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HEAD-TO-HEAD TAX COMPARISON · 2026

COUNTRY A South Carolina VS COUNTRY B Florida

Side-by-side analysis of income tax, effective rates, and take-home pay for South Carolina and Florida in 2026.

Daniel · CountryTaxCalc Updated May 2026 Tax Comparison 2026
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OVERVIEW
South Carolina is a growing retirement destination — the Lowcountry, Hilton Head, Myrtle Beach, and Greenville attract thousands of retirees from northern states each year. But South Carolina does tax retirement income, unlike Florida. South Carolina reformed to a two-bracket system in 2026: 0% on the first $18,050 of taxable income, 5% above. Social Security benefits are fully exempt. Retirees aged 65 and older can deduct $15,000 from their retirement income, reducing the taxable amount. After that deduction, pension income, IRA withdrawals, and 401(k) distributions face a maximum 5% rate. At $75,000 in non-Social Security retirement income, a South Carolina retiree pays approximately $2,098 in state tax while a Florida retiree pays zero. Military retirement pay is fully exempt from South Carolina state income tax. South Carolina and Florida are geographically similar — both coastal, warm, and popular with retirees from the Northeast and Midwest. The key tradeoffs: South Carolina generally has lower property insurance costs than Florida's coastal areas, lower overall cost of living, and distinct seasons. Florida offers zero income tax at all income levels, year-round warmth, and no estate tax. For high-income retirees with substantial pension or IRA income, the income tax difference favours Florida significantly.
Section 01

The Big Picture

Top-line rates and effective take-home for a typical earner — including income tax, social contributions, and applicable surcharges.

🌴
COUNTRY A
South Carolina
TAX RATE
Up to 5%
SS Exempt, $15K Deduction for 65+

Two brackets: 0% to $18,050; 5% above; Social Security exempt; $15,000 retirement deduction for 65+

☀️
COUNTRY B
Florida
TAX RATE
0%
No Income Tax

Zero state income tax on all retirement income sources

TYPICAL ANNUAL DIFFERENCE
Moving from Florida → South Carolina at $75,000
~$2,098

Florida saves approximately $2,098/year vs South Carolina at $75K retirement income (excluding Social Security). South Carolina's $15,000 deduction for retirees 65+ reduces the taxable base; remaining income above $18,050 faces a 5% rate.

Section 02

Tax Savings by Income Level

Net take-home after all income tax, social contributions, and surcharges — for a single employee with no dependents.

GROSS INCOME
🌴 SC TAX
☀️ FL TAX
SAVINGS
10-YEAR
$50,000 retirement
~$848
$0
FL saves ~$848/yr
$8,480
$75,000 retirement
~$2,098
$0
FL saves ~$2,098/yr
$20,980
$100,000 retirement
~$3,348
$0
FL saves ~$3,348/yr
$33,480
$150,000 retirement
~$5,848
$0
FL saves ~$5,848/yr
$58,480
$250,000 retirement
~$10,848
$0
FL saves ~$10,848/yr
$108,480
💡

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South Carolina Pros & Cons

+ PROS
  • Social Security fully exempt from South Carolina state income tax
  • Military retirement pay fully exempt from state income tax
  • $15,000 retirement income deduction for retirees aged 65+
  • Lower property insurance costs than coastal Florida — no direct hurricane exposure for inland areas
  • No state estate or inheritance tax
  • Lower cost of living in most areas compared to Florida's popular retirement markets
− CONS
  • 5% top rate on income above the $18,050 bracket — still meaningful for higher-income retirees with large pension or IRA distributions
  • Pensions, IRA withdrawals, and RMDs taxed after the $15,000 deduction at up to 5%
  • Effective SC rate still higher than zero — Florida's zero income tax is a decisive advantage for high-income retirees regardless of bracket improvements
  • Property taxes in areas like Charleston can be high for non-primary residents
☀️

