South Carolina has updated its Internal Revenue Code conformity date from December 31, 2016, to February 9, 2018. This incorporates federal changes from the Tax Cuts and Jobs Act of 2017 and the Bipartisan Budget Act of 2018. But some significant provisions from the TCJA are specifically not adopted, including:
– IRC Sec. 163(j) limit on deduction of business interest;
– IRC Sec. 199A qualified business income deduction, known as the pass-through deduction; and
– IRC Sec. 250 deduction allowed in computing foreign-derived intangible income and global intangible low-taxed income.
In addition, South Carolina’s IRC conformity law already excluded Code Secs. 944 through 989 relating to the taxation of foreign income. So the state also does not adopt:
– IRC Sec. 951A current year inclusion of global intangible low-taxed income by U.S. shareholders; and
– IRC Sec. 965 repatriation tax.
The law provides a $4,110 dependent exemption. The law also allows an additional $4,110 exemption for dependents under age 6.
H.B. 5341, Laws 2018, effective October 3, 2018, applicable to tax years beginning after 2017