South Carolina Code of Regulations › Chapter 117 - DEPARTMENT OF REVENUE › Article 12 - INCOME TAX › Subarticle 9 - TAXABLE INCOME CALCULATION › Section 117-640.1 - Military Pay, Non-Service Income, and Income Earned by Military Spouses

Current through Register Vol. 48, No. 6, June 28, 2024
1. Military pay in
				general: Under the provisions of Sections
				12-6-510,
				12-6-560,
				and
				12-6-570,
				military pay is reportable for South Carolina income tax purposes.
2. Nonresident armed services personnel:
				Under the Soldiers' and Sailors' Civil Relief Act, members of the armed
				services, who are legal residents of other states stationed within South
				Carolina by virtue of military orders, are not subject to South Carolina income
				tax on their service pay. They are, however, subject to tax on any other income
				earned in South Carolina which would be taxable to a nonresident. Income earned
				in South Carolina by a spouse of a military servicemember is taxable to South
				Carolina.
The personal exemptions and deductions of a nonresident
				  servicemember's spouse must be prorated in ratio to the spouses adjusted gross
				  income within this State to the spouses entire adjusted gross income wherever
				  earned. The spouse would not be entitled to claim exemptions for dependents
				  unless the spouse can prove that he or she furnishes more than fifty percent of
				  their support for the entire year.
3. Establishment of New Domicile: There is
				nothing in the Soldiers' and Sailors' Civil Relief Act or in the South Carolina
				statutes which would prevent a servicemember from changing his or her legal
				residence. To effect a change of legal residence, however, there must not only
				be an intention of making the new location the domicile of the servicemember,
				but also there must be the factual establishment of a domicile in the new
				location.
The establishment of a permanent residence (or domicile) in a
				  new state ordinarily requires physical presence of the person in the state long
				  enough to establish evidence of having taken up residence in the state. Some of
				  the tests or factors to consider in determining such permanent residence (or
				  domicile) include the following:
(a)
				Place of birth.
(b) Permanent
				residence of parents.
(c) Family
				connections, close friends.
(d)
				Address given for military purposes.
(e) Payment of state bonus (in most cases
				when a state pays a bonus to a servicemember, the servicemember must be a
				permanent resident to be eligible).
(f) Civic ties, church membership, club or
				lodge membership.
(g) Bank account
				or business connections.
(h)
				Payment of state income taxes.
(i)
				Continuous car registration and driver's license.
(j) Listing of "legal" or "permanent" address
				on Federal tax returns.
(k) Voting
				by absentee ballot.
(l) Occasional
				visits or spending one's leave "at home."
(m) Ownership of a home.
(n) Execution of approved certificates or
				other statements indicating permanent residence.
(o) Expression of intention.
Our administrative policy is in accord with the military
				  services and the courts, including Federal courts, which, when arbitrating
				  disputes over residency, have consistently held that a legal residence (or
				  domicile) is not abandoned until a definite residence is established
				  elsewhere.