§ 12-6-1140 — Deductions from individual taxable income.

South Carolina § 12-6-1140

• Jurisdiction: South Carolina
• Title 12: TAXATION
• Ch. 6: SOUTH CAROLINA INCOME TAX ACT

Text

There is allowed as a deduction in computing South Carolina taxable income of an individual the following: (1) a net gain deduction as provided in Section 12-6-1150; (2) an additional deduction for dependents under six years of age as provided in Section 12-6-1160; (3) a deduction as provided in Section 12-6-1170; (4) amounts included in South Carolina gross income received for disability retirement due to permanent and total disability by a person who could qualify for the homestead exemption under Section 12-37-250 by reason of being classified as totally and permanently disabled; (5) expenses incurred by taxpayers as provided in Internal Revenue Code Section 162(h) without regard to limitations in Section 162(h)(4); (6) a subsistence allowance of sixteen dollars a day for federal, state, and local law enforcement officers paid by a political subdivision of this State, the government of this State, or the federal government, for each regular work day in a taxable year and full-time firefighters and emergency medical service personnel may deduct as a subsistence allowance sixteen dollars a day for each regular work day in a taxable year; (7)(a) Two thousand dollars for each adopted special needs child who is: (i) dependent upon and receiving chief support from the taxpayer; (ii) under the age of twenty-one; and (iii) enrolled in an accredited school or college or is incapable of self-support because of mental or physical defects. (b) For purposes of this item, a special needs child is a person who is: (i) under eighteen at the time of adoption; (ii) the dependent of a public or private nonprofit adoption agency prior to the adoption; (iii) legally free for adoption; and (iv) unlikely to be adopted without assistance as determined by the South Carolina Department of Social Services because of conditions such as ethnic minority status, age, sibling group membership, medical condition, or physical, mental, or emotional handicaps. (c) The entire deduction is allowed for a taxable year even if the special needs child survives for only part of the taxable year. (8) RESERVED. (9) DELETED. (10)(a) A deduction calculated as provided in this item for a volunteer firefighter, rescue squad member, volunteer member of a Hazardous Materials (HAZMAT) Response Team, reserve police officer, Department of Natural Resources deputy enforcement officer, a member of the State Guard, or a volunteer state constable appointed pursuant to Section 23-1-60 for the purpose of assisting named law enforcement agencies and who has been designated by the State Law Enforcement Division as a state constable not otherwise eligible for this exemption. (b) An individual may receive only one deduction pursuant to this item. The Revenue and Fiscal Affairs Office annually shall estimate a maximum deduction that may be permitted under this section for a taxable year based on an individual income tax revenue loss of three million one hundred thousand dollars attributable to this deduction and shall certify that maximum deduction to the Department of Revenue and for the applicable taxable year, the maximum deduction amount must not exceed the lesser of the certified estimate or six thousand dollars. (c)(i) Only a volunteer earning a minimum number of points pursuant to Section 23-9-190 is eligible for this deduction unless otherwise provided in this item. (ii) In the case of a reserve police officer and in lieu of minimum points determining eligibility, this deduction is allowed only if the reserve police officer's coordinator-supervisor certifies in writing to the officer that the officer met all requirements of Chapter 28, Title 23 applicable to a reserve police officer for the entire taxable year. (iii) In the case of a Department of Natural Resources deputy enforcement officer and in lieu of minimum points determining eligibility, this deduction is allowed only if the deputy enforcement officer's supervisor certifies in writing to the officer that the officer met all requirements of Section 50-3-315 for the entire taxable year. (iv) In the case of a member of the State Guard and in lieu of minimum points determining eligibility, this deduction is allowed only if the State Guard member completes a minimum