Maine's Current Use Property Tax Programs

If you live in Maine you know it is a state with massive amounts of undeveloped, forested, or otherwise wild space. Often this type of land has been held in a family for several generations. The  property tax burden of sitting on open land can continue to grow as municipalities require more revenue. If the burden of continuing to hold undeveloped land gets excessive, landowners are encouraged to either develop the land or sell it to someone who will.  Maine has a tax program that allows landowners to designate undeveloped land and receive a reduction in property taxes.  While this program is not for everyone, it definitely can provide tax relief to people who wish to keep their land undeveloped.  

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Municipal Land Use Permitting

If you are thinking of making a change to how you are using a piece of real estate, you need to ask yourself, “do I need a permit for this change?”  Whether it’s building a home or accessory structure, converting a home to business use, or dividing a larger lot into multiple lots, you will likely need one or more permits from some governmental entity. The tricky question that you need to answer, which permits do you need?

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Variances: Maine's Undue Hardship Test Explained

So your family has been holding on to a small, vacant piece of real estate for decades. You never really got around to building anything on it and have decided now is the time to develop.  Surprise, your lot is smaller than your town’s minimum lot size for single family homes. Further, even a small house would be in violation of the town's setback requirements.  Are you completely out of luck and stuck with a useless piece of property? Not necessarily.  Some lots will be eligible for variances, which will relax zoning requirements in some circumstances.  

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Maine’s Regulation of Tiny Houses

Land use is frequently a challenging and complicated area when new housing developments arise.  New land uses often leave municipal and state regulators unsure of how to regulate. For example, some cities were initially unsure how to handle the rise of short term rentals through Air BNB, leading to new regulations. Alternatively, the growing number of people looking to operate food trucks has also led to regulatory adaptation. The tiny house movement is another such development that currently needs attention. 

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An Introduction to Trusts

Some of my prior posts have references to trusts. However, I have yet to give a basic explanation of how they work. Hopefully, this post will give those without experience with trusts some basic knowledge. One key feature of a trust is the division of the benefits and burdens property ownership. For example, trusts are often used when children inherit large sums of money and someone thinks it's unwise to allow a 13 year old to immediately use the money as they deem fit.

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Use Caution When Clearing Vegetation in a Shoreland Zone

Now that spring is here, it is time to start preparing your family camp for summer. This may lead you to get the urge to clear out some vegetation around your property.  Maybe you have some trees that you think may be dying or safety hazards and you believe it’s about time to bring them down. This is not something you should do without being sure whether you need a permit. In many cases, even dead and dying trees need to be replanted and a Code Enforcement Officer should be consulted. Further, unpermitted cutting of vegetation on waterfront property can lead to civil penalties and expensive replanting projects. 

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Business Agreements: Yes, they really should be in writing

When engaging in business transactions with friends, it can be very tempting to try to save the time and money involved with formalizing the arrangement. Everyone knows that lawyers are expensive. You know and trust the person you're dealing with, so why not just trust them to keep their word now? Maybe you’re worried that making a friend sign a written agreement will make them think you don't trust them. Who really wants to talk about how a deal could go wrong when you and your partner are so pumped about your great business idea? I would suggest having this conversation early is much better than skipping it and having the deal go south after you've both invested time and money. Despite your excitement about your new venture, things can, and often do, go wrong and you need a plan in place for that possibility. 

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Basic Estate Planning for Young Families

Setting up, or even just updating, your estate plan will never be first on your to-do list when coming home with a new child.  There are far too many things to do and there is never enough time to do them. Whenever you get a moment of downtime, you're likely going to want to spend it catching up on sleep and not thinking about the doom and gloom scenarios that make estate planning necessary for your family. The good news is estate planning does not have to be a difficult process and with a small investment of time and money you can have an estate plan that gives you peace of mind.

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Maine’s Freedom of Access Act: An essential tool for governmental accountability

State and municipal governments are constantly making decisions that impact the lives of citizens.  Commonly, the reasoning behind those decisions can be unclear.  Further, problems with the process involved in making those decisions could weaken their validity.  It is difficult to point out decision-making flaws when citizens are kept in the dark.  Governments are commonly held accountable through open government laws that allow citizens to participate and remain informed.  Here in Maine, we have the Freedom of Access Act (FOAA) to provide the public access to government information.

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Important Considerations when Granting or Acquiring Easements

When buying or selling real estate, the transaction often requires granting an easement to provide access, either physically or to utilities like water or electricity.  Briefly, an easement is the right of one property owner to use another's property for a specific purpose.  Commonly, easements are in the form of a right of way that allows the owners of a neighboring lot to pass over another’s land to access their own.  An easement could also allow placement of a well or access to a public water supply. Alternatively, a negative easement could provide that the owner of a lot will actually refrain from using his or her property in certain ways.  For example, a view easement could limit the height of any buildings to protect the easement holder's views.   

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Engage Early When Opposing Real Estate Developments

You have just moved into your dream house in what you believe to be the perfect community.  Everything is great for a while.  A few years later you receive a notice about a development being proposed in your community.  Maybe it’s just a project that you think will greatly impact your life in the community.  Maybe it’s a proposal to build a strip mall next to your home.  Now you have a choice to make.  Do you just sit back and hope the town planning board does, what you think is, the right thing?  Do you chain yourself to a tree? Do you try to stop or, at least, alter the project by getting involved in the approval process?  I would suggest that getting involved is your best bet. 

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Municipal Land Use Violations: Landowners Can Unknowingly be Exposed to Enforcement Liability

"It's my property, I can do what I want" is a common statement made by some landowners. With the increase in land use regulation and zoning, it has increasingly become a falsehood.  Land use regulations greatly impact how real property is used and can often prohibit seemingly harmless actions.  For example, some Portland landowners are facing enforcement actions for renting out their property on  

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Babies: How they make updating a law blog a low priority

It's been a while since something substantive has been posted here.  I have not given up on blogging like many others have before me.  On June 15th my wife, Becca, gave birth to our first son Arthur. Everyone is healthy and doing great.  Let's just say this new arrival has made writing about the business forms, tax code, or anything for that matter seem a great deal less interesting.  

I was going to use this as an opportunity to discuss why you should think about estate planning once you have children no matter how old you are. Alas, I'll have to add that to the list of things to talk about later.  

A Brief Introduction to Federal Taxation of Businesses

It would be impossible to fully explain the intricacies of the various federal business tax regimes in a blog post. I can assure you, nobody wants to read that. However, I will attempt to briefly introduce some keep pieces of the following business tax regimes:

  • Sole Proprietor (Schedule C of an individual return)
  • C Corporation (Subchapter C - Form 1120)
  • S Corporation (Subchapter S - Form 1120s)
  • Partnership (Subchapter K - Form 1065)
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New Business: Some Considerations for Entity Selection

When starting a new business several considerations need to be taken into account when deciding what business entity, if any, you should form. Every business has it's own unique circumstances, however, there are two major benefits that can come with forming a business entity. First, entities formed pursuant to a state statute give owners the benefit of liability protection.  Second, there is also a potential for tax savings coming in the form of a reduction of self employment taxes. 

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Family camps in Maine: Why you should plan for the future

The family camp is an important piece of many Maine families.  However, the family camp experience is not limited to just campfires, swimming and relaxing.  There are a wide variety of legal issues that can come with owning a piece of real estate with others.  Two major issues will almost be guaranteed to come up at one time or another.  First, who is going to be responsible for the burdens of ownership?  Second, how are the benefits of owning a family camp going to be divided?  Often these issues need to be considered while hoping to follow the wishes of the past generation that hoped to keep the property in the family for years to come.

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