Free Maine Rew 5 Form in PDF Open Maine Rew 5 Editor Now

Free Maine Rew 5 Form in PDF

The Maine REW 5 form is a crucial document for individuals selling real estate in Maine who wish to request an exemption or reduction in the withholding of state income tax on the sale. This form must be submitted to Maine Revenue Services no fewer than five business days before closing to ensure proper processing. Understanding the requirements and instructions for this form can help sellers navigate the tax implications of their real estate transactions effectively.

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Table of Contents

The Maine REW 5 form is an essential document for anyone looking to sell real property in Maine while being a non-resident of the state. This form allows sellers to request an exemption or reduction in the withholding of Maine income tax that is typically applied to the sale of real estate. The withholding rate is generally set at 2.5% of the total consideration, but sellers may seek a reduced rate based on their specific tax situation. To initiate this process, the form must be submitted at least five business days prior to the closing date. In addition to basic seller information, the form requires details about the property being sold, including its physical address and ownership history. Sellers must also provide documentation related to their acquisition of the property, any capital improvements made, and the anticipated closing costs. If applicable, the form allows for the designation of a representative to assist with the withholding process, ensuring that all necessary information is communicated effectively. Completing the Maine REW 5 form accurately is crucial, as it helps avoid unnecessary withholding and potential tax liabilities, making it an important step in the real estate transaction process.

