South Carolina

Individual Income Tax

South Carolina has a state income tax, structured as a progressive tax on income.

Tax rates range from 0% - 6.3%.

Estate

Common Law State

Inheritance Tax

South Carolina does not impose an inheritance tax.

Credit Estate Tax

South Carolina imposes an estate tax equal to the maximum credit allowed under the federal tax code for paid state estate and inheritance taxes under IRC Sec. 2011. However, the current federal tax code does not permit a credit for paid state estate or inheritance taxes. Therefore, there is no credit estate tax in effect at this time.

Generation Skipping Transfer Tax (GST Tax)

South Carolina imposes a GST tax equal to the maximum credit allowed under IRC Sec. 2604 for paid state GST tax. However, the current federal tax code does not permit a credit for paid state GST tax. Therefore, there is no current GST tax.

Gift Tax

South Carolina does not impose a gift tax.

Will Creation

The minimum age of a person competent to make a will is 18 (or an emancipated minor or a married person).

The number of witnesses necessary to execute a will is two.

Uniform Gift to Minors Act (UGMA)

The original custodial gift may be a life insurance policy or annuity contract.

Custodial property may be invested in or used to pay premiums on (1) a policy on the minor's life if the minor's estate is the sole beneficiary, or (2) a policy on the life of any of the minor’s parents, grandparents, siblings, aunts and uncles, including relationships by the whole blood, half blood, or adoption, provided the custodian is the designated beneficiary.

The custodial arrangement terminates when the minor reaches age 21 (or upon the death of the minor).

Intestacy

For important general information about the following material, click here.

 Each state describes its own distribution pattern of how property passes to a decedent's spouse, children, parents and siblings. If no such individuals are living, state laws specify other takers among more distant ancestors before awarding property to the state through "escheat" provisions. We do not trace devolution of property beyond those noted above, but cite appropriate statutes for those interested in additional detail.

 Many states refer to their distribution regime by simply stating that the heirs of predeceased individuals take "by representation." We use only the statutory verbiage, but may cite other statutory guidance when it exists.

 States vary in the way they refer to descendants, using such terms as "issue" or simply children or grandchildren. We use the term "descendant," unless usage of different term adds clarity.

 Some states address situations where misconduct or abuse causes forfeiture of a right to receive a share of the estate. Those interested in this information should see the state statutes.

The estate goes to the surviving spouse, as follows:

 If there are no surviving descendants—100% of the estate

 If there are surviving descendants—50% of the estate

If there is no surviving spouse, or if a portion of the estate does not go to the spouse:

 100% to descendants equally, but if of unequal degree, by representation (see S.C. Code §62‐2‐103(1), (3))

If there is no surviving spouse or descendant:

 100% to decedent's parent or parents equally

If there is no surviving spouse, descendant or parent:

 100% to descendants of the decedent's parents (or either parent), by representation (see S.C. Code §62‐2‐103(1), (3))

If none of the above:

 Intestacy laws outline further distribution steps to the level of grandparents, then greatgrandparents and descendants. See S.C. Code §62‐2‐103(4), (5).

 If no legally described recipient can be found, estate assets go to the state of South Carolina.

Click here for more information on intestacy.

Asset Protection

Non-qualified Annuities: No exemption.

Life Insurance Cash Value and Proceeds: The beneficiary interest of a spouse, child or dependent of the insured is exempt from creditors of the insured (as long as the beneficiary is not the insured's estate). However, if the insured filed a petition in bankruptcy within two years of purchasing the insurance, the proceeds and cash surrender value are only exempt up to $4,875.

Unmatured Life Insurance Contract: Except for credit insurance policies, any dividend, interest or loan value is exempt up to $4,875.

Digital Assets: South Carolina follows the South Carolina Uniform Fiduciary Access to Digital Assets Act to ensure that testators can retain control of their digital property and plan for its ultimate disposition.

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