EARNED INCOME TAX CREDIT (EITC)

Rate (Non-Refundable): 125% of the federal credit

Eligibility Requirements: All South Carolina taxpayers who qualify for the federal credit are automatically eligible.

Latest Legislative Action:

• In December 2024, House Bill 3492 was introduced to amend the EITC, proposing that if the credit exceeds the taxpayer’s state income tax liability, 25% of the excess would be refunded. As of now, the bill is under consideration in the House Ways and Means Committee.
• In 2017, as part of a package of tax bills, lawmakers passed House Bill 3516 providing a nonrefundable state EITC at 125% of the federal credit. The credit was phased in over six years in equal installments of 20.83% beginning in 2018 until it reached 125% in the 2023 tax year.
• Sen. Marlon Kimpson (D) introduced a bill during the 2017 legislative session that would create an EITC worth 20% of the federal credit.

• During the 2015 legislative session, a bill was introduced that would have created a state EITC at 10% of the federal credit and increased the rate by 2.5% per year until it reached 20%. However, the measure never advanced out of committee.

CHILD TAX CREDIT (CTC)

South Carolina does not currently offer a state-level CTC.

Latest Legislative Action: 

• In November 2023, House Bill 4551 was prefiled, proposing a state income tax credit equal to the amount claimed on the federal return for the Child Tax Credit. The bill allows for a carryforward of any excess credit for up to three years. As of January 2024, it remains in the House Ways and Means Committee.

CHILD AND DEPENDENT CARE TAX CREDIT (CDCTC)

Rate (Fully-Refundable): 7% of child care expenses eligible for the federal CDCTC.¹ The maximum credit allowed is $210 for one child or $420 for two or more children.

Eligibility: All South Carolina taxpayers who qualify for the federal credit are automatically eligible, except for spouses filing separately; they are ineligible for any state CDCTC.

Notes: Since the state doesn’t vary this percentage inversely with income, this credit doesn’t target the most relief to lower-income filers.