What is South Carolina's tax credit for hiring formerly incarcerated individuals, who qualifies, and how much is it?

Plain-English summary

South Carolina Revenue Ruling #23-2 explains a state tax credit — created by Act No. 237 of 2022 and codified at S.C. Code Ann. § 12-6-3710 — for employers who hire a formerly incarcerated individual into a registered apprenticeship program. It is the companion to the veterans-hiring credit (RR #23-1); the mechanics are nearly identical, with a different eligibility test for the employee.

Who qualifies as a "formerly incarcerated individual." Someone who, within three years of the date of hire, was held in a South Carolina state or county prison, jail, or detention center for at least 90 consecutive days — either:

• for a nonviolent crime, or
• for a violent crime (only the crimes listed in S.C. Code Ann. § 16-1-60 — e.g., murder, criminal sexual conduct, kidnapping, armed robbery, carjacking, drug trafficking, burglary) for which the person received a sentence of 10 years or less or received a pardon.

Incarceration in a federal facility or in another state does not qualify — it must be a South Carolina state or county facility.

The hiring window. The individual must be hired as a new employee (not already employed by you before January 1, 2022) on or after January 1, 2022 and on or before December 31, 2026. The credit can still be claimed after 2026 on the same schedule for a qualifying hire made inside that window.

How much, and when it's earned. The credit is first earned in the tax year the employee completes 12 consecutive months of employment (partial months don't count):

• $3,000 at 12 consecutive months,
• $2,500 at 24 consecutive months, and
• $1,000 at 36 consecutive months —

so up to three years, each year capped at the employer's tax liability.

What taxes it offsets. Individual income tax (§ 12-6-510), corporate income tax (§ 12-6-530), corporate license (franchise) tax (Chapter 20, Title 12), bank tax (Chapter 11, Title 12), the savings-and-loan association tax (Chapter 13, Title 12), and insurance premium taxes (Chapter 7, Title 38 — which SCDOR notes it does not administer).

The limits that trip people up.

• Not refundable, and there is no carryforward — any credit above your liability in the earning year is forfeited.
• Once per individual, ever — regardless of employer; a second employer can't claim it again even if the first used only one or two years. Check status on MyDORWAY before relying on it.
• 12 consecutive months — an employee who quits and returns to total 12 months does not qualify (Q20). But a month of FMLA leave still counts, because the person remains employed (Q23).
• No leased/temp/PEO employees — only the employer's own employees (subject to its withholding) count; a previously leased worker later hired directly becomes a countable new employee (Q22).
• Half-time counts — two half-time apprentice-employees (each ≥20 hours/week) equal one full-time one under the Job Tax Credit definitions (§ 12-6-3360), but both must complete 12 consecutive months; you can't earn half a credit with a single half-time worker (Q21).

How to claim. The prospective hire completes Part A of Form I-64 (Pre-Screening for Formerly Incarcerated Apprenticeship Credit); the employer completes Part B after hiring. After the 12th consecutive month, update MyDORWAY (which issues a non-binding letter stating the amount) and report the credit on Schedule TC-64 with the return.

Stacking with other credits. Combinable with other credits such as the apprentice credit (§ 12-6-3477) and the Job Tax Credit (§ 12-6-3360). Chapter 6 credits may generally be applied in any order (§ 12-6-3480(3)); the ruling's three-year worked example shows it usually pays to apply the carryforward-eligible, liability-limited Job Tax Credit around the non-carryforward hiring and apprenticeship credits to avoid wasting them.

What this means for you

Employers and small-business owners

If you can hire through a DOL-registered apprenticeship, this credit is up to $6,500 per eligible worker over three years for giving a formerly incarcerated South Carolinian a start. Confirm the person was held in South Carolina for 90+ consecutive days within the last three years, and that any violent-crime history fits the § 16-1-60 + 10-years-or-less-or-pardon test. Run the I-64 pre-screen and check MyDORWAY so you're not chasing a credit another employer already claimed, and remember it won't carry forward — in a low-liability year some of it is lost.

