Count dependents for the credit for other dependents in the Maine fairness credits

changelog.d/me-fairness-credit-odc-dependents.fixed.md

@@ -0,0 +1 @@
+Count dependents who get the federal credit for other dependents, not only Child Tax Credit children, for the Maine sales tax and property tax fairness credits.

policyengine_us/tests/policy/baseline/gov/states/me/tax/income/credits/fairness/me_fairness_credit_qualifying_children.yaml

@@ -1,8 +1,10 @@
 # 36 MRSA 5213-A(1)(A-1)(2) and 5219-KK(1)(A-1)(2)-(3) count each "qualifying child
 # or dependent" for whom the filer can claim the federal credit under section 24,
-# which includes the credit for other dependents. A child whose filer fails the
-# Child Tax Credit SSN rule gets that credit (IRC 24(h)(4)(C)) if the filer has an
-# SSN or ITIN, so the child still counts (issue #9403).
+# which includes the credit for other dependents. Form 1040ME line 13a counts each
+# dependent for the Child Tax Credit or the credit for other dependents. A child
+# whose filer fails the Child Tax Credit SSN rule gets that credit (IRC 24(h)(4)(C))
+# if the filer has an SSN or ITIN, so the child still counts (issue #9403). Older
+# dependents and children without an SSN count when they have a TIN.
 - name: Maine counts the child of a joint return where neither spouse has an SSN in 2025
   period: 2025
   input:
@@ -86,3 +88,180 @@
     ctc_qualifying_children: 1
     me_fairness_credit_qualifying_children: 1
     me_sales_tax_fairness_credit: 250
+
+- name: Maine counts a 17-year-old dependent who gets the credit for other dependents in 2025
+  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
+        me_sales_and_property_tax_fairness_credit_income: 10_000
+    households:
+      household:
+        members: [head, spouse, child]
+        state_code: ME
+  output:
+    ctc_qualifying_children: 0
+    me_fairness_credit_qualifying_children: 1
+    # 2025 Schedule PTFC/STFC line 8 table, joint, line 13a is 1: $4,050.
+    me_property_tax_fairness_credit_benefit_base: 4_050
+    # 2025 Schedule PTFC/STFC line 17 table, joint, $0-$50,950, line 13a is 1: $250.
+    me_sales_tax_fairness_credit: 250
+
+- name: Maine counts a child with an ITIN but no SSN in 2025
+  # IRC 24(h)(7) denies the Child Tax Credit; IRC 24(h)(4)(C) allows the credit for
+  # other dependents.
+  period: 2025
+  input:
+    people:
+      head:
+        age: 35
+      spouse:
+        age: 35
+      child:
+        age: 8
+        is_tax_unit_dependent: true
+        ssn_card_type: OTHER_NON_CITIZEN
+    tax_units:
+      tax_unit:
+        members: [head, spouse, child]
+        filing_status: JOINT
+        me_sales_and_property_tax_fairness_credit_income: 10_000
+    households:
+      household:
+        members: [head, spouse, child]
+        state_code: ME
+  output:
+    ctc_qualifying_children: 0
+    me_fairness_credit_qualifying_children: 1
+    me_sales_tax_fairness_credit: 250
+
+- name: Maine counts an adult dependent with a child for a head of household in 2025
+  period: 2025
+  input:
+    people:
+      head:
+        age: 45
+      adult_dependent:
+        age: 20
+        is_tax_unit_dependent: true
+      child:
+        age: 10
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [head, adult_dependent, child]
+        filing_status: HEAD_OF_HOUSEHOLD
+        me_sales_and_property_tax_fairness_credit_income: 10_000
+    households:
+      household:
+        members: [head, adult_dependent, child]
+        state_code: ME
+  output:
+    ctc_qualifying_children: 1
+    me_fairness_credit_qualifying_children: 2
+    # 2025 Schedule PTFC/STFC line 8 table, head of household, line 13a is more
+    # than 1: $4,050.
+    me_property_tax_fairness_credit_benefit_base: 4_050
+    # 2025 Schedule PTFC/STFC line 17 table, head of household, $0-$38,200, line
+    # 13a is 2: $250.
+    me_sales_tax_fairness_credit: 250
+
+- name: Maine does not count a dependent without any TIN in 2025
+  # The credit for other dependents requires the dependent's SSN, ITIN or ATIN.
+  period: 2025
+  input:
+    people:
+      head:
+        age: 45
+      spouse:
+        age: 45
+      child:
+        age: 17
+        is_tax_unit_dependent: true
+        ssn_card_type: NONE
+        has_tin: false
+    tax_units:
+      tax_unit:
+        members: [head, spouse, child]
+        filing_status: JOINT
+        me_sales_and_property_tax_fairness_credit_income: 10_000
+    households:
+      household:
+        members: [head, spouse, child]
+        state_code: ME
+  output:
+    ctc_qualifying_children: 0
+    me_fairness_credit_qualifying_children: 0
+    me_property_tax_fairness_credit_benefit_base: 3_300
+    me_sales_tax_fairness_credit: 215
+
+- name: Maine counts the Child Tax Credit child and the older dependent with a TIN in 2025
+  period: 2025
+  input:
+    people:
+      head:
+        age: 45
+      spouse:
+        age: 45
+      child:
+        age: 8
+        is_tax_unit_dependent: true
+      teen:
+        age: 17
+        is_tax_unit_dependent: true
+      adult_dependent:
+        age: 19
+        is_tax_unit_dependent: true
+        ssn_card_type: NONE
+        has_tin: false
+    tax_units:
+      tax_unit:
+        members: [head, spouse, child, teen, adult_dependent]
+        filing_status: JOINT
+        me_sales_and_property_tax_fairness_credit_income: 10_000
+    households:
+      household:
+        members: [head, spouse, child, teen, adult_dependent]
+        state_code: ME
+  output:
+    ctc_qualifying_children: 1
+    me_fairness_credit_qualifying_children: 2
+    # 2025 Schedule PTFC/STFC line 17 table, joint, $0-$50,950, line 13a is 2+: $280.
+    me_sales_tax_fairness_credit: 280
+
+- name: Maine counts only Child Tax Credit children before the credit for other dependents in 2017
+  # IRC 24(h)(4) applies from 2018, so a 17-year-old dependent does not count in 2017.
+  period: 2017
+  input:
+    people:
+      head:
+        age: 45
+      spouse:
+        age: 45
+      child:
+        age: 8
+        is_tax_unit_dependent: true
+      teen:
+        age: 17
+        is_tax_unit_dependent: true
+    tax_units:
+      tax_unit:
+        members: [head, spouse, child, teen]
+        filing_status: JOINT
+    households:
+      household:
+        members: [head, spouse, child, teen]
+        state_code: ME
+  output:
+    ctc_qualifying_children: 1
+    me_fairness_credit_qualifying_children: 1

