Tax Alert: South Carolina Guidance on Tax Relief for Flood Victims

Following the recent Internal Revenue Service tax relief initiative in response to the devastating floods in South Carolina, the South Carolina Department of Revenue (“the Department”) issued SC Information Letter #15-14. The Information Letter outlines South Carolina’s tax relief initiative designed to aid residents and businesses impacted by the flooding, which includes extensions of filing deadlines and grants of relief for certain late payments.

South Carolina Department of Revenue Tax Relief

As previously announced, The South Carolina Department of Revenue is offering the same tax relief as the Internal Revenue Service as it relates to tax filing and payment deadlines. The Department of Revenue is also expanding its initiative to provide the same relief to the following:

  • Individuals and businesses located in counties affected by the flooding
  • Taxpayers who have South Carolina businesses with offices in counties affected by the flooding whose operations have been affected by the flooding
  • Taxpayers whose tax records are located in counties affected by the flooding
  • Taxpayers whose returns are prepared by tax professionals in counties affected by the flooding
  • Relief workers

If the Internal Revenue Service grants relief to additional areas affected by the flooding or grants an additional relief period, the Department will grant the same relief and time period.

The following provisions may be available to affected taxpayers for any taxes administered by the Department or tax returns filed with the Department, including but not limited to income tax returns, sales and use tax returns, admissions tax returns and motor fuel user fee returns:

  • Extensions of time to file tax returns and pay taxes for returns due on or after October 1, 2015 and on or before February 16, 2016 to February 16, 2016 – Affected taxpayers should write “SC Flood” at the top of any paper return for which relief is requested or check the appropriate “disaster area” box if one is provided on the return. Electronically filed returns impacted by the floods do not require any additional action to qualify for relief.
  • Suspension of the enforced collection of any assessed liability of the taxpayer, including installment agreements – Individuals or businesses affected by the flood who receive a penalty notice from the Department should call the Department at the number listed on the notice or call your Elliott Davis Decosimo advisor to discuss the application of any tax relief provided by the Department.
  • Penalty Waiver of penalties due as a result of any extensions or suspension of enforced collection activities.
  • Replacement copies of tax returns, free of charge, for tax returns destroyed as a result of the flooding (Taxpayers should write “SC Flood” on the request for copies of returns.)

Additional tax relief may be provided depending on the specific needs of the persons affected by the flooding.

How We Can Help

If you have questions about how this tax relief may affect you, contact your Elliott Davis Decosimo advisor. You may also call Elliott Davis Decosimo State and Local Tax Practice leader Larry Hyatt (615.651.7035) or Christanna Springs (803.399.9834) directly.

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