SC State Legislators pass a State Earned Income Tax Credit

Earned Income Tax Credit logo

The SC Association for Community Economic Development along with many partner advocates worked for years to lower taxes on low-wage South Carolinians and their families through a refundable state-level EITC worth 20 percent of the federal credit.

On May 11, 2017 a nonrefundable EITC worth 125% of the federal credit was tacked on to the "Roads" bill by Democratic lawmakers in an attempt to mitigate the burden of a proposed gas tax on lower-income workers. Governor Henry McMaster (R) vetoed the legislation on Wednesday for reasons unrelated to the EITC, but the legislature overrode his veto today, and the bill goes into effect July 1.

"Although the enactment of a state-level EITC will bring much-needed tax relief to many low-wage South Carolinians, the credit could benefit many more if it were eventually made refundable. Those earning the least owe little to no income tax and are often unable to benefit from nonrefundable EITCs, despite paying other taxes like sales and payroll. According to the Institute on Taxation and Economic Policy, only about 2% of South Carolinians with the lowest incomes (below $21,000) will benefit from the new EITC. Eventually making the credit refundable would help more of these families make ends meet. to sustain and enhance their programs, activities, and services." - Tax Credits for Workers and Their Families (TCWF)

County Health Rankings Released

County Health Rankings

The annual County Health Rankings will be released on March 29th. The health of nearly all counties in the nation is measured and then ranked within the states. The rankings are compiled using county-level measures from a variety of national and state data sources. This valuable tool enables you to view an overview and comparison of South Carolina's counties complete with downloads of relative documents dating back to 2010.

The rankings are based on a model of population health that emphasizes the many factors that, if improved, can help make communities healthier places to live, learn, work and play. Building on the work of America's Health Rankings, the University of Wisconsin Population Health Institute has used this model to rank the health of Wisconsin’s counties every year since 2003. 

City of Columbia Employees Participate in Poverty Disaster Simulation

City of Columbia Employees participate in Poverty Disaster Simulation

On February 3rd, City of Columbia employees were invited to participate in a poverty simulation to help people better understand the complicated life one lives when in poverty. The event was coordinated by the American Bar Association and held at the South Carolina Bar Conference Center. Members of the Columbia legal community were also in attendance including students and faculty and staff from the University of South Carolina School of Law.

The simulation lasted 2.5 hours and was broken up into five “weeks,” with each week lasting approximately 15 minutes. Attendees were given character profiles which included their character’s name and a brief backstory of their experiences. They were then broken into teams, or "families", and had the goal of meeting their families’ most basic needs. Volunteers took on roles as bank representatives, social service workers, day-care providers, legal aid attorneys, grocers and employers, all offering services or goods the families needed to survive.

The following video highlights the simulation in February, and more detailed information can be found in this article.

2017 VITA Awareness Day

The VITA Program

March 15, 2017, is VITA Awareness Day. Each year, the Volunteer Income Tax Assistance (VITA) program puts billions of dollars back in the pockets of low-income taxpayers nationwide. In 2015, CFED launched their first-ever VITA Awareness Day to call attention to the importance of VITA programs in the communities they serve. CFED has engaged partners and advocates, like SCACED, across the country to help raise the profile of community tax preparation.

Below are some interesting data points that CFED has shared in regards to VITA programs in South Carolina. During the 2015 filing season alone, they:

  • Stimulated the local economy by helping taxpayers receive $39,589,030 in tax refunds – which will be recirculated in the state
  • Filed more than 39,288 federal tax returns and 39,685 state tax returns
  • Helped hard-working families file 8,842 Earned Income Tax Credit (EITC) claims for a total of $12,030,053 – and in the process, given that the average EITC tax filer spends $400 on tax preparation, saved low-income EITC taxpayers approx. $3,536,800 that would have otherwise been spent on paid tax preparers
  • Helped 3,746 struggling families receive a total of $4,617,146 to offset childcare expenses and better support their children

The CFED believes that promoting community tax preparation is especially important in South Carolina since Senator Tim Scott sits on the Senate Finance committee that is instrumental to advancing federal VITA legislation. To support these efforts, you can contact Senator Scott and encourage him to co-sponsor S. 193, the VITA bill that would increase access to VITA services for low-income and under-served populations.