of sixteen hours of training or drill each month, equating to one hundred ninety-two hours a year, and the member's commanding officer certifies in writing to the member that the member met these requirements. (v) In the case of a volunteer state constable and in lieu of minimum points determining eligibility, this deduction is allowed only if the volunteer state constable completes a minimum logged service time of two hundred forty hours per year and has been designated by the State Law Enforcement Division as a state constable before the taxable year for which the deduction is first claimed and if the volunteer state constable is current with the required SLED approved annual training for constables for the most recently completed fiscal year as evidenced by a copy of the documentation provided to SLED of this annual training filed with the volunteer state constable's state income tax return. (d) These certifications from supervisors of taxpayers claiming the deduction must be on a form approved by the department. The department may require a copy of the certification be attached to the taxpayer's income tax return or otherwise be made available to the department. (11) contributions to the South Carolina Tuition Prepayment Program to the extent provided in Section 59-4-100 and to the South Carolina College Investment Program to the extent provided in Section 59-2-80. (12)(a) Contributions made to each investment trust account created pursuant to Article 3, Chapter 5, Title 11, or a qualified account under Section 529A located in another state, by a resident of this State or a nonresident required to file a State of South Carolina income tax return up to the limit of maximum contributions allowed to such accounts under Section 529A of the federal Internal Revenue Code of 1986, as amended, including funds transferred to an investment trust account from another qualified plan, as allowable under Section 529A of the federal Internal Revenue Code of 1986, as amended. (b) Any interest, dividends, gains, property, or income accruing on the payments made to an investment trust agreement pursuant to Article 3, Chapter 5, Title 11, or on any account in the Palmetto ABLE Savings Expense Fund or a qualified fund under Section 529A located in another state, must be excluded from the gross income of any such account owner, contributor, or beneficiary for purposes of South Carolina income taxes, to the extent the amounts remain on deposit in the Palmetto ABLE Savings Expense Fund or are withdrawn pursuant to a qualified withdrawal. (c) The earnings portion of any withdrawals from an account that are not qualified withdrawals must be included in the gross income of the resident recipient of the withdrawal for purposes of South Carolina income taxes in the year of the withdrawal. Withdrawals of the principal amount of contributions that are not qualified withdrawals must be recaptured into South Carolina income subject to tax to the extent the contributions were previously deducted from South Carolina taxable income. (13) a South Carolina dependent exemption equal to four thousand one hundred ten dollars for each eligible dependent of the taxpayer, including both qualifying children and qualifying relatives. To qualify for the deduction allowed by this item, each dependent must meet the eligibility requirements of Section 151 and 152, as applicable, mutatis mutandis, as those sections applied on January 1, 2017. Notwithstanding the deduction amount set forth in this item, each December fifteenth, the department shall cumulatively adjust the deduction amount using the Chained Consumer Price Index for All Consumers, as published by the Bureau of Labor and Statistics of the Department of Labor, pursuant to Internal Revenue Code Section (1)(f), except that the rounding amount is ten dollars. Text of (14) effective until January 1, 2030. (14)(a) amounts earned pursuant to Section 12-6-3800(E) for each clinical rotation a physician serves as the preceptor for a medical school-required clinical rotation, advanced practice nursing program-required clinical rotation, and physician assistant program-required clinical rotation; or (b) amounts earned pursuant to Section 12-6-3800(E) for each clinical rotation an advanced practice registered nurse or physician assistant serves as the preceptor for an advanced practice nursing or physician assistant-required clinical rotation.

