TAX CREDITs

 

Jobs Tax Credit: A business that creates at least 10 jobs at a corporate headquarters, manufacturing, distribution, processing, warehousing, or research and development facility is eligible for an as-of-right non-refundable tax credit of $1,500 to $8,000 per job.  An additional $1,000 per job bonus is available to companies that locate in a multi-county industrial park.  The actual amount of the tax credit will depend on the development tier of the county where the project is located.  The credits cannot be used to offset more than 50% of tax liability in a given year. Unused credits may be carried forward for up to 15 years.

Corporate Headquarters Tax Credit: Companies that expand or locate a corporate headquarters facility in South Carolina may receive a tax credit equal to 20% of the value of the portion of the facility dedicated to the headquarters operation or 20% of the first 5 years of direct lease costs.  To qualify, a business must create at least 40 jobs with 20 of those jobs classified as headquarters staff positions. The credit can be applied against either corporate income tax or the license fee. Tax credits are non-refundable and non-transferable and may be taken for up to 10 years.

Investment Tax Credit: Manufacturers that relocate to or expand in South Carolina are eligible for a one-time corporate income tax credit of up to 2.5% of the cost of new production equipment.   The credit can be used to offset up to 100% of corporate tax liability.  All unused credits can be carried forward for up to 10 years.    

Research and Development Tax Credit: A credit equal to 5% of a company’s qualified research expenses in the state may be claimed by eligible businesses. The credit cannot be used to offset more than 50% of a company’s remaining tax liability after all other credits have been applied. Unused credits can be carried forward for up to 10 years.

GRANTS

Governor’s Closing Fund: Discretionary cash grant available to businesses that can demonstrate additional funding is needed to close a competitive cost gap relative to other states in contention for a project that involves new job creation and capital investment.

Job Development Credit:  Discretionary program offers a quarterly cash refund equal to 2%- 5% of the personal withholding taxes of new employees. To qualify, businesses must create at least 10 jobs with wages at or above the average county wage and make a substantial capital investment. The maximum allowable credit is $3,250 per employee, per year.  A business is eligible to claim the credit for up to 10 years provided it retains the number of new jobs specified in the project agreement.   The actual amount of refund a business is eligible to claim will depend on the tier level of the county where the project is located, the gross wages of new employees, as well as other factors.  Cash refund must be used to pay for capital expenditures and cannot be used to reduce state tax liability.    

Economic Development Set-Aside Program: Business expansion and attraction projects may qualify for discretionary state funds for road, water/sewer infrastructure and site improvements

TAX EXEMPTIONS

Sales Tax Exemption: Inventories, intangible personal property, R&D equipment, manufacturing equipment, and industrial electricity are exempt from sales tax.  Construction materials used to construct a $100+ million manufacturing or distribution facility are exempt from sales and use tax.

Data Centers: Businesses that operate data centers may receive exemptions from sales and use taxes in exchange for investing at least $50 million ($75 million for multi-tenant facility) and creating at least 25 jobs with an average wage that is 150% of the county or state per capita wage, whichever is lower.

JOB TRAINING

readySC and Apprenticeship Carolina: These two programs provide recruiting, training, and workforce development tools through the South Carolina Technical College System. Through the Apprenticeship program, eligible businesses can also receive up to $1,000 in tax credits per registered ‘apprentice’ employed for at least seven months during each year of an apprentice’s program for up to 4 years.

 

Last updated: May 2016

 

 


 
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