South Carolina income tax rates are currently as high as 7% which makes it the state with the highest income taxes in the southeast.
What is the South Carolina income tax rate?
Like the IRS, South Carolina goes by tax brackets. Unlike the IRS, South Carolina doesn’t have separate tax brackets for single and married filers.
- 0%: Income up to about $3,000 (there is a small annual inflation adjustment to all income ranges)
- 3%: Income between $3,000 to $6,000
- 4%: Income between $6,000 to $9,000
- 5%: Income between $9,000 to $12,000
- 6%: Income between $12,000 to $15,000
- 7%: Income over $15,000
The income levels are based on your taxable income and are after subtracting the standard deduction and/or other deductions.
South Carolina Two Wage Earner Credit
South Carolina provides a tax credit to spouses with dual incomes to make up for not having joint filing tax brackets.
The credit is worth up to 0.7% of the lower-earning spouse’s earned income. The credit only applies to income up to $43,333 as of 2022. If your income is over that amount, you don’t get an additional credit but do get the credit on your first $43,333.
Does South Carolina tax retirement income?
South Carolina does not tax Social Security benefits, military retirement income, or Railroad Retirement benefits.
South Carolina has tax exemptions for other types of retirement income such as pension income and IRA distributions.
- Taxpayers under age 65 can exclude up to $3,000 in retirement income from their taxable income.
- Taxpayers age 65 or older have two exclusions available. They can deduct up to $10,000 in retirement income or $15,000 in total income. The maximum deduction is $15,000 (they don’t add together to get $25,000).
All exclusions apply per person. For married filers, both spouses can claim their own deduction if eligible.
Tip: If you moved to South Carolina to avoid high California taxes, don’t forget to break your California residency.
Who has to pay taxes in South Carolina?
South Carolina residents generally must pay South Carolina income taxes on all of their income but may get a credit for taxes paid to another state.
Non-residents generally must pay South Carolina income taxes on income from a job, business, rental property, investment, or other source based in South Carolina.
When are South Carolina income taxes due?
South Carolina personal tax returns are due on April 15th.
If you need an extension to file, you must request one from South Carolina. South Carolina doesn’t use your IRS extension.
You can mail Form SC4868 or request an extension online. Your extension must include a payment for at least 90% of your tax due.