On April 9, 2026, Maine Governor Janet Mills approved L.D. 2212, which, retroactive to January 1, 2026, imposes a 2% surcharge on individual income that exceeds $1 million ($1.5 million for joint filers and heads of households).

Governor Mills explained that the added revenue generated from this surcharge "makes Free Community College permanent, it delivers more property tax relief and funding for childcare and importantly, preserves critical funding for schools and health care for the coming years." (Office of Governor Mills press release, April 9, 2026.)

Once available, the updated income tax withholding formula and tables will be published here.

Maine joins two other states that impose an income tax surcharge on millionaires: Washington, where the governor signed a millionaire income tax into law on March 30,2026, and Massachusetts, which has imposed an income surtax on millionaires since tax year 2023. Hawaii legislators are currently considering H.B. 1807, which would impose a 3% surtax on millionaires retroactive to January 1, 2026.

Ernst & Young LLP insights

Employers should consider notifying employees living and/or working in Maine of the potential increase in their personal income tax liability for 2026 and suggest they review their Form W-4ME, Employee's Maine Withholding Certificate, to determine if updates are needed.