Bottom Line
Middle-Class Families: Tax-Friendly (Go to the Kiplinger Tax Map for Middle-Class Families)
Retirees: Most Tax-Friendly (Go to the Kiplinger Tax Map for Retirees)
The Palmetto State boasts one of the lowest median property tax rates in the country. That's the driving force behind South Carolina's low tax burden.
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Many working-class residents will likely find themselves in the state's highest income bracket (which is going down), but retirees fair much better thanks to a collection of income tax breaks aimed at seniors. Residents who file a 2021 South Carolina income tax return by February 15, 2023, may also get a tax rebate (all rebate checks are expected to be issued by March 31, 2023).
Unfortunately, sales taxes are on the high end in South Carolina, with an average combined state and local rate of 7.44%.
South Carolina Income Taxes
South Carolina Income Tax Range
Low: 3% (on taxable income from $3,200 to $16,039)
High: 6.5% (on taxable income over $16,039)
Beginning with the 2023 tax year, and each year thereafter until it equals 6%, the top rate will decrease by 0.1% if general fund revenues are projected to increase by at least 5% in the fiscal year that begins during the tax year.
South Carolina Taxation of Social Security Benefits
Social Security benefits are not taxed by the state.
South Carolina Tax Breaks for Other Retirement Income
Taxpayers age 65 or older can exclude up to $10,000 of retirement income (up to $3,000 for taxpayers under 65). Joint filers can each claim the exemption.
Taxpayers age 65 or older can also deduct $15,000 ($30,000 for joint filers) from all taxable income. However, the deduction must be reduced by the amount of retirement income otherwise excluded.
Military retirement income and Railroad Retirement benefits are fully exempt.
South Carolina Sales Tax
6% state levy (5% for purchases for personal use by people at least 85 years old). Localities can add as much as 3%, and the average combined rate is 7.44%, according to the Tax Foundation.
- Groceries: Exempt
- Clothing: Taxable
- Motor Vehicles: Exempt from ordinary sales tax, but taxable under special 5% (up to $500) infrastructure maintenance fee
- Prescription Drugs: Exempt
South Carolina Real Property Taxes
In South Carolina, the median property tax rate is $566 per $100,000 of assessed home value.
South Carolina Property Tax Breaks for Retirees
For homeowners 65 and older, the state's homestead exemption allows the first $50,000 of a property's fair market value to be exempt from local property taxes. To qualify, you must have been at least 65 years old and a legal resident of South Carolina for one year, as of December 31 of the year preceding the tax year the exemption is claimed.
South Carolina Motor Fuel Taxes
Gasoline: 26.75¢ per gallon (28.75¢ per gallon effective July 1, 2022).
Diesel: 26.75¢ per gallon (28.75¢ per gallon effective July 1, 2022).
South Carolina Sin Taxes
Cigarettes: $0.57 per pack
Other tobacco products: 5% of the manufacturer’s price
Beer: $0.77 per gallon
Wine: $0.90 per gallon
Liquor: $2.72 per gallon with 9% surtax and per-case fees also due
South Carolina Estate and Inheritance Taxes
No estate or inheritance tax.
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