More than 1 million homeowners live in South Carolina, and many of them could lessen their tax liability this year by claiming the state tax credits and exemptions listed below.
If you're remodeling, making your home more energy efficient, or paying casualty insurance, the South Carolina Department of Revenue (SCDOR) wants you to know how to qualify for available tax credits and exemptions.
All South Carolina tax credits related to home ownership and listed below are nonrefundable, meaning they cannot reduce your tax liability below zero. It's important to review the details of each credit, since specific circumstances apply for eligibility.
Check out these credits to see if you may qualify:
Certified Historic Residential Structure Credit: If you rehabilitate a certified historic residential structure in South Carolina, you may be eligible for a credit limited to 25% of the restoration expenses, which must exceed $15,000 within 36 months. The credit must be taken over a three-year period and has a five-year carryforward.
Residential Retrofit Credit: If you recently made your legal residence more resistant to hurricanes, floods, or catastrophic wind damage, you may be able to claim the lesser of 25% of the costs or $1,000. You may also claim up to $1,500 in Sales and Use Tax paid on purchases of qualifying tangible personal property.
Excess Insurance Premium Credit: If you pay residential property and casualty insurance premiums in excess of 5% of your adjusted gross income, you may qualify for this credit. The credit is limited to $1,250 and has a five-year carryforward.
Energy Efficient Manufactured Home Credit: If you buy a manufactured home that meets or exceeds the energy-saving efficiency requirements or Energy Star program requirements of the U.S. Environmental Protection Agency or U.S. Department of Energy, you may claim this credit, limited to $750. This credit requires a certification letter from the South Carolina Energy Office.
Solar Energy, Small Hydropower System, or Geothermal Machinery and Equipment Credit: You may claim this credit if you own and install a solar energy system, small hydropower system, or geothermal machinery and equipment. The system must be used for heating water, air cooling, energy generation, space heating, heat reclamation, or energy demand response. This credit is limited to 25% of the cost of purchasing and installing the system. The credit can't exceed $3,500 for each facility or 50% of your tax liability. It has a carryforward of 10 years.
Check out these exemptions to see if you may qualify:
The School Operating Cost Exemption: All school operating taxes are exempt for owner-occupied homes in South Carolina. No application is necessary but you must have applied for a 4% ratio on the assessed value of your home. Second homes, business and 6% ratio property do not qualify.
The Homestead Exemption: If you are at least 65, legally blind, or physically disabled, you may apply to your county auditor for a Homestead Exemption, which exempts all the remaining taxes for the first $50,000 of value for all purposes except for school operating taxes.
How to claim tax credits and exemptions
Details about which form to file to claim the credits can be found at dor.sc.gov/taxcredits. If you use a tax preparer to file your Individual Income Tax return, be sure to ask them about the credit you want to claim. Visit
dor.sc.gov/lgs/homestead-exemption for more information about the School Operating Cost and Homestead exemptions.
2022 Individual Income Tax returns are due April 18, 2023. The SCDOR recommends you file your return online and choose direct deposit for your refund – they're our fastest, safest, and easiest options. For more tips and information about filing Individual Income Tax Returns, visit dor.sc.gov/iit.
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