Form Sample

Request for Exemption or Reduction in
Withholding of Maine Income Tax on the
Disposition of Maine Real Property
2025
Form REW-5
File Form REW-5 online at revenue.maine.gov.
Municipality/Township
a) Purchase
b) Inheritance: ( )
Decedent’s name SSN
c) Gift or other
Closing date
Date and method of acquisition. Enter the date the applicant originally acquired the property and check the box that indicates the
applicant’s method of acquisition. Additional documentation may be requested to verify the original acquisition. See instructions.
d) Like-kind exchange
6. Original purchase price/basis. See instructions ......................................................................... 6. $ .00
7. Applicant’s allowable closing costs from original purchase of property. See instructions ..........7. $ .00
8. Capital improvements. See instructions ....................................................................................8. $ .00
9. Add lines 6, 7, and 8 ..................................................................................................................9. $ .00
10a.
Length of time during the applicant’s ownership that the property was used for rental or
commercial use. If there was no rental/commercial use, continue to line 11..............................10a.
years months
10b. Allowed or allowable accumulated depreciation. See instructions ........................................10b. $ .00
Applicant’s rst name (if applicable) SSN or federal EIN
Applicant spouse’s last name (if applicable) Spouse’s rst name Spouse’s SSN
City/Town State Zip Code
Applicant’s daytime phone number
Note: This form is for sales occurring in 2025; submissions led on a prior year form may be subject to delay. This form must be
submitted at least 5 business days before the closing date. If mailed, please allow an additional 2 to 3 weeks for processing.
Continue on Form REW-5, page 2
Applicant’s mailing address (number and street)
Applicant’s last name (or name of entity)
Applicant’s email address
Buyer(s) name(s)
Physical address of property
4. Date of acquisition or date of decedent’s death. See instructions ...............................................4.
5. Method of acquisition:
(check one)
Name(s) of all other sellers (if applicable)
1a.
2.
3.
99
*2402400*
1. Applicant’s percentage of ownership. (If less than 100.00%, line 1a must be completed.) .........1. . %
Check here if applicant is a corporation required to le Form 1120ME ................................................................................
Clear
Print
Country (if not United States) Email address Telephone number
Representative name (and title, if applicable) Firm or company name
Representative’s mailing address (number and street) City/Town State Zip Code
2025 Form REW-5, Page 2
Applicant’s SSN or EIN
Under penalties of perjury, I declare that I have examined this application and attached schedules and statements, and to the best of
my knowledge and belief they are true, correct and complete. If you are signing on behalf of the applicant(s), you must provide a written
power of attorney authorization with this request. To assign a designated representative, complete the Representative Information and
Limited Power of Attorney below. You must sign the authorization or complete Form 2848-ME (available at maine.gov/revenue/tax-return-
forms/general-forms) before MRS can speak with your designated representative. If you are signing on behalf of your employer, include
authorization.
Applicant’s signature Applicant’s name Date
This request for a withholding rate reduction or exemption is submitted in accordance with 36 M.R.S. §§ 5250-A(3)(B) and (4), which
authorizes the State Tax Assessor to issue a certicate of exemption or reduction in the amount of tax to be withheld. The rate of
withholding is 2.5% of the total consideration or, at the request of the seller, the State Tax Assessor may authorize a reduced
amount of withholding equal to the gain multiplied by 7.15% for individuals or 8.93% for a C corporation, in calendar year 2025.
11. Adjusted basis. Subtract line 10b from line 9 ........................................................................11. $ .00
12. Total sales price. See instructions ...........................................................................................12. $ .00
13. Applicant’s estimated allowable current closing costs. See instructions .................................13. $ .00
14. Amount realized. Subtract line 13 from line 12 ......................................................................14. $ .00
15. Estimated gain/loss subject to federal and Maine income tax. Subtract line 11 from
line 14 ......................................................................................................................................15. $ .00
16. How will this sale of real property be reported on the applicant’s federal income tax return? See instructions.
Limited Power of Attorney (complete only if you want someone to represent you during the real estate withholding process)
By signing below, the selling party appoints the individual named in the Representative Information section below to act as their
representative with authority to receive condential information and to discuss your tax records, related to this form, with MRS. I understand
that my representative may not act on my behalf, unless I provide a Form 2848-ME, Power of Attorney. I also understand that signing this
form does not revoke other power of attorney forms on le with MRS.
Applicant’s signature Print name (and title, if applicable) Date
Applicant spouse’s signature (if applicable) Print name (and title, if applicable) Date
Representative Information
99
*2402401*
Revised: December 2024
Purpose of Form: To request an exemption or reduction in
withholding of Maine income tax on the disposition of Maine
real property.
Who may File: A seller (individual, rm, partnership,
association, society, club, corporation, estate, trust, business
trust, receiver, assignee or any other group or combination
acting as a unit) of Maine real property who, at the time of
closing, is a nonresident of Maine.
When to File: Form REW-5 should be led as soon as the
seller and buyer have reached an agreement to transfer
property. Sellers must allow MRS at least ve business days
to respond to a Form REW-5 request. The response time will
be longer if the request is missing required information or
supporting documentation. MRS will not issue a withholding
certicate after the sale has closed.
Maine Tax Portal (“MTP”): File Form
REW-5 electronically using the MTP at
revenue.maine.gov. If unable to le online,
you may send Form REW-5 and all supporting documents
via email to [email protected], fax to (207)
624-5062, or mail to Maine Revenue Services, Income/
Estate Tax Division - REW, P.O. Box 1060, Augusta, ME
04332-1060.
Withholding Certicate Issued by the State Tax
Assessor: A withholding certicate may be issued by the
2025 Form REW-5 General Instructions
State Tax Assessor to reduce or eliminate withholding on
transfers of Maine real property interests by nonresidents.
The certicate may be issued if:
1. No tax is due on the gain from the transfer; or,
2. Reduced withholding is appropriate because the
2.5% amount exceeds the seller’s maximum Maine
income tax liability on the gain realized from the
sale. The maximum income tax liability is equal to
the seller’s capital gain multiplied by 7.15% (8.93%
for corporations).
If one of the above is applicable, le Form REW-5 to apply
for the certicate no later than ve business days prior to
