Who qualifies for South Carolina's Tuition Tax Credit, and how is the refundable credit calculated?

Plain-English summary

South Carolina Revenue Ruling #24-3 explains the refundable Tuition Tax Credit under § 12-6-3385. The credit equals 50% of qualifying tuition paid during the tax year, up to $1,500 per qualifying student per year. Because it is refundable, a taxpayer can receive the excess even when the credit exceeds South Carolina income tax liability. A return may claim the credit for more than one qualifying student, but a separate Form I-319 is required for each student.

A qualifying student must meet all of the ruling's conditions. The student must be admitted and enrolled as a degree-seeking undergraduate or in a certificate or diploma program lasting at least one year, qualify for in-state tuition, be in good standing, complete the required credit hours, and enroll at a qualifying institution within 12 months after the specified South Carolina high-school or home-school completion. A qualifying out-of-state preparatory-school graduate can also meet the rule when the student was a dependent of a South Carolina resident parent or guardian with custody.

The credit generally covers only four consecutive years beginning when the student first starts classes at a qualifying institution. A break from school does not pause that period unless the ruling's medical-necessity or active-duty military exception applies. Graduate students do not qualify. The ruling also excludes GED recipients, Palmetto Fellows and LIFE Scholarship recipients, certain students in loan default or owing aid refunds, and students with specified felony, alcohol, or drug adjudications, convictions, or pleas.

Qualifying tuition includes tuition and required enrollment fees, reduced by scholarships and grants paid toward tuition. Optional charges for books, particular courses, housing, meal plans, parking, or athletics do not count. Student loans, employer educational assistance, and § 529 plan funds do not reduce tuition. For an independent institution, qualifying tuition is capped at the lesser of actual tuition or the average tuition at South Carolina's four-year public institutions.

What this means for you

Students and families

Check the current year's Form I-319 instructions to confirm that the school qualifies. Enrollment means the date classes begin, not acceptance or payment. A gap year is possible only if classes at the qualifying institution begin within the 12-month deadline.

Track completed hours by calendar tax year. A student attending both spring and fall generally must complete at least 30 credit hours. A student attending only one fall or spring semester generally needs the Commission on Higher Education's 15-hour equivalent; Converse and Wofford use a 12-hour one-semester equivalent. Disability-based equivalents may be documented on Form CHE-400.

Parents and other tuition payers

The person who actually paid tuition claims the credit. That may be the student or someone entitled to claim the student as a federal dependent. If both pay, the credit is allocated according to each person's share of tuition paid, and the combined credit for the student remains capped at 50% of qualifying tuition and $1,500.

Return preparers

Use the year-specific Form I-319 and attach it to Form SC1040. Tuition is counted when paid, including permitted prepayments for a later semester. Reduce tuition only by scholarships and grants actually applied to tuition, not by loans, employer assistance, or § 529 funds.

Common questions

Q: Is the credit refundable?
A: Yes. A taxpayer with no South Carolina income tax liability may still receive a refund equal to the allowed credit.

Q: Can LIFE or Palmetto Fellows recipients claim it?
A: Not while receiving those scholarships. A student who later loses the scholarship may qualify for semesters without it if all other requirements are met. A qualifying HOPE Scholarship recipient is not excluded on that basis.

Q: Do online, study-abroad, internship, or co-op hours count?
A: They can. Online courses must count toward the degree; study-abroad, internship, and co-op hours must be approved and accepted for credit by the qualifying South Carolina institution.

Q: Do dropped classes count toward the hour requirement?
A: No. The course must be completed, though the ruling states no minimum grade is required for a completed course to count.

Q: Do dual-enrollment or AP hours earned before high-school graduation count?
A: No. The ruling also excludes IB hours and hours earned in the summer immediately after high-school graduation from the credit-hour calculation.

Citations and references

• S.C. Code Ann. § 12-6-3385 — Tuition Tax Credit
• S.C. Code Ann. § 59-103-5 — state-supported post-secondary institutions
• S.C. Code Ann. § 59-113-50 — qualifying independent institutions
• S.C. Regulations §§ 62-1200.5 and 62-310 — preparatory-high-school definition cited by the ruling

Source

• Landing page: SC Advisory Opinion Search
• Original PDF: RR24-3.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 #24-3

SUBJECT:

Tuition Tax Credit
(Income Tax)

EFFECTIVE DATE:

Applies to all periods open under the statute.

