Agricultural equipment tax credit
South Carolina offers an income tax credit for companies that purchase and install certain qualifying equipment, including conservation tillage equipment, drip/trickle irrigation systems and dual-purpose combination truck-and-crane equipment.
The credit equals 25% of qualifying expenditures, up to a maximum credit of $2,500 in a tax year. The credit may be particularly relevant to agribusiness operations investing in qualifying equipment.
Eligible equipment
The credit applies to qualifying expenditures for the purchase and installation of three types of equipment:
- Conservation tillage equipment: qualifying planters and drills designed to plant directly into an undisturbed seedbed
- Drip/trickle irrigation systems: qualifying low-pressure, low-volume irrigation systems that deliver water directly to the root zone or base of plants
- Dual-purpose combination truck-and-crane equipment: qualifying self-propelled machinery consisting of a crane mounted to a mobile chassis
Equipment must be purchased and installed during the taxable year to qualify.
Credit details
The credit equals 25% of qualifying expenditures, up to a maximum credit of $2,500 in a tax year. A company may claim the credit only once for each of the three qualifying measures.
Pass-through entities
For pass-through entities, the credit is determined at the entity level and is limited to $2,500.
Carryforward
Unused credits may be carried forward for up to five years.
Claiming the credit
The South Carolina Department of Revenue (SCDOR) administers the credit. Companies claim the credit using Form TC-1.
SCDOR identifies this credit as the Drip/Trickle Irrigation Systems Credit. Form TC-1 includes the requirements for conservation tillage equipment, drip/trickle irrigation systems and dual-purpose combination truck-and-crane equipment.
