Important Property Tax Exemption for Builders

Residential builders and developers may qualify for a property tax exemption on newly constructed homes in South Carolina that are being held out for sale.  This exemption was enacted this summer, and the guidance is “sparse.” The counties are struggling to understand and comply. We expect inconsistency in application. However, deadlines are approaching that, if missed, may result in a lost benefit.

This exemption applies to improvements to real property but not to the associated land.   The exemption applies to homes that are complete for which a certificate of occupancy, if required, has been issued.  Most counties assess the property at the value of the land until the certificate of occupancy is issued. At the point of issuance of the certificate, the value is increased to the total value including improvements. This exemption rolls back that increase in value for calculating property tax until the home is sold.