Accountants and tax professionals

Same 12-consecutive-month clock, liability cap, and no-carryforward rules as the veterans credit — but watch the eligibility traps unique to this one: SC-only facilities, the 90-consecutive-day floor, the violent-crime/§ 16-1-60 carve-in, the leased-employee exclusion, and the consecutive (not cumulative) service rule. FMLA leave counts toward consecutive months. Use Form I-64 / Schedule TC-64 for this credit (the veterans credit uses I-65 / Schedule TC-65 instead), and confirm which return the credit offsets.

Everyone else

This is an employer hiring incentive tied to registered apprenticeships — it doesn't change sales tax, property tax, or an individual's own income tax outside the hiring context. Included here for completeness of South Carolina's advisory-opinion library.

Common questions

Q: Who is a "formerly incarcerated individual" for this credit?
A: Someone held in a South Carolina state or county prison, jail, or detention center for at least 90 consecutive days within three years of hire — for a nonviolent crime, or for a violent crime (per § 16-1-60) with a sentence of 10 years or less or a pardon. Federal or out-of-state incarceration doesn't qualify.

Q: How much is the credit and for how long?
A: Up to $3,000 (at 12 consecutive months), $2,500 (24 months), and $1,000 (36 months) — up to three years, each capped at your tax liability, only if the employee stays employed.

Q: Is it refundable or can I carry it forward?
A: Neither. It's nonrefundable with no carryforward; any amount over your liability in the earning year is forfeited.

Q: Does an employee who leaves and comes back qualify?
A: No. The 12 months must be consecutive; a separation and return to reach 12 total months does not qualify. But FMLA leave counts, because the person remains employed.

Q: Do leased or temp-agency workers count?
A: No. Only the employer's own employees (subject to its withholding) count. A previously leased worker later hired directly becomes a countable new employee.

Q: How do I claim it?
A: The prospective hire completes Part A of Form I-64; you complete Part B after hiring. After the 12th consecutive month, update MyDORWAY (which issues a non-binding letter) and report the credit on Schedule TC-64.

Citations and references

Statutes:

• S.C. Code Ann. § 12-6-3710 — the credit for hiring formerly incarcerated individuals (Act No. 237 of 2022): eligibility, $3,000/$2,500/$1,000 amounts, taxes offset, once-per-individual rule, no carryforward
• S.C. Code Ann. § 12-6-3710(H)(2) — definition of "formerly incarcerated individual" (SC facility, 90 consecutive days, violent/nonviolent distinction)
• S.C. Code Ann. § 16-1-60 — the list of "violent crimes" used by the definition
• S.C. Code Ann. § 12-6-3360 — Job Tax Credit; supplies the full-time (≥35 hrs) and half-time (≥20 hrs) job definitions
• S.C. Code Ann. § 12-6-3477 — apprentice income tax credit (combinable)
• S.C. Code Ann. § 12-6-3480(3) — Chapter 6 credits may generally be applied in any order
• S.C. Code Ann. § 12-6-510 (individual income tax) and § 12-6-530 (corporate income tax) — taxes the credit may offset

Also referenced: Forms I-64 and Schedule TC-64; MyDORWAY; the Family and Medical Leave Act (FMLA); Apprenticeship Carolina and the U.S. DOL Office of Apprenticeship. The full text of §§ 12-6-3710 and 16-1-60 is attached to the ruling as exhibits.

Source

• Landing page: SC Advisory Opinion Search
• Original PDF: RR23-2.pdf

Original ruling text

STATE OF SOUTH CAROLINA

DEPARTMENT OF REVENUE
300A Outlet Pointe Blvd., Columbia, South Carolina 29210
P.O. Box 125, Columbia, South Carolina 29214-0575

SC REVENUE RULING #23-2
SUBJECT:

South Carolina Income Tax Credit for Hiring Formerly Incarcerated
Individuals
(Income, Corporate License, and Bank Tax)

EFFECTIVE DATE: Tax years beginning after 2021
REFERENCES:

S.C. Code Ann. § 12-6-3710 (Act No. 237 of 2022) (enacted June 22, 2022)

AUTHORITY:

S.C. Code Ann. § 12-4-320 (2014)
SC Revenue Procedure #09-3

SCOPE:

The purpose of a Revenue Ruling is to provide guidance to the public. It is
an advisory opinion issued to apply principles of tax law to a set of facts
or general category of taxpayers. It is the Department’s position until
superseded or modified by a change in statute, regulation, court decision,
or another Department advisory opinion.

