2020 LEGISLATIVE UPDATE – A list of significant changes in tax and regulatory laws and regulations enacted during the 2020 legislative session is available from the SCDOR Policy Division. Review Information Letters
20-19 and
20-31.
CONFORMITY – South Carolina conforms with the Internal Revenue Code as amended through December 31, 2019, except as otherwise provided. If Internal Revenue Code sections adopted by South Carolina which expired on December 31, 2019 are extended, but otherwise not amended, by congressional enactment during 2020, these sections are also extended for South Carolina Income Tax purposes in the same manner that they are extended for federal Income Tax purposes.
INCREASE IN SOUTH CAROLINA DEPENDENT EXEMPTION (line w of the SC1040) – The South Carolina dependent exemption amount for 2020 is $4,260 and is allowed for each eligible dependent, including both qualifying children and qualifying relatives.
INCREASE IN MOTOR FUEL INCOME TAX CREDIT – The refundable Income Tax credit increased from 3 cents per gallon to 7 cents per gallon in 2020. Full or part-year resident taxpayers may claim the refundable credit for the lesser of the increase in South Carolina Motor Fuel User Fee they paid during 2020 or the preventative maintenance costs they incurred in South Carolina during the tax year. The credit is limited to two private passenger motor vehicles or motorcycles. To claim the credit, attach a completed I-385 to your return.
INCREASE IN EARNED INCOME TAX CREDIT – Full‐year residents may claim the South Carolina Earned Income Tax Credit. For 2020, the non‐refundable credit is equal to 62.50% of the Federal Earned Income Tax Credit allowed the taxpayer.
INCREASE IN TWO WAGE EARNER CREDIT – The maximum credit available for the Two Wage Earner Credit (claimed by a married couple filing jointly when both taxpayers have earned income taxed to South Carolina) has increased. For 2020, the credit is 0.7% of the lesser of $40,000 or the South Carolina qualified earned income of the taxpayer with the lower qualified income for the taxable year.
SC DEPARTMENT OF ARCHIVES AND HISTORY CONTRIBUTION FOR CHECK-OFF – Contributions to the SC Department of Archives and History are used to purchase or preserve collections with significant historical value to the State. For more information visit the SC Department of Archives and History at
scdah.sc.gov.
PRECEPTOR CREDIT AND DEDUCTION – For tax years 2020 through 2025, a nonrefundable Individual Income Tax credit is available for eligible physicians, advanced practice registered nurses, or physician assistants who serve as preceptors for qualifying clinical rotations required by a medical school, physician assistant program, or advanced practice nursing program. Credit amounts are phased in over a five-year period. If a taxpayer serves additional rotations that exceed the credit limit for the tax year, they may be eligible for a deduction on line v of the SC1040. Use the
TC-62 to determine if you are eligible for the credit and to calculate the credit and the deduction. For more information, refer to SC
Revenue Ruling 20-2.
SOUTH CAROLINA HOUSING TAX CREDIT – The South Carolina Housing Tax Credit is a nonrefundable tax credit available to eligible owners of residential low-income rental buildings who are certified by the South Carolina Housing and Finance Development Authority. Use the
TC-63 to claim the credit. For more information, refer to
Revenue Ruling 21-1.