South Carolina Tax
South Carolina State Tax
South Carolina Income Tax
The State of South Carolina has a six-tier marginal income tax system. These income tax brackets differ for taxpayers filing under various conditions. The South Carolina Department of Revenue adjusts the state’s tax brackets for inflation every year. As of this year, the highest bracket for individual and married taxpayers filing separately consists of incomes over $13,800 levied with 7% income tax rate. The first $2760 of income is exempted from income tax. South Carolina income tax brackets are expanded for coupled filing jointly.
All corporations that operate or generate income in South Carolina must pay state income tax. The state collects a flat rate of 5% corporate income tax on corporate incomes of all levels. The maximum corporate income tax in South Carolina is the 3rd lowest among states that levy corporate income tax.
South Carolina Sales Tax
The state collects sales tax from sales, rent, or lease of tangible objects and certain services. Taxable items include prepared meals, accommodations, and vehicle rentals. Counties and municipalities in South Carolina are allowed to impose up to 3% local sales tax on top of the 6% sales tax collected by the state. Groceries, raw food, and prescription drugs are exempted from sales tax, but liquor and prepared food such as restaurant meals are subject to higher tax rates of up to 16.5% in certain jurisdictions. Taxes on large purchases such as most motor vehicles are capped at $300.
Business owners collect sales tax for the state. They then turn these taxes over to the state monthly (or quarterly if sales tax collection is less than $100 a month).