INTRODUCTION
S.C. Code Ann. § 12-6-3710 provides a tax credit for any taxpayer who hires a formerly
incarcerated individual after 2021 but before 2027 to participate in a registered apprenticeship
program certified by the United States Department of Labor. An employer may claim the credit
for up to three years if all statutory requirements are met. The amount of the credit for each eligible
employee is $3,000 for the first year of employment; $2,500 for the second year of employment;
and $1,000 for the third year of employment; but may not exceed the taxpayer’s liability for that
year.
The purpose of this advisory opinion is to provide an overview of and to address general questions
about this new South Carolina credit.
OVERVIEW OF THE FORMERLY INCARCERATED INDIVIDUAL TAX CREDIT
An employer who hires a formerly incarcerated individual as a new employee after 2021 to
participate in a registered apprenticeship program is eligible for this tax credit. The credit is first
earned in the year in which the formerly incarcerated individual completes his/her first 12
consecutive months of employment. A partial month does not count as a month. The amount of
the credit is $3,000 for the first year after the new employee remains employed for 12 consecutive
1

months. The credit amount changes to $2,500 for the tax year after the employee remains employed
for 24 consecutive months and to $1,000 for the tax year after the employee remains employed for
36 consecutive months. The credit is not available if the individual was an employee of the
employer prior to January 1, 2022.
The employer may only earn the credit for individuals hired on or prior to December 31, 2026,
although the credit may be claimed after that date on the same schedule and in the same amount
as provided in the statute. The credit may be used against individual income taxes, corporate
income taxes, corporate license taxes, bank franchise taxes, income taxes imposed on building and
loan associations, and insurance premium taxes.
For reference, S.C. Code Ann. § 12-6-3710 is attached.
QUESTIONS AND ANSWERS
PART 1 – FORMERLY INCARCERATED INDIVIDUAL

1. Q. Who is eligible for the credit?
   A. The credit is allowed for any employer that hires a formerly incarcerated individual for a
   registered apprenticeship program, as described in Question 6 below. A formerly
   incarcerated individual is someone who within three years of the date of hire was held in a
   South Carolina state or county prison, jail, or detention center for at least ninety
   consecutive days for a nonviolent crime; or for a violent crime for which he/she received a
   sentence of ten years or less or received a pardon. S.C. Code Ann. § 12-6-3710(H)(2).
2. Q. What is a violent crime?
   A. For purposes of this credit, only the crimes listed in S.C. Code Ann. § 16-1-60 are
   considered violent crimes. Some examples of violent crimes include murder, criminal
   sexual conduct, assault and battery with intent to kill, assault and battery of a high and
   aggravated nature, kidnapping, trafficking in persons, voluntary manslaughter, armed
   robbery, carjacking, drug trafficking, and burglary. A complete list is set forth in S.C. Code
   Ann. § 16-1-60, which is attached.
3. Q. Will hiring an individual who was incarcerated in a federal correctional facility or in a
   correctional facility in another state make an employer eligible for the tax credit?
   A. No. The employer must hire an individual who was held in a South Carolina state or county
   prison, jail, or detention center.
4. Q. What is the eligible hiring period for employers who want to earn the credit?
   A. An employer must hire formerly incarcerated individuals on or after January 1, 2022, and
   on or prior to December 31, 2026, to qualify for the credit.

