional relief for seniors and disabled residents
  • Veterans exemption: ~$6,000 off assessed value for qualifying veterans

Example: A home valued at $300,000 with a $25,000 homestead exemption has a taxable value of $275,000. At the ~1.24% effective rate, annual property tax is approximately ~$3,410.

How Maine Compares to National Averages

Tax TypeMaineNational Average
Top income tax rate7.15%~5.0%
Effective rate (~$75K single)~5.8%~3.5%
Sales tax (combined avg)5.50%6.6%
Property tax (effective)~1.24%0.99%
Overall tax burden rankTop 10 highest—

Who Benefits from Living in Maine

Maine may work well for:

  • Retirees — Social Security is tax-free, pension income up to ~$25,000 is deductible, and the Property Tax Fairness Credit provides meaningful relief
  • Lower-income families — The state EITC, Property Tax Fairness Credit, and grocery exemption provide significant support
  • Recent graduates — The Educational Opportunity Tax Credit offsets student loan payments for Maine-educated residents
  • Shoppers — Sales tax at 5.50% is below the national average, with most groceries and clothing exempt
  • Homeowners using relief programs — Combining the homestead exemption with the Property Tax Fairness Credit can substantially reduce the effective property tax burden

Maine may be costly for:

  • High earners — The 7.15% top rate kicks in at just ~$58,050, meaning moderate earners face the top bracket
  • Property owners without exemptions — The ~1.24% effective rate is 25% above the national average
  • Vacation homeowners — No homestead exemption on second homes, and short-term rental income faces the 8% lodging tax
  • High-income retirees — The standard deduction phases out at higher income levels

Maine-Specific Considerations

  • No tax on Social Security benefits — Maine fully exempts Social Security income from state tax
  • Pension income deduction — Up to $25,000 of pension income can be deducted ($50,000 for married filing jointly), reduced dollar-for-dollar by Social Security benefits received
  • No state estate tax below threshold — Maine imposes an estate tax on estates exceeding ~$6.41 million (indexed for inflation) with a top rate of 12%
  • Meals and lodging tax — 8% rate on restaurants, hotels, and short-term rentals
  • Educational Opportunity Tax Credit — Unique credit for student loan payments, encouraging graduates to remain in Maine
  • Pine Tree Development Zone credits — Tax incentives for businesses locating in designated development zones

Key Takeaways

  • Maine’s top income tax rate of 7.15% applies to income over ~$58,050, a relatively low threshold
  • Sales tax at 5.50% is below the national average, with groceries, clothing, and prescription drugs exempt
  • Property taxes at ~1.24% are well above the national average, but multiple relief programs exist
  • Social Security benefits are fully exempt and pensions qualify for a deduction up to ~$25,000
  • The Property Tax Fairness Credit and Educational Opportunity Tax Credit are uniquely valuable Maine programs
  • Maine imposes a state estate tax on estates over ~$6.41 million

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