According to South Carolina Instructions for Form SC1040, here is a list of South Carolina's Other Additions.
- Taxpayers that claim bonus depreciation under federal law must add back the difference between the bonus depreciation taken and the depreciation which would have been allowed without bonus depreciation.
- Taxpayers who claim a nonrefundable Exceptional Needs Children Education credit for contributions to a nonprofit scholarship funding organization are not allowed a deduction for these contributions. If a taxpayer deducts the amount of the contribution on his or her federal return, the taxpayer must add back the amount of the deduction for South Carolina purposes.
- Taxpayers that claim a child care program credit for donations to a nonprofit corporation (Sch. TC-9) are not allowed a deduction for those donations. The disallowed deductions are an addition to federal taxable income.
- Taxpayers that claim credits such as the Community Development Credit (Sch. TC-14), the Industry Partnership Fund Credit (Sch. TC-36), and the Hydrogen Infrastructure Development Credit (Sch. TC-47), may not claim a deduction for the same qualified contribution which results in the credit.
- Add back the federal net operating loss when it is larger than South Carolina net operating loss being claimed
- Add back any expenses deducted on the federal return related to any income not taxed by South Carolina. Some examples are investment interest to out-of-state partnerships and interest paid to purchase US obligations
- Federal net operating loss when claiming a larger amount than for state purposes is an addition.
- Expenses deducted on the federal return related to any income exempt or not taxed by South Carolina is an addition. Some examples are investment interest to out-of-state partnerships and interest paid to purchase United States obligations.
- Foreign areas allowances, cost of living allowances and/or income from possessions of the U.S. are additions to federal taxable income.
- Effective for qualifying investments made after June 30, 1998, taxpayers must reduce the basis of the qualifying property to the extent the Economic Impact Zone Investment Tax Credit is claimed. An addition to federal taxable income must be made for the resulting reduction in depreciation.
- Add back the qualified business income deduction under IRC Section 199A
- A charitable contribution deduction under IRC Section 170 for a gift of land must be added back unless the contribution also meets the requirements of S.C. Code Section 12-6-5590.
A business must add back any amount paid for services performed by an unauthorized alien if the amount is $600 or more a year.
South Carolina does not adopt the individual income tax provisions of section 204(a) of the Taxpayer Certainty and Disaster Tax Relief Act of 2019. Individuals will need to add back any increased contributions allowed under this section.
Add back the increased charitable contribution deduction amounts allowed on the federal return under the Cares Act.
Add back amounts for business meals under IRC 274(n) that were deducted in full on the federal return. South Carolina allows a 50% deduction for qualifying business meals.
- Include any withdrawals during the tax year from a Catastrophe Savings Account that were:
- necessary because contributions were more than the allowable limits; OR
- more than the amount needed to cover qualified catastrophe expense.
Do not include any withdrawals made by a spouse surviving the spouse who set up the Account.
- As of January 1, 2009, a business must add back any amount paid for services performed by an unauthorized alien if the amount is $600 or more a year.
Depending upon how a particular item was reported or deducted, the following items may be an addition or a subtraction:
- A change in the accounting method to conform in the same manner and the same amount to the federal. This may be an addition or a subtraction. At the end of the federal adjustment, any balance will continue until fully adjusted.
- The installment method of reporting is to be adjusted if the entire sale has been reported for state purposes or to continue on an installment basis if the entire sale has been reported for federal purposes. This may be an addition or a subtraction.
- Adjust the federal gain or loss to reflect any difference in the South Carolina basis and federal basis. This may be an addition or a subtraction.
For additional information, please see the Instructions for Other Additional Income.