Although there are many subtractions to federal income for South Carolina purposes, many are already calculated by our program. Please enter any of the following subtractions that are applicable:
STATE TAX REFUND
If your state tax refund was included on line 10 of your federal Form 1040, that amount should be entered on this line.
TOTAL AND PERMANENT DISABILITY RETIREMENT INCOME TAXED ON YOUR FEDERAL RETURN
If disability retirement income was taxed on your federal income tax return and you are totally and permanently disabled, you may be able to deduct this income from your South Carolina taxable income. You must be totally and permanently disabled, unable to be gainfully employed in any capacity, receiving income from a disability retirement plan, and eligible for the homestead exemption under Section 12-37-250 to qualify. You do not qualify if you are receiving disability income from one job while able to perform another job. You must attach a copy of the physician's statement establishing that you are permanently and totally disabled.
NOTE: The deduction is limited to payments received from retirement plans. Payments from disability plans which are not retirement plans are not eligible for the deduction. Third party sick pay reported on a W-2 does not qualify for the total and permanent disability retirement deduction. A surviving spouse may take a disability retirement deduction for amounts received in the year the disabled spouse died. For subsequent years, a surviving spouse is only eligible for the retirement deduction on line 48 and not the disability deduction.
OUT-OF-STATE RENTAL/BUSINESS OR REAL ESTATE INCOME NOT TAXABLE TO SOUTH CAROLINA
If you have income from out-of-state rental property; a business located outside South Carolina; or gain from real property located out of state, as reported on your federal return, enter this amount on this line. However, personal service income (W-2 or business wages) is taxable to South Carolina no matter where it is earned.
NET CAPITAL GAIN DEDUCTION
Net capital gains which have been held for a period of more than one year and have been included in the SC taxable income are reduced by 44% for SC income tax purposes.
The term "net capital gain" means the excess of the net long-term capital gain for the taxable year over the net short-term capital loss for such year. Income received from installment sales as well as capital gain distribution qualifies for this deduction provided the more than one year holding period has been met. (SC Capital Gains holding period is the same as the federal.)
Multiply the net gain which meets the above guidelines by 44% (.44) and enter the results on this line.
Volunteer firefighters, rescue squad workers, volunteer hazardous material HAZMAT team members, reserve police officers, Department of Natural Resource (DNR) deputy enforcement officers, and members of the State Guard are allowed to deduct $3,000. Volunteer firefighters, rescue squad workers and HAZMAT members qualify only if their employer provides them with a form stating that they have earned the minimum number of points established by the State Fire Marshal during the year. Reserve police officers, DNR deputy enforcement officer, and the State Guard members qualify only if the appropriate authority provides them with an I-332 certification form certifying their eligibility for this deduction. An individual is limited to one deduction of $3,000. If a taxpayer and spouse both qualify, enter $6,000.
CONTRIBUTIONS TO THE SC COLLEGE INVESTMENT PROGRAM ("FUTURE SCHOLAR") OR TO THE SC TUITION PREPAYMENT PROGRAM
You may deduct 100% of any contributions to the SC College Investment Program (Future Scholar) made during the fiscal year. You may deduct 100% of any contribution to the SC Tuition Prepayment.
ACTIVE TRADE OR BUSINES INCOME DEDUCTION
INTEREST FROM U.S OBLIGATIONS
If you included your interst income from U.S obligations (such as U.S savings bonds, treasury notes and bils, etc.) as income on your federal income tax return, enter the amount on this line. Deduct he interest income from South Carolina and/or federal obligations.
CERTAIN NONTAXABLE NATIONAL GUARD OR RESERVE PAY
SOCIAL SECURITY AND/OR RAILROAD RETIREMENT AMOUNT IF TAXED BY FEDERAL
If you are taxed on any Social Security under Title 2 of the Social Security Act or ailroad retirement income on your federal return, enter the amount that was taxed on your federal return
An individual who is under age 65 may claim a retirement deduction up to $3,000 of qualifed retirement income from his or her own plan. An individual who is age 65 or older during the tax year may claim a retirement deduction up to $10,000 of qualifed retirement income from his or her own plan.