Welcome to South Carolina.

If you buy a home in South Carolina and it is your primary residence, there are ways to save on your property taxes:

SPECIAL ASSESSMENT BASED ON LEGAL RESIDENCE:

This entitles the homeowner to a reduced property tax of 4% from the normal 6% rate. To apply this to reduction, you must go the County Assessor’s Office and fill out the application. It can be done anytime during the year. 

HOMESTEAD TAX EXEMPTION:

This exempts the first $50,000 of value of your primary residence from property tax. You must be age 65 or older (if married only one has to be 65), have lived in your home for one calendar year, and be a South Carolina resident. You need to apply at your county Auditor’s Office.

South Carolina levies personal property tax on vehicles and boats annually. However, unlike 

many northern states, when you buy a vehicle in South Carolina you pay a maximum of $500 in sales tax. It takes approximately 3-4 years of paying personal property tax to equal what the sales tax would have been if it were assessed on the whole purchase price. As a newcomer to South Carolina, if you have 45 days to pay your vehicle property tax and get a South Carolina license plate and driver’s license.

South Carolina state sales tax is 6% plus the counties can add more. For example, York County adds 1% for a total of 7%.

South Carolina has a progressive tax rate structure that tops out at 7% very quickly. South Carolina’s income tax is based on Federal Taxable Income, however allows the following subtractions:

SOCIAL SECURITY INCOME:

South Carolina excludes Social Security income from being taxed.

SENIOR DEDUCTIONS:

Seniors age 65 and older get a $15,000 exclusion from taxable income ($30,000 for married seniors). Seniors under 65 get a $3,000 exemption from qualified retirement income only.

CAPITAL GAINS:

South Carolina allows a 44% exemption on net long term capital gains.

OUT-OF-STATE INCOME:

South Carolina excludes out-of-state rental or business income from being taxed.

ACTIVE BUSINESS INCOME:

Eligible South Carolina business income may be excluded from being taxed at 7%, and instead may be eligible for a max 3% tax rate.

529 PLAN CONTRIBUTIONS:

South Carolina allows an unlimited income tax deduction for contributions to its 529 Future Scholar College savings program. If you have a 529 plan set up in another state, it is possible to roll it over into the South Carolina 529 Plan and get a tax deduction.

TAX FILING REQUIREMENT IN THE YEAR OF MOVING:

If you move to South Carolina in the middle of the year, you must file a South Carolina tax return. Instead of a partial year resident return, you must elect to file either as a full year non-resident or a full year resident. If you want the lower special property tax assessment on your primary residence for this partial year, you must file as a full year resident. You may want to wait and start your South Carolina residency in the next year if you had high earnings in a low income tax state. If you pay tax in another state and the same income is taxed in South Carolina, then you will get a tax credit for the non-South Carolina tax paid.

SOUTH CAROLINA INCOME TAX CREDITS:

South Carolina is one of the few states that allow the scale and purchase of 

certain tax credits between taxpayers. There are established exchanges that 

enable taxpayers to buy these credits at a discount. We are able to assist 

our clients in purchasing credits.