2

5. Q. If an employer meets all the requirements and claims the credit, can a second employer
hire the same formerly incarcerated individual and claim the credit?
A. No. The credit may be claimed only once for an eligible employee, regardless of the
employer. See Question 11 below for instructions regarding how to determine if a previous
employer has claimed the credit. A second employer is ineligible to claim the credit even
if the first employer claimed the credit for only one or two years.
PART 2 – REGISTERED APPRENTICESHIP PROGRAM

6. Q. What is a “registered apprenticeship program that has been validated by the United States
   Department of Labor”?
   A. Registered apprenticeships are industry-vetted and approved programs with jobs that pay
   progressive wages as the employee’s skills and productivity increases. They provide
   structured on-the-job training, which includes instruction from an experienced mentor. For
   more information about registered apprenticeship programs, you may consult
   Apprenticeship Carolina (apprenticeshipcarolina.com), which is a division of the South
   Carolina Technical College System. For more information about the Department of
   Labor’s validation of apprenticeship programs, you may consult Apprenticeship USA
   (apprenticeship.gov) or the Department of Labor’s Office of Apprenticeship located at
   1835 Assembly Street in Columbia.
7. Q. Must the apprenticeship program last for three years in order for the employer to qualify
   for all three years of the tax credit?
   A. No. Credit qualification is determined annually based upon consecutive months of
   employment; it is not dependent on the length of the apprenticeship program itself. The
   appropriate term of the apprenticeship program should be determined by the employer with
   guidance from Apprenticeship Carolina and the Department of Labor.
8. Q: May an employee participate in an apprenticeship remotely?
   A: To earn the credit, an employer must hire a formerly incarcerated individual as a new
   employee in a registered apprenticeship program that has been validated by the Department
   of Labor. According to the Department of Labor’s website, “Apprenticeships produce
   skilled workers through a combination of on-the-job learning and classroom training
   (virtual or in-person).” Therefore, an employee could participate in part of the
   apprenticeship remotely. The apprenticeship program must be validated by the Department
   of Labor, so its standards control the extent to which the apprenticeship might be
   accomplished by virtual participation.
9. Q. Can an employer qualify for the credit with two half-time apprentice-employees instead of
   one full-time apprentice-employee?

3

A: Yes. Subsection (H) of S.C. Code Ann. § 12-6-3710 states that “full-time” has the same
meaning as provided in S.C. Code Ann. § 12-6-3360, the Job Tax Credit statute. The Job
Tax Credit states that two half-time jobs are considered one full-time job. S.C. Code Ann.
§ 12-6-3360(M)(4). A “half-time job” is a job requiring a minimum of twenty hours of an
employee's time a week for the entire normal year of the company's operations. A “fulltime job” is one that requires a minimum of thirty-five hours of an employee's time a week
for the entire normal year of company operations. Because two half-time employees equal
one full-time employee under the Job Tax Credit, two half-time apprentice-employees can
qualify for one full-time apprentice-employee under this credit. However, both apprenticeemployees who hold a half-time apprenticeship must be employed for 12 consecutive,
complete months before an employer will be eligible for the credit. In other words, if one
half-time employee was hired before the second half-time employee, the employer is not
eligible for the credit until the second employee has worked for 12 consecutive months.
PART 3 – HOW TO CLAIM THE CREDIT

10. Q. When does an employer become eligible for the credit?
    A. An employer becomes eligible for the credit in the tax year in which the new employee
    completes his/her twelfth consecutive month of employment. If there is a delay between
    the employment start date and the start date of the apprenticeship program, the employer
    still becomes eligible for the credit after the twelfth full month of employment provided
    the employee was newly hired into the apprenticeship program.
11. Q. How does an employer claim the credit?
    A. An employer can confirm the eligibility of a potential employee once the potential
    employee has completed Part A of the Pre-Screening for Formerly Incarcerated
    Apprenticeship Credit form (I-64). The employer can check the potential employee’s status
    on MyDORWAY at dor.sc.gov to confirm that no other employer has previously claimed
    the credit for this employee.
    If the employer hires the prospective employee, the employer should complete Part B of
    Form I-64.
    When an employee completes the twelfth consecutive month of employment, the employer
    should return to MyDORWAY and complete the information necessary to show he/she has
    fulfilled the credit’s requirements. The Department, through MyDORWAY, will then issue
    a letter to the employer explaining the amount of the credit based upon the information the
    employer provided. 1 The credit amounts for each eligible employee should be entered on
    the Formerly Incarcerated Apprenticeship Credit form (SC SCH.TC-64) and submitted
    with the employer’s tax return.
    The letter from MyDORWAY does not guarantee that the employer qualifies for the credit. See
    Question 12 for further discussion.

