South Carolina · H.4216 / Act 110
SC income tax changes (H.4216, Act 110): two brackets, a 5.21% top rate and the new SCIAD deduction for 2026 returns
Free. Nonpartisan. Unsubscribe anytime.
The short version
- Starting with 2026 income, SC has two brackets: 1.99% on taxable income under $30,000, and for $30,000 or more, 5.21% of taxable income minus $966. The bracket amounts are adjusted for inflation each year.
- SC taxable income now starts from federal adjusted gross income. The federal standard deduction, itemized deductions and several other federal deductions no longer carry over. They are replaced by the SC Income Adjusted Deduction (SCIAD): $15,000 for single filers, $22,500 for head of household and $30,000 for married filing jointly.
- SCIAD shrinks as income rises and ends at federal AGI of $95,000 for single filers, $142,500 for head of household and $190,000 for joint filers. SCDOR plans a SCIAD calculator on MyDORWAY.
- The state earned income tax credit is capped at $200. Starting with tax year 2027, the 5.21% top rate drops if revenue triggers are met. Act 110 requires SCDOR to adjust withholding tables, but as of Oct. 27, 2026, its website still posts the 2026 tables dated Nov. 4, 2025.
- Status
- Law. Signed by the Governor March 30, 2026; ratified as R117, Act No. 110. Applies to tax years beginning January 1, 2026 (2026 returns due April 15, 2027).
- Official source
- SC Legislature, 2025-2026 Bill 4216 (Act No. 110)
SCDOR Information Letter #26-20, Individual Income Tax Reform (Aug. 31, 2026)
Tax brackets and rates
For tax years beginning after 2025: (§ 12-6-510(C)(1), Act No. 110 Section 1; SCDOR IL #26-20)
| SC taxable income | 2026 tax |
|---|---|
| $0 to $29,999 | 1.99% of taxable income |
| $30,000 or more | 5.21% of taxable income, minus $966 |
The bracket amounts are adjusted each year with the chained Consumer Price Index. (IL #26-20; § 12-6-520)
Future cuts. Starting with tax year 2027, the 5.21% rate must go down in any year the Board of Economic Advisors projects individual income tax revenue to grow at least 5%. Each cut is the greater of $200 million or 25% of the recurring surplus, but no more than the projected increase. Cuts continue until the top rate reaches 1.99%. After that, the single rate keeps falling the same way toward zero. (§ 12-6-510(C)(2)–(3); IL #26-20)
The new deduction (SCIAD)
SC no longer adopts federal Internal Revenue Code Section 63(b)–(g). SCDOR lists what this removes: the standard deduction, itemized deductions, the senior deduction, the qualified tip deduction, the overtime deduction, the car loan interest deduction, the qualified business income deduction, and the charitable deduction for non-itemizers. SC taxable income now starts from federal AGI. (Act No. 110 Section 2; IL #26-20)
In their place is the South Carolina Income Adjusted Deduction: (§ 12-6-1140(15); IL #26-20)
| Filing status | Full SCIAD | Starts shrinking above AGI of | Gone at AGI of |
|---|---|---|---|
| Single or married filing separately | $15,000 | $40,000 | $95,000 |
| Head of household | $22,500 | $60,000 | $142,500 |
| Married filing jointly or surviving spouse | $30,000 | $80,000 | $190,000 |
In between, the deduction is reduced by a fraction. For single filers, the fraction is (AGI − $40,000) ÷ $55,000. For head of household, it is (AGI − $60,000) ÷ $82,500. For joint filers, it is (AGI − $80,000) ÷ $110,000. SCDOR says any reduction amount that is not a multiple of $10 is rounded down to the next lowest $10. It plans to offer a SCIAD calculator on MyDORWAY. (IL #26-20) Nonresidents prorate SCIAD by the share of their AGI that is from SC. (Act No. 110 Section 5)
Other changes
- Earned income tax credit. SC’s credit is still 125% of the federal EITC, nonrefundable, but now capped at $200. (§ 12-6-3632; IL #26-20)
- Who must file. Under 65, you must file if SC gross income is over $15,000 (single or married filing separately), $22,500 (head of household) or $30,000 (married filing jointly). The thresholds are higher at 65 and older, up to $60,000 for a joint return with both spouses 65 or older. (IL #26-20)
- Withholding. The act directs SCDOR, with the Revenue and Fiscal Affairs Office, to adjust the withholding tables. (Act No. 110 Section 6) As of October 27, 2026, SCDOR’s withholding page lists 2026 and 2025 tables. The posted 2026 formula (WH-1603F) is dated November 4, 2025, before the act passed. We did not find an announcement of revised tables.
When it applies and what you can do
- The act took effect when signed (March 30, 2026) and first applies to tax years beginning after 2025, so your 2026 return, due April 15, 2027. It does not change 2025 returns. (Act No. 110 Section 8; SCDOR news, Sept. 1, 2026)
- If you make estimated payments, SCDOR says to review IL #26-20 and use the 2026 Estimated Tax Worksheet on Form SC1040ES. Estimated payments are required if you expect to owe $100 or more. (SCDOR news, Sept. 1, 2026)
Current status
Recorded roll calls include House 64–47, Senate 39–5, and House 71–49 to agree to the final version. It was ratified March 25 and signed March 30, 2026, as Act No. 110. (Bill history)
Sources
- SC Legislature: 2025-2026 Bill 4216 (Act No. 110), status, history and ratified text
- SCDOR Information Letter #26-20: Individual Income Tax Reform (PDF, Aug. 31, 2026)
- SCDOR: Estimated Income Tax payments due September 15? Read Information Letter #26-20 first
- SCDOR: Withholding Forms and tables
Get the next explainer in your inbox
South Carolina and federal laws, explained in plain English. One email a week: what changed and what it means for you. Confirm your address and get the free South Carolina 2026-27 Law Guide (PDF).
Free. Nonpartisan. Unsubscribe anytime. We'll email you a link to confirm. Privacy policy
Every statement above is drawn from the official source text linked here; section references are shown in grey. This is a plain-English summary, not legal advice. Spot an error? Tell us.