South Carolina tax deductions and write-offs (2026)

No. South Carolina fully exempts armed forces retired pay from state income tax (since tax year 2022). The exemption does not cover USPHS or NOAA Corps retirees; 2026 bills to add them did not advance. Other retirement income: Taxpayers under 65 may deduct up to $3,000 and those 65+ up to $10,000 per person of retirement income (pensions, 401(k), IRA). Those 65+ also get a $15,000 age deduction against any income, reduced by the retirement deduction claimed.

Partly. Taxpayers under 65 may deduct up to $3,000 and those 65+ up to $10,000 per person of retirement income (pensions, 401(k), IRA). Those 65+ also get a $15,000 age deduction against any income, reduced by the retirement deduction claimed. The 2026 tax law (H.4216) changed rates but kept these retirement deductions.

No. South Carolina excludes Social Security benefits from state gross income. Statutory basis: S.C. Code 12-6-1120(4).

Yes: South Carolina offers the South Carolina Earned Income Tax Credit, 125% of the federal EITC, capped at $200 starting in 2026 (nonrefundable). Nonrefundable. The $200 cap is new for tax year 2026 under H. 4216 (Act 110, signed March 30, 2026).

Only instead of income tax: itemizers in South Carolina pick sales tax (6% state rate, about 7.49% with local taxes) or state income tax, whichever is bigger. Instead of sales tax, vehicles pay a 5% infrastructure maintenance fee capped at $500; boats and aircraft pay a 5% 'max tax' also capped at $500, with no local tax.

No: South Carolina doesn't offer a renter's credit or rent rebate. South Carolina has no state tax credit, deduction, or rebate specifically for renters. South Carolina's homestead exemption for those 65+, blind, or disabled applies only to homes the claimant owns. Lower-income renters can still claim South Carolina's earned income credit: 125% of the federal EITC, capped at $200 starting in 2026.

Yes on your federal return if you itemize, within the $40,400 SALT cap. South Carolina adds its own break: 4% legal residence assessment ratio (vs 6% for other homes) for owner-occupied primary homes; apply with county assessor.

Partly: South Carolina's vehicle personal property tax is based on your vehicle's value, so it's deductible as personal property tax if you itemize. Vehicle property tax is due every year to the county, even though SCDMV registration is renewed every two years.

For 2026 South Carolina has two brackets: 1.99% on taxable income under $30,000 and 5.21% (minus $966) at $30,000 and above, down from a 6% top rate in 2025 (Act 110 of 2026 / H. 4216).

Yes on your South Carolina return: Unlimited (full contribution). Only contributions to the state's own plan count. Future Scholar only (incl. rollovers in); contributions through April 15 may be deducted for the prior year; principal recaptured if nonqualified.

No state child tax credit, but South Carolina has a child care credit: 7% of qualifying care expenses (as figured for the federal credit), up to $210 for one child or $420 for two or more. Nonrefundable. Full-year residents only; not available if married filing separately. A bill to make the care credit refundable starting 2027 (H. 5794) was only introduced. 2025 dependent exemption was $4,930 per dependent, plus an extra exemption for children under 6. Act 110 of 2026 restructured the income tax starting 2026, so the 2026 exemption treatment should be checked. South Carolina does have an earned income credit: 125% of the federal EITC, capped at $200 starting in 2026.

Yes, as a business expense: South Carolina charges $110 to form an LLC; ongoing: None (pass-through LLCs). No annual report for LLCs taxed as partnerships/disregarded (LLCs taxed as corporations file with SCDOR). Code 33-44-1204; online filing may be $125 with electronic surcharge (unverified).