1

4

12. Q. If an employer receives the letter from the Department explaining the amount of the credit,
is the employer assured of getting the credit?
A. No. The letter from the Department, which is issued through MyDORWAY, is a statement
of the amount of the credit based on information provided by the employer. This letter is
not guaranteed approval of the credit. The statutory requirements must be met for the credit
to be properly claimed, and the employer is responsible for entering accurate information
into MyDORWAY.
PART 4 - OTHER ISSUES

13. Q. What is the amount of the credit?
    A. For each eligible formerly incarcerated individual still employed after 12 consecutive
    months, the employer will qualify for a credit of up to $3,000 for that employee for that
    tax year. If the formerly incarcerated individual is still employed after 24 months, the
    employer will qualify for a credit of up to $2,500 in the second tax year. If the formerly
    incarcerated individual is still employed after 36 months, the employer will qualify for a
    credit of up to $1,000 in the third tax year. The yearly aggregate amount of the credit is
    limited by the employer’s tax liability.
14. Q. Which taxes may be offset by this credit?
    A. The credit may be claimed against individual income tax (S.C. Code Ann. § 12-6-510),
    corporate income tax (S.C. Code Ann. § 12-6-530), corporate license tax (S.C. Code Ann.
    Chapter 20, Title 12), bank franchise tax (S.C. Code Ann. Chapter 11, Title 12), income
    tax imposed on building and loan associations (S.C. Code Ann. Chapter 13, Title 12), and
    insurance premium taxes (S.C. Code Ann. Chapter 7, Title 38) 2. S.C. Code Ann. § 12-63710(B).
15. Q. Are there limits on the amount of the credit?
    A. Yes. The aggregate amount of the credit for all eligible employees in a taxable year may
    not exceed the taxpayer’s tax liability for that year.
16. Q. Can unused credit amounts be carried forward?
    A. No. There is no carry forward provision for the credit, so any unused credit amounts may
    not be applied to a succeeding year’s liability. If the credit is not fully used in the applicable
    year, it is forfeited.
17. Q. How many years can an employer take the credit?
    A. Three. There is no credit after an employee’s third year of employment. The employer
    cannot take the credit in all three years unless the eligible employee remains employed for
    the entire period.
    2

SCDOR does not administer insurance premium taxes.
5

18. Q. Is the credit refundable?
A. No. The credit is not refundable.

19. Q. Can an employer claim the credit for hiring a formerly incarcerated individual and also
    claim other credits?
    A. Yes, an employer can claim the credit for hiring a formerly incarcerated individual and
    combine it with other credits if the employer meets the requirements for the additional
    credits. Unless otherwise provided in the particular credit statute, a taxpayer may apply
    Chapter 6 tax credits in any order. S.C. Code Ann. § 12-6-3480(3). 3
    Example
    Employer X is a taxpayer with a manufacturing facility in a multicounty industrial park in
    a Tier II County. Employee A is hired for a full-time job at X’s facility, starting with an
    apprenticeship program that was approved by the United States Department of Labor.
    Employee A begins employment on the first day of Year 1 and works for 36 consecutive
    months. Employee A qualifies as a formerly incarcerated individual so that Employer X is
    eligible for the tax credit for hiring formerly incarcerated individuals for an apprenticeship
    program (FII credit) pursuant to S.C. Code Ann. § 12-36-3710.
    Employee A’s employment also makes Employer X eligible for the apprentice income tax
    credit (Apprenticeship credit) equal to $1,000 a year for four years pursuant to S.C. Code
    Ann. § 12-6-3477. Additionally, in Year 1, by hiring Employee A, Employer X generates
    a traditional annual job tax credit (Job Tax credit) pursuant to S.C. Code Ann. § 12-63360(C)(1) equal to $3,750 ($2,750 plus an additional $1,000 credit because the facility is
    located in a multicounty industrial park). The Job Tax credit cannot be claimed until Year
    2 and is limited each year to 50% of tax liability. S.C. Code Ann. § 12-6-3360. In Year 2,
    Employer X generates another Job Tax credit equal to $3,750, which can be claimed in
    Year 3. The following chart reflects X’s tax liability for Year 1 through Year 3:
    Year 1
    $2,500
    3,000
    1,000
    0
    $0

