To help ease the financial burden for South Carolina college students and their families, the South Carolina General Assembly has created an income tax credit for tuition paid to South Carolina colleges and universities.
The following information should answer most of your questions about the tax credit.
Who can claim the credit?
The student, parents, guardian or whomever actually pays the tuition and claims the student as a dependent on their tax return may claim the credit. If the parent and student split the cost of the tuition, they also may split the credit on the tax return. However, the combined credit claimed by the parent and student may not exceed the maximum amount of the credit. Parents or guardians with more than one student in college may claim a credit for each qualifying student.
Who qualifies for the credit?
- Students must have completed their high school education in May 1997 or afterwards.
- Students must have graduated from a South Carolina high school or home school program in South Carolina. Students may also qualify if they graduated from an out-of-state prep school as long as the parent or guardian remained a South Carolina resident.
- Students must qualify for in-state tuition
- Students must compete at least 30 credit hours by the end of the tax year in which the credit is claimed
- Students must be enrolled in an undergraduate degree program or at a one-year undergraduate certificate or diploma program.
- Students cannot have been convicted or pled guilty or no contest to any felonies or alcohol or drug crimes in any state. (This does not apply if the criminal record has been expunged.)
- Students cannot be in default on any student loans.
- Students may not claim the credit if they are recipients of the LIFE Scholarship or the Palmetto Fellowship. If the student loses the scholarship, a tax credit may be claimed for the time remaining in the four-year credit period if the student otherwise qualifies.
- Students must be in good standing at the school.
- Must enroll in college within 12 months of high school graduation.
How much is the credit?
You can claim a credit on your personal income tax return of 25% of the actual tuition paid to the college each taxable year. The credit allowed for tuition paid to private colleges is based on the average tuition paid to public four-year South Carolina colleges as determined each year by the Commission on Higher Education. The maximum credit is $850 a year if you attend a four-year school and $350 a year if you attend a two-year school.
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