Florida Pros & Cons

+ PROS
  • Zero state income tax on all retirement income — no thresholds or deductions to track
  • No estate or inheritance tax
  • Homestead Exemption up to $50,000 on primary residence reduces property tax
  • Year-round warmth — lower heating costs and lifestyle benefits
  • Large retirement communities with established amenities and services
− CONS
  • Property insurance crisis: average $4,000–$8,000+/year in many counties, far exceeding most South Carolina areas
  • Hurricane risk is higher and more direct than inland South Carolina
  • Hot humid summers throughout the state
  • Higher cost of living in popular Florida retirement markets (Naples, Sarasota, The Villages)
FAQ

Frequently Asked Questions

Is Social Security taxed in South Carolina?

No. South Carolina fully exempts Social Security benefits from state income tax. This applies regardless of your total income. For retirees whose primary income is Social Security, South Carolina and Florida are practically equal on state tax burden. The South Carolina tax disadvantage emerges on pension income, traditional IRA withdrawals, 401(k) distributions, and RMDs — all of which are taxed above the $15,000 retirement deduction.

What is the $15,000 retirement deduction in South Carolina?

South Carolina allows retirees aged 65 and older to deduct $15,000 from their retirement income before calculating state income tax. For married couples where both spouses are 65+, each can deduct $15,000, for a combined $30,000 deduction. Retirement income eligible for this deduction includes pensions, IRA and 401(k) withdrawals, and annuities. Social Security is separately exempt. Retirees aged 65 and under receive a smaller deduction of $3,000.

Is military retirement pay taxed in South Carolina?

No. South Carolina fully exempts military retirement pay from state income tax. This is separate from the general $15,000 retirement deduction — military retirees get a full exemption on their pension regardless of amount. This makes South Carolina very competitive with Florida for military retirees. Combined with the Social Security exemption, a military retiree drawing mostly pension and SS income faces minimal South Carolina state tax.

How does South Carolina's income tax rate compare to other southern retirement states?

South Carolina's top rate is 5% (two brackets: 0% to $18,050 taxable; 5% above), which is competitive in the South. For comparison: Georgia is 4.99% flat with a $65,000 retirement exclusion for 65+; North Carolina is 4.5% flat; Tennessee and Florida are 0%; Texas has no income tax. South Carolina's saving grace is the Social Security exemption, military pension exemption, and the $15,000 deduction — these reduce the effective tax burden for moderate-income retirees substantially.

How do property taxes compare in South Carolina vs Florida?

South Carolina's average effective property tax rate is approximately 0.49% — lower than Florida's ~0.78%. South Carolina also offers a 4% primary residence assessment rate versus a 6% rate for investment properties, which helps retirees in their primary home. For a $300,000 home, South Carolina property tax would be roughly $1,470 versus Florida's roughly $2,340 (before Florida's Homestead Exemption). After Florida's $50,000 Homestead Exemption, the gap narrows. Both states are reasonable on property tax compared to northeastern states.

Is moving from South Carolina to Florida worth it for retirement?

It depends on your income. At $75,000 in non-Social Security retirement income, you'd save about $2,098/year by moving to Florida. At $150,000, you'd save $5,848/year. However, Florida's property insurance costs ($4,000–$8,000/year) may offset $2,000–$5,000 of that saving depending on where you live. Retirees with military pensions or income primarily from Social Security may find the after-insurance saving is minimal. High-income retirees with large IRAs and pension distributions gain the most from Florida's zero income tax.

Does South Carolina have an estate or inheritance tax?

No. South Carolina has no state estate tax or inheritance tax. Estates are subject only to the federal estate tax, which exempts the first $15 million per individual in 2026 (OBBBA — permanent). This matches Florida, making both states equal for estate planning purposes. Neither state imposes additional state-level taxes on wealth transferred at death.
From the brief
NL27%new 2027 rate, down from 30%
DK65.4kkr/mo threshold, cut from 78k
MT1940snon-dom regime unchanged since
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