Tax Liability
FII credit
Apprenticeship credit
Job Tax credit
Final Tax Liability

In Year 1, Employer X earns an FII credit equal to $3,000 and an Apprenticeship credit
equal to $1,000. Employer X’s tax liability is only $2,500, so the FII credit will reduce the

3

S.C. Code Ann. §§ 12-6-3477, 12-6-3710, and 12-6-3360 do not require taxpayers to apply
these credits in any particular order.
6

liability to $0. The remaining $500 of the FII credit and the $1,000 of the Apprenticeship
credit will be lost because they cannot be carried forward to the following year. 4
Year 2
$7,000
3,750
2,500
1,000
$0

Tax liability
Job Tax credit
FII credit
Apprenticeship credit
Final Tax Liability

In Year 2, it will benefit Employer X to apply the Job Tax credit first because it is limited
to 50% of the tax liability and unused amounts may also be carried forward. Applying
$3,500 of the available $3,750 Job Tax credit 5 reduces Employer X’s tax liability before
the FII credit and the Apprenticeship credit are applied from $7,000 to $3,500. The
remaining $250 of the Job Tax credit may be carried forward to Year 3. The $2,500 FII
credit and the $1,000 Apprenticeship credit can be applied in any order to reduce Employer
X’s final tax liability to $0.
Year 3
$12,000
1,000
1,000
4,000 (3,750 plus 250 carry
forward from Year 2)
$6,000

Tax Liability
FII credit
Apprenticeship credit
Job Tax credit
Final Tax Liability

In Year 3, the order of applying tax credits will not affect Employer X’s tax liability. The
FII credit of $1,000 and the Apprenticeship credit of $1,000 will reduce Employer X’s tax
liability to $10,000 and the limit for the Job Tax credit to $5,000, allowing all of the $4,000
Job Tax credit to be applied to reduce Employer X’s tax liability to $6,000. Alternatively,
Employer X could apply the $4,000 Job Tax credit first, reducing his or her tax liability to
$8,000, and then apply the FII credit of $1,000 and the Apprenticeship credit of $1,000 to
reduce Employer X’s tax liability to $6,000. However, because the Apprenticeship credit
and the FII credit cannot be carried forward, the taxpayer will usually benefit from applying
these credits first.

4

The example demonstrates that the FII credit is applied first, but the order of applying the
available tax credits will not affect Employer X’s tax liability for Year 1 because neither credit is
limited or able to be carried forward. If the Apprenticeship credit is applied first, Employer X’s
liability is reduced to $1,500. The $3,000 FII credit is then applied to reduce the remaining
liability to zero. The $1,500 of FII unused credit will be lost.
5
The Job Tax credit amount is limited to 50% of Employer X’s tax liability.
7

20. Q. If an employer hires a formerly incarcerated individual who works for less than one year
but returns to work after a separation in service and works for a total of one year, may the
employer claim the credit?
A. No. An employer may only claim the credit if the formerly incarcerated individual is a new
employee and works for twelve consecutive months.

