Jobs tax credit
The Jobs Tax Credit is a financial incentive that supports new and expanding companies creating jobs in South Carolina.
To qualify, a company must create and maintain a required number of net new jobs in a taxable year. New jobs are calculated as the increase in average monthly employment from one year to the next.
Eligible business types
The following types of businesses may qualify for the Jobs Tax Credit:
- Manufacturing and processing
- Warehousing and distribution
- Research and development
- Agribusiness operations
- Qualifying technology intensive facilities
- Corporate office facilities that house a majority of headquarters functions
These businesses must create a monthly average of 10 net new jobs to qualify.
Service-related facility requirements
Qualified service-related facilities must meet different job creation thresholds depending on the county development tier.
Tier IV county
Service facilities located in a Tier IV County must create a monthly average of 10 net new jobs.
Tier I, II, or III County
Service facilities located in Tier I, II or III Counties must create, within a single taxable year, a monthly average of:
- 175 new jobs;
- 150 new jobs in a building that has been vacant for at least 12 months;
- 100 new jobs with an average salary equal to 1.5 times the lower of the state or county per capita income;
- 50 new jobs with an average salary equal to 2 times the lower of the state or county per capita income; or
- 25 new jobs with an average salary equal to 2.5 times the lower of the state or county per capita income.
Credit value by county tier
The value of the Jobs Tax Credit depends on the county’s development tier.
Counties are re-ranked annually based on unemployment rates and per capita income. A county’s tier designation may change from year to year.
| County development tier | Credit value per job |
|---|---|
| Tier I | $1,500 |
| Tier II | $2,750 |
| Tier III | $20,250 |
| Tier IV | $25,000 |
Multi-county industrial parks
A county may join with another county to form a multi-county industrial park. Under this arrangement, the counties share property tax revenue.
Participation in a multi-county industrial park increases the value of the Jobs Tax Credit by $1,000 per job. As a result, credits ranging from $2,500 to $26,000 per job may be available to qualifying companies.
Small business jobs tax credit
A company may qualify for the Small Business Jobs Tax Credit if it:
- Is engaged in manufacturing, processing, warehousing and distribution, research and development, agribusiness, qualified technology intensive activity or operates a corporate office; and
- Has fewer than 99 employees worldwide.
Instead of creating 10 net new jobs, a qualifying small business may instead qualify by creating a monthly average of two net new jobs.
Under the Small Business Jobs Tax Credit:
- The full credit amount is available only for net new jobs that pay at least 120% of the county’s average hourly wage.
- For jobs paying less than 120% of the county’s average hourly wage, credits ranging from $750 to $12,500 per job may be available.
- In a multi-county industrial park, credits may range from $1,750 to $13,000 per job.
Credit period and limitations
For both the Jobs Tax Credit and the Small Business Jobs Tax Credit:
- The credit is available for a five-year period beginning with year two.
- Year one is used to establish the created job levels.
- The credit may be applied against corporate income tax or premium tax.
- The credit may not exceed 50% of the year’s tax liability.
- Unused credits may be carried forward for 15 years from the year earned.
Illustration of estimated credit value
The following example illustrates the potential value of the Jobs Tax Credit for a qualified company creating 100 net new jobs in a Tier II County located within a multi-county industrial park:
| Year | Credit Per Job | Number of Jobs | Annual Total |
|---|---|---|---|
| 1 | Establish qualification | ||
| 2 | $3,750 | 100 | $375,000 |
| 3 | $3,750 | 100 | $375,000 |
| 4 | $3,750 | 100 | $375,000 |
| 5 | $3,750 | 100 | $375,000 |
| 6 | $3,750 | 100 | $375,000 |
| Total Value | $1,875,000 |
Please note:
- The number of new jobs is calculated as the increase in average monthly employment from one year to the next.
- If job levels increase or decrease, the total credit will vary accordingly.
- This example assumes the county remains a Tier II County throughout the credit period.
Frequently asked questions
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