Legislative History

HISTORY: 1995 Act No. 76, SECTION 1; 1997 Act No. 70, SECTION 5(A); 1997 Act No. 155, Part II, SECTION 2A; 1998 Act No. 419, Part II, SECTION 49A; 1999 Act No. 100, Part II, SECTION 23; 2001 Act No. 72, SECTION 5, eff July 20, 2001; 2002 Act No. 334, SECTION 19E, eff June 24, 2002, applicable for taxable years beginning after 2002; 2002 Act No. 363, SECTION 3A, eff August 2, 2002, applicable for taxable years beginning after 2002; 2004 Act No. 278, SECTION 1, eff July 16, 2004, applicable for taxable years beginning after 2003; 2005 Act No. 145, SECTION 11, eff June 7, 2005; 2006 Act No. 242, SECTION 1, eff March 20, 2006, applicable to taxable years beginning after 2005; 2007 Act No. 110, SECTION 11.A, eff June 21, 2007, applicable for taxable years beginning after 2005; 2007 Act No. 116, SECTION 17.A, eff June 28, 2007, applicable for taxable years beginning after 2005; 2008 Act No. 353, SECTION 2, Pt 12C.1, eff July 1, 2008; 2014 Act No. 134 (H.3089), SECTIONS 1.A, 1.B, eff March 13, 2014; 2016 Act No. 165 (H.3768), SECTION 2, eff April 29, 2016; 2018 Act No. 266 (H.5341), SECTION 5.A, eff October 3, 2018; 2019 Act No. 45 (S.314), SECTION 2, eff May 16, 2019; 2019 Act No. 88 (H.3986), SECTION 2, eff May 24, 2019; 2024 Act No. 217 (S.969), SECTIONS 1, 2, eff July 2, 2024. Repeal 2019 Act No. 45, SECTION 4, as amended by 2024 Act No. 217, SECTION 3.B, provides that (14) is repealed effective January 1, 2030. Code Commissioner's Note At the direction of the Code Commissioner, references in this section to the offices of the former State Budget and Control Board, Office of the Governor, or other agencies, were changed to reflect the transfer of them to the Department of Administration or other entities, pursuant to the directive of the South Carolina Restructuring Act, 2014 Act No. 121, SECTION 5(D)(1). Editor's Note 2014 Act No. 134, SECTION 2, provides as follows: "SECTION 2. This act takes effect upon approval by the Governor and applies for taxable years beginning after 2013." 2016 Act No. 165, SECTION 4, provides as follows: "SECTION 4. This act takes effect upon approval by the Governor and applies for tax years beginning after 2015." 2018 Act No. 266, SECTIONS 1, 5.B, 7, 8, and 9, provide as follows: "SECTION 1. This act may be referred to as the 'South Carolina Taxpayer Protection and Relief Act'." "[5.]B. Notwithstanding Section 12-6-1140(13), as added by this SECTION, the Department of Revenue shall not adjust the deduction set forth in Section 12-6-1140(13) for tax year 2018." "SECTION 7. The Department of Revenue shall take actions necessary to implement the provisions of this act and take the appropriate actions to educate taxpayers of the amendments contained within this act, especially those, if any, that impact filing requirements or determination of taxable income. "SECTION 8. By January 15, 2025, the Department of Revenue, in coordination with the Revenue and Fiscal Affairs Office, shall deliver a report to the General Assembly that specifies the many provisions of the Tax Cuts and Jobs Act of 2017 that expire after tax year 2025. "SECTION 9. Except where specified otherwise, this act takes effect upon approval by the Governor and first applies to tax years beginning after 2017." 2019 Act No. 45, preamble, and SECTIONS 3 and 4, as amended by 2024 Act No. 217, SECTION 3.B, provide as follows: "Whereas, the pipeline for primary care medical, advanced practice nursing, and physician assistant providers in South Carolina is vital to the State; and "Whereas, South Carolina is a largely rural state with a population of 4.8 million and is ranked forty-second nationally in overall health rankings; and "Whereas, South Carolina is ranked thirty-ninth nationally regarding patient access to health care services and forty-third for its total supply of primary care practicing physicians; and "Whereas, such health statistics, along with the shortage and maldistribution of health care professionals, are alarming, resulting in a grade of "F" in health care according to the South Carolina Department of Health and Environmental Control; and "Whereas, according to the South Carolina Department of Health and Environmental Control, all forty-six South Carolina counties are federally designated as being total or partial Medically Underserved Areas/Populations, forty-three counties as Health Professional Shortage Areas (HPSA), with twenty-nine categorized as low income HPSAs and fifteen fulfilling the criteria as geographic HPSAs, the designation used for the most underserved counties. Now, therefore, [Text of Act]." "SECTION 3. (A) Notwithstanding the credit amount for each rotation served and the annual credit limit set forth in Section 12-6-3800, as added by this act, the credit amounts and credit limits must be phased-in over five years in equal and cumulative installments. The first year of implementation is tax year 2020. "(B) In accordance with subsection (A), the amount of the deduction allowed for rotations served pursuant to Section 12-6-3800(E) and the item added to Section 12-6-1140 in this act, is subject to the phase-in and is equal to the amount the credit would have equaled in that particular tax year. "SECTION 4. This act takes effect upon approval by the Governor and shall apply to Tax Years 2020 through 2029. Section 12-6-3800 and Section 12-6-1140(14) are repealed January 1, 2030." 2024 Act No. 217, SECTION 5, provides as follows: "SECTION 5. This act takes effect upon approval by the Governor and applies to tax years beginning after 2023." Effect of Amendment 2014 Act No. 134, SECTION 1.A, 1.B, in subsection (10)(a), added text related to volunteer state constables; and added subsection (10)(c)(v), relating to volunteer state constables. 2016 Act No. 165, SECTION 2, added (12). 2018 Act No. 266, SECTION 5.A, added (13), providing a South Carolina dependent exemption and adjusting the amount of the exemption each year for inflation. 2019 Act No. 45, SECTION 2, added (14), allowing a deduction for certain clinical rotations for which no income tax credit is available. 2019 Act No. 88, SECTION 2, in (12)(b), substituted "Palmetto ABLE Savings Expense Fund" for "South Carolina ABLE Savings Expense Fund" in two places. 2024 Act No. 217, SECTION 1, in (6), substituted "sixteen dollars" for "eight dollars" in two places. 2024 Act No. 217, SECTION 2, in (10)(b), in the second sentence, substituted "six thousand dollars" for "three thousand dollars".