21. Q. May an employer claim the credit if the formerly incarcerated individual begins his
    employment as a part-time employee but is then made a full-time employee?
    A: Yes, the employer may claim the credit. However, while a half-time employee, the
    formerly incarcerated individual may only be counted as half of an employee for purposes
    of this credit. The employer may only claim the credit if there is another half-time employee
    to pair with the first half-time employee. The statute does not allow an employer to earn
    half of the credit with one half-time employee. Additionally, the credit will not be earned
    until the new employee works in a full-time capacity for 12 consecutive months.
22. Q. Can an employer qualify for the credit with leased employees?
    A. No. Leased employees or other employees of another company who are on the payroll of
    that company, such as a temporary employment agency or professional employer
    organization, will not qualify as an employer for the FII credit. Only employees of the
    employer will count toward the credit (i.e., employees subject to withholding by the
    employer.) If, however, an employer subsequently hires employees who were previously
    leased, then they are considered new employees who can be counted toward the FII credit
    if all other statutory requirements are met.
23. Q. Can the employer qualify for the credit if the formerly incarcerated individual takes one
    month of leave during his first year of employment pursuant to the Family Medical Leave
    Act (FMLA)?
    A. Yes. Because the formerly incarcerated individual remains employed while he/she is on
    leave pursuant to FMLA, the month he/she is on leave will be counted toward the
    consecutive month requirement for the FII credit.
    SOUTH CAROLINA DEPARTMENT OF REVENUE

s/W. Hartley Powell
W. Hartley Powell, Director
August 14
,2023
Columbia, South Carolina

8

S.C. Code Ann. § 12-6-3710
Income tax credit for taxpayers that hire formerly incarcerated individuals; eligibility; regulations;
definitions.
(A)
For tax years beginning after 2021, there is allowed a tax credit for any taxpayer that
hires a formerly incarcerated individual, after 2021 but before 2027, as a new employee in a
registered apprenticeship program that has been validated by the United States Department of
Labor. An employer who has one or more eligible employees is eligible to apply for and receive
a credit against the taxes set forth in subsection (B). In the first year in which the credit is earned
pursuant to subsection (D), the amount of the credit is three thousand dollars for each eligible
employee. If the eligible employee remains employed and otherwise meets the requirements of
this section thereafter, the credit is two thousand five hundred dollars in the second year, and one
thousand dollars in the third year. The credit may not be claimed beyond the third year.
(B)
The credit allowed pursuant to this section may be taken against the income taxes
imposed pursuant to this chapter, the bank tax imposed pursuant to Chapter 11 of this title, the
savings and loan association tax imposed pursuant to Chapter 13 of this title, the corporate
license tax imposed pursuant to Chapter 20 of this title, and insurance premium taxes imposed
pursuant to Chapter 7, Title 38.
(C)
The total amount of the tax credit for a taxable year may not exceed the taxpayer's tax
liability. Any unused credit may not be carried over to apply to the taxpayer's succeeding year's
liability.
(D)

(1) The tax credit is earned in the year in which the formerly incarcerated individual first
completes the twelfth consecutive month of employment with the taxpayer. The credit is
earned in the same manner and on the same schedule in the second and third year of
employment.
(2) The tax credit allowed by this section only may be claimed for an eligible individual
once, regardless of the employer. The department shall consult with the Department of
Commerce, Apprenticeship Carolina of the South Carolina Technical College System,
and any other agency or entity necessary to establish a process by which employers are
aware of an individual's eligibility for the credit allowed by this section.

(E)
Notwithstanding any other provision of this section, the credit allowed by this section
only may be claimed if the formerly incarcerated individual is hired by the employer, after 2021
but before 2027, as a new employee in the registered apprenticeship program. If the individual is
hired before 2027, then the employer may claim the credit for each year the individual is eligible
and on the same schedule as provided in this section.
(F)
The department may prescribe forms and promulgate regulations necessary to implement
the provisions of this section, including requiring the necessary documentation to prove
eligibility.

9

(G)
Nothing in this section may be construed to allow an employer to claim this credit for a
formerly incarcerated individual if the individual was hired before 2022.
(H)

For purposes of this section:
(1) “Full-time” has the same meaning as provided in Section 12-6-3360.
(2) “Incarcerated individual” means an individual that, within three years of being hired
in a qualifying apprenticeship program, was held in a state or county prison, jail, or
detention center for at least ninety consecutive days, but does not include an individual
incarcerated for a violent crime set forth in Section 16-1-60, unless such individual
received a pardon for the offense or unless the only disqualifying violent crime resulted
in a sentence of ten years or less under Section 44-53-370(E) or Section 44-53-375(C).

