Textile revitalization credit

South Carolina offers the Textile Revitalization Credit to encourage the rehabilitation, improvement and redevelopment of abandoned textile mill sites. The credit is designed to support the reuse of properties that were previously used for textile manufacturing operations and related activities.

Companies that invest in qualifying sites may be eligible for a tax credit equal to 25% of rehabilitation expenses.

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Eligible sites

Eligible sites

To qualify, a site must meet the definition of an abandoned textile mill site.

An eligible site must:

  • Have been directly used for textile manufacturing operations or for ancillary purposes related to textile manufacturing; and

  • Be considered abandoned.

For purposes of this credit, “abandoned” means that at least 80% of the site has been closed for a period of at least one year.

Credit options

Available credit options

A company that improves, renovates or redevelops an eligible site may qualify for one of two tax credit options.

Income or license tax credit

A company may claim a credit against income taxes or license taxes equal to 25% of rehabilitation expenses.

Key features of this option include:

  • The credit must be taken in equal installments over five years.

  • The first installment begins in the tax year in which the site is placed in service.

  • The credit may offset up to 100% of income or license tax liability.

  • Unused credits may be carried forward for up to five years.

To qualify for this credit, the taxpayer must file a Notice of Intent to Rehabilitate with the Department of Revenue before receiving building permits.

Real property tax credit

Alternatively, a company may claim a credit against real property taxes equal to 25% of rehabilitation expenses multiplied by the local taxing ratio of each local taxing entity that consents to the credit.

Key features of this option include:

  • The credit may offset up to 75% of property taxes.

  • The credit may be claimed for a period of up to eight years.

To receive this credit:

  • The county or municipality in which the site is located must determine that the site and the proposed project are eligible.

  • A majority of the local governing body must approve the project.

  • Approval must be granted by public hearing and ordinance.

In this case, the taxpayer must file a Notice of Intent to Rehabilitate with the local government before incurring rehabilitation expenses.

How to proceed

How to proceed

Companies considering redevelopment of an abandoned textile mill site should:

  • Confirm that the site meets the statutory definition of “abandoned.”
  • Determine which credit option aligns with their project.
  • File the required Notice of Intent to Rehabilitate with the appropriate authority before proceeding.

Early coordination with the Department of Revenue or the applicable local government is essential to maintain eligibility.

FAQs

Frequently asked questions

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