Community Development Tax Credit Bills Introduced

Community Development Tax Credit Bills introduced

The top priority of SCACED's 2017 Public Policy Agenda is to pass new community development tax credit legislation in South Carolina, so we are thrilled to announce that the bill has been introduced in each of the chambers. Senate Bill S.412 gives a 100% tax credit, and House Bill H.3842 has a tax credit of 33%. We ask that everyone take a moment to message Senator Paul Campbell and Representative Gary Simrill to thank them for their leadership in increasing economic development in our state.

For the past 23 years, SCACED has advocated for policies to advance the community economic development industry in South Carolina. Our landmark legislative success was the passage of the SC Community Economic Development Act. This law has set the stage for attracting capital to low-wealth communities and unleashing the innovation that exists in our communities.  We now seek to improve upon the SC CED Act with legislation that will expand and improve the SC Community Development Tax Credit.

The new legislation will increase the community development tax credit from 33% to 100%, increase the annual amount of tax credits from $1 million to $5 million and expand the eligibility of financial institutions to use the tax credits for targeted investments in low wealth communities. This means that an investment in a certified community development corporation (CDC) or community development financial institution (CDFI) will benefit the investor by allowing them a 100% credit against their state income, bank, corporate tax or premium tax liability. This is a powerful incentive to attract private capital into low-wealth communities through certified non-profits.

 Senate Bill S.412 will increase economic development by:

  • Increasing the tax credit from 33% to 100% creating an even greater incentive for private capital to flow into low-wealth communities.
  • Increasing the amount of credits available statewide from one million dollars annually to five million dollars annually.
  • Ensure the equitable distribution of tax credits by stipulating that a portion of the tax credits (25%) be available to small rural-based CDC’s during the first three quarters of each tax year.
  • Expanding eligibility to all banks and financial institutions that operate in SC rather than just those chartered here. This will improve the likelihood of investments in CDC’s and CDFI’s.

House Bill H.3842 will accomplish all of the above, with the exception of the tax credit remaining at 33%.

  • Additional Amendments: Unused tax credits will no longer be carried forward, so the program is capped at $5M per year. However, individual taxpayers will continue to be allowed to carry forward tax credits for up to ten years when those credits exceed the taxpayer’s tax liability for a given year.

House Bill H.3842 is currently in the SC House Ways and Means Committee.  Please contact your representative and ask them to sign on as a co-sponsor of the legislation.  You may find your representative by clicking here and entering in your zip code.  Additionally, please contact members of the SC House Ways and Means Committee and ask them to vote in favor of the H.3842. You can access information on members of the SC House Ways and Means Committee below by clicking the links below.

SC House Ways and Means Committee

White, W. Brian, Chairman

Simrill, J. Gary, 1st V.C.

Cobb-Hunter, Gilda, 2nd V.C.

Anthony, Michael A. "Mike"

Bales, Jimmy C., Ed.D.

Ballentine, Nathan

Clemmons, Alan D.

Clyburn, William "Bill"

Cole, J. Derham, Jr.

Erickson, Shannon S.

Finlay, Kirkman, III

Hayes, Jackie E. "Coach"

Herbkersman, William G. "Bill"

Hosey, Lonnie

Huggins, Chip

Loftis, Dwight A.

Lowe, Phillip D.

Merrill, James H.

Pitts, Michael A.

Smith, G. Murrell, Jr.

Smith, Garry R.

Sottile, F. Michael "Mike"

Stavrinakis, Leonidas E. "Leon"

Whitmire, William R. "Bill"

Senate Bill S.412 is currently in the SC Senate Finance Committee. You may find your senator by clicking here and entering in your zip code. You can access information on members of the SC Senate Finance Committee below by clicking the links below. Please contact members of the SC Senate Finance Committee and ask them to vote in favor of the S.412.

SC Senate Finance Committee Members

Leatherman, Hugh K., Sr., Chairman

Setzler, Nikki G.

Peeler, Harvey S., Jr.

Courson, John E.

Matthews, John W., Jr.

Reese, Glenn G.

Alexander, Thomas C.

Grooms, Lawrence K. "Larry"

Verdin, Daniel B. "Danny", III

Cromer, Ronnie W.

Jackson, Darrell

Williams, Kent M.

Campbell, Paul G., Jr.

Davis, Tom

Nicholson, Floyd

Sheheen, Vincent A.

Martin, Shane R.

Scott, John L., Jr.

Allen, Karl B.

Gregory, Chauncey K.

Bennett, Sean M.

Corbin, Thomas D. "Tom"

Hembree, Greg