South Carolina completed a major tax reform (H.4216 / Act 110) — replacing its old 3-bracket progressive system (0% to 6%) with just 2 brackets: 1.99% on income under $30,000, then 5.21% (minus a $966 subtraction) on income at or above $30,000, plus a brand-new income-adjusted standard deduction (the SCIAD) that starts at $15,000 for single filers and phases out between $40,000 and $95,000 of federal AGI. This dramatically simplifies South Carolina's tax code and cut the top rate from 6% to 5.21%, making SC significantly more competitive for the Southeast. At $100K income (where the SCIAD has fully phased out), residents now pay $4,244 state tax.
How does it fit the regional picture? South Carolina competes for retirees and remote workers with Southeast states such as Florida (0%) and Tennessee (0% on wages), and with its two bordering states, North Carolina (3.99% flat, down from 7.75% in 2013) and Georgia (4.99% flat). By restructuring to 1.99%/5.21% and adding the SCIAD, SC improved its position in the Southeast, though it now sits close to — not below — Georgia and North Carolina at $100K.
How it compares now:
Retirement advantages: SC does NOT tax Social Security benefits, military retirement income (fully deductible), and many pension incomes. Combined with the new lower rate, SC is increasingly attractive for retirees from northeast states.
Note: These are marginal rates — you only pay the higher rate on income within each bracket.
Here's what South Carolina residents actually pay at different income levels (2026, single filer, standard deduction):
| Annual Income | Federal Tax | State Tax | Total Tax | Take-Home Pay | Effective Rate |
|---|---|---|---|---|---|
| $50,000 | $3,820 | $1,000 | $4,820 | $45,180 | 9.6% |
| $75,000 | $7,670 | $2,657 | $10,327 | $64,673 | 13.8% |
| $100,000 | $13,170 | $4,244 | $17,414 | $82,586 | 17.4% |
| $150,000 | $24,734 | $6,849 | $31,583 | $118,417 | 21.1% |
| $250,000 | $51,304 | $12,059 | $63,363 | $186,637 | 25.3% |
Note: Includes federal and state income tax only. Does not include FICA (Social Security/Medicare), which adds 7.65% for employees.
Key takeaway: At $100K, South Carolina takes $4,244 in state tax alone.
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Migration Trends: The U.S. Census Bureau publishes state-to-state migration flows (linked below); check its latest release for current in- and out-migration figures for South Carolina.
Why people move here:
Why people leave:
Tax considerations if moving here:
| State | Tax Rate | Tax on $100K Income | Difference from South Carolina |
|---|---|---|---|
| South Carolina | 1.99-5.21% | $4,244 | Baseline |
| North Carolina | 3.99% flat | $3,481 | −$763 (save) |
| Georgia | 4.99% flat | $4,242 | −$2 (save) |
| Tennessee | 0% | $0 | −$4,244 (save) |
| Florida | 0% | $0 | −$4,244 (save) |
Key insight: South Carolina's tax reform meaningfully lowered rates from the old 6% top bracket, but at $100K income SC ($4,244) is now more expensive than both Georgia ($4,242, by $2) and North Carolina ($3,481, by $763) — the SCIAD deduction that keeps SC competitive at lower incomes has fully phased out by $100K, leaving the 5.21% top rate exposed. Moving from SC to Florida or Tennessee saves $4,244/year at $100K. The reform narrowed SC's disadvantage vs zero-tax states, but middle-income earners (below ~$95K AGI) benefit far more from the reform than high earners do, since the SCIAD only helps below that threshold.
The retirement picture:
Post-reform comparison: At $100K, SC state tax is now $4,244. The SCIAD deduction only helps filers below about $95K of AGI, so middle-income filers benefit most from the new structure.
South Carolina now has 2 tax brackets for 2026 following major reform (H.4216/Act 110): 1.99% on income under $30,000, then 5.21% (minus a $966 subtraction) on income at or above $30,000, applied after a new income-adjusted standard deduction (SCIAD) that starts at $15,000 for single filers and phases out between $40,000 and $95,000 of AGI. This replaced the old 3-bracket system (0%-6%). At $100K income (where the SCIAD has fully phased out), state tax is $4,244 (4.24% effective rate).
South Carolina has just 2 tax brackets for 2026 (simplified from 3 brackets): 1.99% on taxable income under $30,000, and 5.21% (minus a $966 subtraction, so the math is continuous across the bracket boundary) on income at or above $30,000. This is a major simplification — the old system had three brackets (0%, 3% and a 6% top rate for 2025). Alongside the new brackets, SC also introduced the SCIAD — a $15,000 standard deduction for single filers (federal AGI minus SCIAD = SC taxable income) that phases out linearly between $40,000 and $95,000 of AGI, so middle-income filers get meaningfully more tax-free income than the brackets alone suggest.
Post-reform, SC is now competitive but not the cheapest of the three at $100K: SC $4,244 vs North Carolina $3,481 (NC is cheaper by $763/year) vs Georgia $4,242 (GA is cheaper by $2/year). Below roughly $95K AGI, SC's new SCIAD deduction narrows or even reverses this gap, since it isn't yet fully phased out — SC is most competitive for middle-income earners, not high earners. Florida and Tennessee still beat SC outright (0% vs $4,244/year), and SC's no-Social-Security-tax rule still makes it competitive for retirees.
No, South Carolina does not tax Social Security benefits at all. Combined with the lower 5.21% top rate (down from 6%), a full deduction for military retirement income, and a $50,000 property tax homestead exemption for homeowners 65+ (also disabled or blind), SC is increasingly attractive for retirees. The combination of no Social Security tax + a 5.21% top rate + lower cost of living than Florida makes SC a compelling retirement destination.
Move if: relocating from high-tax Northeast states (SC $4,244 vs NY $4,861 saves $617/year at $100K), retiring with Social Security (untaxed), military retiree (retirement pay fully deductible), or you're a middle-income earner who benefits from the new SCIAD deduction (much bigger savings below ~$95K income). Consider staying or choosing NC/GA if: you're a high earner already in a low-tax Southeast state — both NC ($3,481) and GA ($4,242) now beat SC ($4,244) at $100K — need specific job markets, or prefer no income tax at all (Florida, Tennessee). SC's reform is real and meaningful, but mainly for middle incomes, not high earners.
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How we calculate: Our South Carolina tax calculator uses official 2026 tax brackets from the South Carolina Department of Revenue. We apply marginal tax rates correctly (only income within each bracket is taxed at that rate), subtract the SC income-adjusted deduction (SCIAD) where it applies, and calculate effective tax rates.
Data sources:
Verification: All tax rates and brackets verified against SCDOR Information Letter #26-20 (August 31, 2026).
Limitations: Assumes single filer, SCIAD only (SC no longer uses the federal standard deduction), W-2 income only. Does not include: itemized deductions, credits (EITC, child tax credit), military retirement deductions, Social Security income exclusions, business income, capital gains. Property tax data is statewide averages; actual rates vary by county.
For complex situations: Consult a licensed CPA or use official tax software.
Last Updated: October 2026
Verified By: Daniel · CountryTaxCalc
Contact: For corrections or questions, visit our contact page.
Last Updated: October 2026