10

S.C. Code Ann. § 16-1-60
Violent crimes defined.
For purposes of definition under South Carolina law, a violent crime includes the offenses of:
murder (Section 16-3-10); attempted murder (Section 16-3-29); assault and battery by mob, first
degree, resulting in death (Section 16-3-210(B)), criminal sexual conduct in the first and second
degree (Sections 16-3-652 and 16-3-653); criminal sexual conduct with minors, first, second, and
third degree (Section 16-3-655); assault with intent to commit criminal sexual conduct, first and
second degree (Section 16-3-656); assault and battery with intent to kill (Section 16-3-620); assault
and battery of a high and aggravated nature (Section 16-3-600(B)); kidnapping (Section 16-3-910);
trafficking in persons (Section 16-3-2020); voluntary manslaughter (Section 16-3-50); armed
robbery (Section 16-11-330(A)); attempted armed robbery (Section 16-11-330(B)); carjacking
(Section 16-3-1075); drug trafficking as defined in Section 44-53-370(e) or trafficking cocaine
base as defined in Section 44-53-375(C); manufacturing or trafficking methamphetamine as
defined in Section 44-53-375; arson in the first degree (Section 16-11-110(A)); arson in the second
degree (Section 16-11-110(B)); burglary in the first degree (Section 16-11-311); burglary in the
second degree (Section 16-11-312(B)); engaging a child for a sexual performance (Section 16-3810); homicide by child abuse (Section 16-3-85(A)(1)); aiding and abetting homicide by child
abuse (Section 16-3-85(A)(2)); inflicting great bodily injury upon a child (Section 16-3-95(A));
allowing great bodily injury to be inflicted upon a child (Section 16-3-95(B)); domestic violence
of a high and aggravated nature (Section 16-25-65); domestic violence in the first degree (Section
16-25-20(B)); abuse or neglect of a vulnerable adult resulting in death (Section 43-35-85(F));
abuse or neglect of a vulnerable adult resulting in great bodily injury (Section 43-35-85(E)); taking
of a hostage by an inmate (Section 24-13-450); detonating a destructive device upon the capitol
grounds resulting in death with malice (Section 10-11-325(B)(1)); spousal sexual battery (Section
16-3-615); producing, directing, or promoting sexual performance by a child (Section 16-3-820);
sexual exploitation of a minor first degree (Section 16-15-395); sexual exploitation of a minor
second degree (Section 16-15-405); promoting prostitution of a minor (Section 16-15-415);
participating in prostitution of a minor (Section 16-15-425); aggravated voyeurism (Section 1617-470(C)); detonating a destructive device resulting in death with malice (Section 16-23720(A)(1)); detonating a destructive device resulting in death without malice (Section 16-23720(A)(2)); boating under the influence resulting in death (Section 50-21-113(A)(2)); vessel
operator's failure to render assistance resulting in death (Section 50-21-130(A)(3)); damaging an
airport facility or removing equipment resulting in death (Section 55-1-30(3)); failure to stop when
signaled by a law enforcement vehicle resulting in death (Section 56-5-750(C)(2)); interference
with traffic-control devices, railroad signs, or signals resulting in death (Section 56-5-1030(B)(3));
hit and run resulting in death (Section 56-5-1210(A)(3)); felony driving under the influence or
felony driving with an unlawful alcohol concentration resulting in death (Section 56-52945(A)(2)); putting destructive or injurious materials on a highway resulting in death (Section
57-7-20(D)); obstruction of a railroad resulting in death (Section 58-17-4090); accessory before
the fact to commit any of the above offenses (Section 16-1-40); and attempt to commit any of the
above offenses (Section 16-1-80). Only those offenses specifically enumerated in this section are
considered violent offenses.

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