South Carolina has an average tax policy. The have income and business taxes, but not too high. They don’t tax social security but are one of the few states that has a capital assets tax. Overall is an “okay” state regarding taxes, but not as good as their neighbor North Carolina.
State Taxes at a Glance – South Carolina
| Type of Tax | 2022 |
|---|
| Individual Rates | 0.00% to 7.00% |
| Corporate / Business Tax Rates | 3% or 5% flat tax |
| Gross Receipts Tax | None |
| Sales Tax | 7.44% (average) |
| Property Taxes | 0.56% as a percentage of primary home |
| Estate or Inheritance Tax | None |
State Income Taxes in South Carolina
The state of South Carolina does have an individual income tax. Like most states with income tax, it is calculated on a marginal scale whose range is from 0.00% to 7.00%. The highest bracket begins with income above $16K.
State Business Taxes in South Carolina
The state of South Carolina has different tax rates based on the type of business entity you own –
- C-Corporations – have a flat tax rate of 5.00% on all income.
- Flow-Thru (S-Corp, LLC, etc.,): Active Trade or Business – You may make a special election and pay a tax rate of 3.00%.
- All other flow-thru income – taxed at individual tax rates.
Similar to Connecticut, South Carolina created an election as a work-around for the SALT cap.
Corporate Capital Stock Tax
In addition to the corporate tax, South Carolina has a Capital Stock Tax. This capital stock tax is assessed on both types of Corporations (C Corp and S Corp).
It is assessed at $1.00 per $1,000 of capital (0.10% tax rate) plus an additional $15.
Sales and Property Taxes in South Carolina
Sales Taxes – Like most states, South Carolina has both a state and local sales tax. Its state sales tax is 6.00% and its local sales tax has an average rate of 1.44% (which puts the state average 7.44%).
Property Taxes in South Carolina – the average property tax rate for residential property in the state of South Carolina is 0.56%, which is well below the national average. South Carolina is within the top ten least expensive states regarding property tax as a percentage of value.
South Carolina DMV fees
South Carolina’s DMV fees are based on the value of the vehicle (Ad Valorem Tax) and are therefore deductible. The tax is paid to the county your automobile is registered in. For your reference, here’s a link to the South Carolina DMV Website.
South Carolina Domicile
South Carolina’s domicile laws are vague. They don’t define domicile for normal residency, however for state tuition purposes it states that a person must live in South Carolina for twelve (12) consecutive months to be eligible for in-state tuition.
South Carolina Tax on Social Security Benefits
Even though there is a state income tax in South Carolina, they do not assess state income tax on social security benefits.
Payroll Taxes in South Carolina
Unemployment taxes usually consist of three factors. They are: the wage base, the range of UI rates, number of schedules. Below is an outline of the three:
- Wage Base – South Carolina has a wage base of $14,000
- UI Rates – range from 0.06 to 5.46%
- Schedules – South Carolina has a single rate schedules regarding UI
South Carolina Business Entities – LLCs
South Carolina is one of the least expensive in regards to opening an LLC. Here are some important facts:
- South Carolina does not have an annual LLC fee, yay!
- When you register with the state, you pay a one time fee of $110
- Secretary of State of South Carolina website – click here
South Carolina Tax Contact Phone Numbers
Important phone numbers for the South Carolina Department of Taxation:
- Website: dor.sc.gov
- Phone# for Individuals – (844) 898-8542
- Phone# for Businesses – Same