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South Carolina State Income Tax Information

South Carolina employs a progressive income tax system with three tax brackets for the 2025 tax year:

• 0.00% on taxable income up to $3,460
• 3.00% on taxable income between $3,461 and $17,300
• 6.20% on taxable income over $17,300

These rates apply uniformly across all filing statuses. The tax brackets are adjusted annually for inflation.

Standard Deduction

For the 2025 tax year, South Carolina offers the following standard deductions:

• Single: $15,000
• Married Filing Jointly: $30,000
• Head of Household: $22,500

Note: Taxpayers aged 65 or older or who are blind may be eligible for additional standard deduction amounts.

Retirement Income

South Carolina provides tax benefits for retirees:

• Social Security Benefits: Fully exempt from state income tax for qualifying retirees.
• Pension Income: Exempt from state income tax for individuals aged 65 or older, subject to income limitations.
• 401(k) and IRA Distributions: Exempt from state income tax for individuals aged 65 or older, subject to income limitations.

Note: Federal taxes still apply to these income sources.

FICA Taxes

Pre-Tax Deductions

South Carolina allows the following pre-tax deductions:

• Contributions to Health Savings Accounts (HSAs)
• Contributions to Medical Savings Accounts (MSAs)
• Contributions to 529 College Savings Plans
• Contributions to ABLE (Achieving a Better Life Experience) Savings Accounts

These deductions are subject to federal limits and rules. Only contributions that are also deductible for federal income tax purposes are allowed for South Carolina state tax purposes.

South Carolina-Specific Tax Credits

South Carolina offers several tax credits to eligible residents:

• Property Tax Relief Credit: Provides rebates to eligible residents aged 65 and older, widows and widowers aged 50 and older, and individuals with disabilities aged 18 and older. The income limit for this program is $46,520 for the 2025 tax year, adjusted for cost-of-living increases. Rebates range from $380 to $1,000, depending on income and filing status.
• Child and Dependent Care Enhancement Credit: Offers a credit equal to 100% of the federal Child and Dependent Care Tax Credit, up to a maximum of $2,100 for families with two or more children. This enhancement increases the state’s match from 30% to 100% of the federal credit.
• Tax Forgiveness (Special Poverty) Credit: Provides a credit to low-income individuals, including retirees, to reduce or eliminate their state income tax liability.

Interesting Facts About South Carolina Taxes

• South Carolina has a graduated state individual income tax, with rates ranging from 0% to 6.2%.
• The state offers various tax credits to promote education, renewable energy, and support low-income families.
• Recent tax reforms have aimed to simplify the tax code and reduce the overall tax burden on residents.

Frequently Asked Questions (FAQs)

Does South Carolina tax Social Security benefits?

South Carolina exempts Social Security benefits from state income tax for many retirees. Retirees who have reached full retirement age and meet income requirements aren’t subject to state tax on Social Security benefits.

What is the standard deduction in South Carolina for 2025?

The standard deduction is $15,000 for single filers, $30,000 for married couples filing jointly, and $22,500 for head of household filers.

Are there any tax credits for education-related expenses?

Yes, South Carolina offers tax credits for contributions to scholarship-granting organizations and educational improvement grants, subject to certain limitations.

How does South Carolina’s income tax system work?

South Carolina uses a progressive income tax system with three brackets, taxing higher income levels at higher rates, ranging from 0% to 6.2%.