South Carolina Withholding Tax tables updated for the FIRST time in 25 YEARS on January 1, 2017. Make sure your business is using the new tables!
The federal government updates figures on its tables annually. Beginning in 2017, South Carolina Withholding tables will be updated every year.
2017 SC Withholding Tables
2017 SC Withholding Tax Formula
Outdated Withholding Tables are a Problem for South Carolina
Outdated Withholding tax tables lead to over-withholding, which amounted to $1.5 billion in 2015.
Over-withholding is all the money taken out of taxpayers' wages that was not needed to pay their state income taxes. In other words, the government took more money than it should have and must return it to taxpayers through Individual Income Tax refunds. That $1.5 billion in over-withholding has created a number of issues for the State:
Unreliable General Fund Budgeting: A big portion of the money collected throughout the year ($1.5 billion) has to be refunded back to taxpayers.
Unnecessary Administrative Costs: Generating, regulating, and protecting refunds is expensive.
Undeniable Risk: Big tax refunds make South Carolina a target for income tax refund fraud and theft.
By addressing over-withholding, these problems begin to correct themselves over time, helping to create a healthier State.
How Does This Change Impact Me?
August 2016: New Withholding tables were made available to view/download.
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January 1, 2017: New Withholding tables should now be implemented by employers, accountants, payroll providers, etc.
What is South Carolina Withholding Tax?