Instructions For Form Sc1040 - 2011 (Page 5 of 9) in pdf

Instructions - South Carolina Form SC1040

Line q - AGE 65 AND OLDER DEDUCTION

EXEMPTION WORKSHEET

Beginning in the tax year in which a resident reaches age

sixty-five, he or she is entitled to a deduction of $15,000 against

Federal personal exemption amount

$3,700

any SC income. Line q-1 applies to the taxpayer whose name

Number of dependents claimed on

appears first on the return. Line q-2 applies to the spouse whose

your federal return who had not

name appears second on the return.

The amount of the

reached age six during the tax year

deduction on line q-1 is reduced by any individual retirement

deduction claimed on line p-1. The amount of the deduction on

Allowable deduction, enter this

line q-2 is reduced by any individual retirement deduction claimed

amount on line t.

on line p-2. The age-65-and-over deduction is not reduced by

any surviving spouse retirement deduction claimed on line p-3 or

Line u - OTHER SUBTRACTIONS FROM INCOME

p-4.

Since these subtractions apply only to a few people, they are not

Worksheet for Taxpayer line q-1:

fully explained in these instructions. Attach an explanation of

your entry on this line. Some examples of items which may be

Maximum deduction allowed for taxpayer

$15,000

subtracted on this line are:

South Carolina does not recognize bonus depreciation in IRC

Amount claimed on line p-1 for the taxpayer

Section 168(k). With or without bonus depreciation, the

who is age 65 or older

depreciable life of the property is the same for federal and

state purposes. For the tax year in which the property is

Subtract line 2 from line 1. Enter this amount

placed in service, a taxpayer must add back the difference, in

on line q-1. Do not enter an amount less than

the line for other additions, between the depreciation

zero.

deduction allowed for federal purposes and the deduction that

would have been allowed without bonus depreciation.

Worksheet for Spouse line q-2:

Therefore, the South Carolina adjusted basis is greater than

the federal adjusted basis. For all other years of the

depreciable life of the property, an additional depreciation

Maximum deduction allowed for spouse

$15,000

deduction is available for South Carolina purposes.

Amount claimed on line p-2 for the taxpayer

If you itemized and claimed a federal tax credit for qualified

who is age 65 or older

mortgage credit certificates (MCC), you may subtract the

amount of the tax credit as interest.

Subtract line 2 from line 1. Enter this amount

South Carolina net operating loss that is larger than the

on line q-2. Do not enter an amount less than

federal amount is a subtraction. In no event is the same

zero.

loss to be deducted more than once. Attach your own

worksheet or keep with your tax records. No carryback losses

Line r - NEGATIVE AMOUNT OF FEDERAL TAXABLE

are allowed.

INCOME

Capital expenses amortized under federal statutes will be the

For the SC1040 form, it is important that a negative number not

same for state purposes. At the end of the federal

be entered on line 1. Because the South Carolina return begins

amortization, the balance of capital expense amortized will

with federal taxable income, it is important that you get the benefit

continue until fully amortized for state purposes. The

of the negative amount from the federal taxable income line of the

amortized amount is a subtraction from your income.

federal return. On the SC1040 form, start with zero on line 1 and

put the negative amount from the federal taxable income line of

Legislators within a 50-mile radius of the State House are

the federal return on this line of the SC1040.

allowed to subtract travel expenses.

Retirement income paid by the United States government for

Line s - SUBSISTENCE ALLOWANCE

service in the Reserves or National Guard is not taxed for

Police and all commissioned law enforcement officers paid by

South Carolina purposes.

(You may deduct the entire

South Carolina municipal, county, state governments or the

amount of any stipend paid by the State of South Carolina for

federal

government,

full-time

firefighters,

and

full-time

National Guard service.)

emergency medical service personnel are entitled to subsistence

Determine the percentage of your military retirement income

allowances of $8.00 per regular workday. Your employer should

which is excludable by dividing the length of time you served

provide you with the number of work days.

in the Reserves and/or National Guard (not full time) by the

Line t - DEPENDENTS UNDER SIX YEARS OF AGE

length of time of your total military service as follows:

An additional deduction is allowed for each dependent claimed on

MILITARY RETIREMENT EXCLUSION WORKSHEET

the federal income tax return who had not reached the age of six

by December 31 of the tax year. Birthdate(s) and Social Security

Inactive Reserve time

number(s) are required. See next column for exemption

+ Inactive National Guard time

% exclusion

worksheet.

Total Military time (Active and Inactive)

Determine the excludable amount of your military retirement

income by multiplying it by the percentage of exclusion as

follows:

total taxable military

excludable

retirement income

military

shown on federal

retirement

% exclusion X

return

income

Include the amount of excludable military retirement income as a

subtraction.

Instructions For Form Sc1040 - 2011 Page 5

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