policyengine_us/variables/gov/states/me/tax/income/credits/fairness/me_fairness_credit_qualifying_children.py

@@ -4,12 +4,12 @@
 class me_fairness_credit_qualifying_children(Variable):
     value_type = int
     entity = TaxUnit
-    label = "Maine sales and property tax fairness credit qualifying children"
+    label = "Maine sales and property tax fairness credit qualifying children and dependents"
     documentation = (
-        "Number of qualifying children for whom the filer can claim a federal "
-        "credit under IRC section 24 (the Child Tax Credit or the credit for "
-        "other dependents), for the Maine sales tax and property tax fairness "
-        "credits."
+        "Number of qualifying children and dependents for whom the filer can "
+        "claim a federal credit under IRC section 24 (the Child Tax Credit or "
+        "the credit for other dependents), for the Maine sales tax and "
+        "property tax fairness credits."
     )
     definition_period = YEAR
     defined_for = StateCode.ME
@@ -18,6 +18,12 @@ class me_fairness_credit_qualifying_children(Variable):
         "https://legislature.maine.gov/statutes/36/title36sec5213-A.html",
         # 36 MRSA 5219-KK(1)(A-1)(2) and (3).
         "https://legislature.maine.gov/statutes/36/title36sec5219-KK.html",
+        # 2025 Form 1040ME Instructions, line 13a, Property Tax Fairness
+        # Credit and Sales Tax Fairness Credit. PDF pages 5, 11.
+        "https://www.maine.gov/revenue/sites/maine.gov.revenue/files/inline-files/25_1040me_gen_instr_w_cover_pg.pdf#page=5",
+        # 2025 Schedule PTFC/STFC, line 8, line 17 and instructions.
+        # PDF pages 2-4.
+        "https://www.maine.gov/revenue/sites/maine.gov.revenue/files/inline-files/25_1040me_sch_ptfc_fillable.pdf#page=2",
         # 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.
@@ -29,17 +35,15 @@ def formula(tax_unit, period, parameters):
         # 36 MRSA 5213-A(1)(A-1)(2) and 5219-KK(1)(A-1)(2)-(3) count each
         # "qualifying child or dependent" for whom the filer "can claim the
         # federal child tax credit pursuant to the Code, Section 24". Section
-        # 24 includes the credit for other dependents of IRC 24(h)(4), and IRC
-        # 24(h)(4)(C) gives that credit for a child whose Child Tax Credit is
-        # denied by the social security number rule of IRC 24(h)(7). So a
-        # child whose filer fails the Child Tax Credit identification test
-        # still counts when the filer meets the taxpayer identification test
-        # for the credit for other dependents. Dependents who are not CTC
-        # qualifying children are not counted here.
-        qualifying_child = person(
-            "ctc_qualifying_child_ignoring_filer_identification", period
-        )
-        filer_meets_identification_requirements = tax_unit(
-            "filer_meets_ctc_identification_requirements", period
-        )
-        return tax_unit.sum(qualifying_child) * filer_meets_identification_requirements
+        # 24 includes the credit for other dependents of IRC 24(h)(4), and the
+        # Form 1040ME line 13a instructions count 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: a child
+        # under 17, a child with an ITIN but no SSN, a child whose filer fails
+        # the Child Tax Credit SSN rule (IRC 24(h)(4)(C)), or an older
+        # dependent. The dependent and the filer still need a TIN (IRC 24(e)).
+        # The credit for other dependents starts in 2018, so earlier years
+        # count only Child Tax Credit children.
+        section_24_amount = person("ctc_individual_maximum", period)
+        return tax_unit.sum(section_24_amount > 0)