closing. Otherwise, do not le Form REW-5. The seller does
not qualify for an exemption or reduction in withholding.
Foreclosure Sale: If property is subject to foreclosure and
the consideration received for the property does not exceed
the debt secured by that property, no Maine income tax
withholding is required. Foreclosure sale means a sale of real
property incident to a foreclosure and includes a mortgagee’s
sale of real estate owned property of which the mortgagee,
or third-party entity, retained or took ownership as the result
of an unsuccessful attempt to sell the property at the time
of a previous foreclosure auction. MRS does not issue
withholding exemption certicates for this type of foreclosure
sale (see Rule 803 and 36 M.R.S. § 5250-A(3-A)).
2025 Form REW-5 Specic Instructions
Applicant’s name: Enter the applicant’s (seller’s) name and
SSN or federal EIN. NOTE: If there are multiple sellers of the
property, each applicant (seller) must complete a separate
Form REW-5, except that married taxpayers that will le
a joint Maine individual income tax return requesting a
withholding exemption or reduction may complete one form,
listing both names and SSN’s on the form.
Mailing address: Enter the applicant’s current mailing
address.
E-mail address: Provide the applicant’s email address,
or the email address of the applicant’s Power of Attorney
(POA). If using the POA’s email, be sure to include Form
REW-5, page 2 or a properly completed Form 2848-ME.
Lines 1a - 2. If applicant’s ownership percentage on line
1 is less than 100%, the names of all other sellers must
be included on line 1a. On line 2, enter the name(s) of all
buyer(s). The seller(s) and buyer(s) are typically listed on
the Purchase and Sale Agreement. Attach additional pages,
if necessary.
Line 3. Enter the address of the property for sale, the name
of the municipality where the property is located, and the
expected closing date of the sale.
Lines 4 - 5. Date and method of acquisition: Indicate the
date the property was originally acquired by the applicant
and the method by which the applicant obtained ownership
of the property.
Additional documentation may be requested to support the
method of acquisition, such as:
a) Purchase. Verication of the original sales price,
such as a HUD-1 Settlement Statement, dually signed
Purchase and Sales Agreement, original Real Estate
Transfer Tax Declaration (RETTD) or tax assessment
from the town when purchased.
b) Inheritance. A complete appraisal dated within six
months of the decedent’s death or a copy of the tax
assessment from the town.
c) Gift or other. Documents to verify the original
purchase price paid by the previous owner. If you cannot
locate these documents, the town where the property is
located may have a record of the purchase price.
d) Like-kind exchange. A copy of the federal Form
8824 that was led with the Internal Revenue Service
(“IRS”) to report the exchange.
3
Line 6. If line 5, box a (Purchase) is checked, enter the total
amount you paid for the property.
If line 5, box b (Inheritance) is checked, enter the fair market
value of the property on the date of the decedent’s death.
If line 5, box c (Gift or other) is checked, enter the adjusted
basis of the donor at the time of gift.
If line 5, box d (Like-kind exchange) is checked, enter the
basis of the property that was reported on federal Form
8824 in the year of the exchange.
Line 7. Enter the amount of the allowable closing costs
paid at the time the property was originally acquired by the
applicants.* Also see line 13.
Line 8. Enter the cost of capital improvements made to
the property. Do not include repairs made to the property.
For example: cleaning or xing a furnace is not a capital
improvement, but installing a new furnace is.
If you constructed a building after you acquired the property,
include the construction costs for the building.
You may be asked to provide additional information
supporting the amount entered on this line, such as a list
of capital improvements and the cost of each improvement,
and/or a copy of the construction contract, building permit
led with the town, or the tax assessment from the year a
certicate of occupancy was received.
Lines 10a - 10b. If the property was rented or used
commercially, enter the allowed, or allowable, accumulated
depreciation determined in accordance with the Internal
Revenue Code.
Line 12. Enter the total gross sales price of the property. Do
not subtract any fees. The sale price should match the sales
price on the Purchase and Sales Agreement.
Line 13. Enter the amount of the applicant’s allowable
closing costs from the current sale of this property.* Also see
line 7.
*Certain closing costs do not qualify. If available, enclose
a copy of the HUD-1 or Closing Statement from when you
purchased the property. Closing costs generally include
realtor fees, transfer taxes, and deed preparation fees.
Line 16. Indicate whether the sale will be reported as a
gain, loss, exclusion, installment sale, like-kind exchange,
or other on the applicant’s federal income tax return. If you
do not know how the sale will be reported on the applicant’s
federal income tax return, consult a tax professional or the
IRS.
For more information about selling the property, determining
basis, reporting the sale, capital improvements and costs,
visit irs.gov. See the instructions for the following federal
forms and publications:
• Publication 523 (Selling Your Home)
• Publication 544 (Sales and Other Dispositions of
Assets)
• Form 1040 (U.S. Individual Income Tax Return)
• Schedule D (Capital Gains and Losses)
• Form 4797 (Sales of Business Property)
• Form 8824 (Like-Kind Exchanges)
• Form 8949 (Sales and Other Dispositions of Capital
Assets)
Limited Power of Attorney & Representative Information.
Although not required, you may designate someone to
represent you during the real estate withholding process. To
do so, complete the Representative Information and Limited
Power of Attorney sections on Form REW-5, page 2. The
designated representative must be an individual, although
a rm cannot be designated as your representative, an
individual of a rm can be.
Appointing a Limited Power of Attorney designates a
representative to receive condential information and
to discuss tax records related to your Form REW-5 led
with MRS. The designated representative may not act on
your behalf, unless a completed Form 2848-ME (Power of
Attorney) is provided.
2025 Form REW-5 Specic Instructions, continued
4
Download PDF Form

Document Overview

Fact Name Fact Details
Form Purpose The REW-5 form is used to request an exemption or reduction in withholding of Maine income tax on the sale of Maine real property.
Governing Law This form is governed by 36 M.R.S. §§ 5250-A(3)(B) & (4), which empowers the State Tax Assessor to issue certificates of no tax due or reduced withholding amounts.
Submission Timeline Applicants must submit the REW-5 form at least 5 business days before the closing date to ensure processing.
Processing Time If mailed, processing may take an additional 2-3 weeks, so timely submission is crucial.
Contact Information For inquiries, applicants can contact Maine Revenue Services at 207-626-8473 or via email at [email protected].
Who Can File Any seller of Maine real property who is a nonresident at the time of closing can file this form, including individuals, firms, and corporations.
Withholding Rate The standard withholding rate is 2.5% of the total consideration, but sellers may request a reduced rate based on their maximum tax liability.
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