SUPERSEDES:

S.C. Revenue Ruling #09-3

REFERENCES:

S.C. Code Ann. § 12-6-3385

AUTHORITY:

S.C. Code Ann. § 12-4-320
S.C. Code Ann. § 1-23-10(4)
S.C. 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.

S.C. Code Ann. § 12-6-3385 provides for a refundable individual income tax credit for tuition paid
to an institution of higher learning, or other designated institution, during the tax year. To qualify
for the credit, students must meet the requirements found in the credit statute.
This advisory opinion provides answers to common questions about the Tuition Tax Credit.
I. General Credit Questions

1. Is the Tuition Tax Credit a refundable tax credit?
   Yes, the Tuition Tax Credit is a refundable tax credit. A refundable tax credit directly
   reduces income tax liability, and if the amount of the credit is greater than the amount of
   tax owed, the difference is refunded to the taxpayer. Taxpayers with zero South Carolina
   tax liability may take a refundable tax credit and receive a refund equal to the credit
   amount.

1

2. What is the credit amount?
The credit is 50% of the qualifying tuition 1 paid during the tax year, up to a maximum
credit amount of $1,500 per year. The maximum credit amount is the same for both twoyear and four-year institutions 2.
Tuition paid in a tax year may include amounts paid for the spring and fall semesters,
summer and interim terms, and pre-payments for the spring semester of the next tax year.

3. How is the credit claimed?
   Use Form I-319 to claim the credit. This form must be attached to the South Carolina
   individual income tax return (SC1040). The I-319 is a year-specific form, so taxpayers
   must use the correct version for the tax year in which the credit is claimed.
4. Can the credit be claimed for more than one qualifying student 3 on a single income
   tax return?
   Yes. In some situations, tuition is paid for more than one qualifying individual included on
   a single income tax return. For example, a person may have multiple dependents who are
   qualifying students, or spouses filing jointly may both be qualifying students. The Tuition
   Tax Credit can be claimed for each qualifying student. A separate Form I-319 should be
   completed and attached for each student claiming the credit.
   II. Qualifying Institutions
5. Which institutions (or schools) qualify for the credit?
   Qualifying institutions are institutions of higher learning or designated institutions,
   including:
6. Any South Carolina state-supported post-secondary educational institution,
   including technical and comprehensive educational institutions; 4
7. An independent eleemosynary junior or senior college in South Carolina whose
   major campus and headquarters are located within South Carolina and which is
   accredited by the Southern Association of Colleges and Secondary Schools; 5

Qualifying tuition is discussed in Section IV, Tuition and Limits.
2017 Act No. 40, Section 18.A increased the credit amount for two-year and four-year institutions. Prior to this
increase, the maximum credit was $350 for two-year institutions and $850 for four-year institutions.
3
Qualifying student is discussed in Section III, Qualifying Students.
4
S.C. Code Ann. § 59-103-5
5
S.C. Code Ann. § 59-113-50(1)
1
2

2

3. A public or independent bachelor’s level institution chartered before 1962 whose
major campus and headquarters are located in South Carolina; 6

4. An independent bachelor’s level institution which has I.R.C. § 501(c)(3) tax status
   and is accredited by the Southern Association of Colleges and Secondary Schools;
   and
5. A public or independent two-year institution which has I.R.C. § 501(c)(3) tax
   status.
   The following chart lists the South Carolina schools that currently qualify for the credit.
   The Form I-319 instructions for a specific tax year will also list the schools that qualify in
   that tax year.
   4-year Public Institutions
   Citadel
   Clemson University
   Coastal Carolina University
   College of Charleston
   Francis Marion University
   Lander University
   Medical University of SC
   SC State University
   University of South Carolina
   USC Aiken
   USC Beaufort
   USC Upstate
   Winthrop University

Independent Institutions
Allen University
Anderson University
Benedict College
Bob Jones University
Charleston Southern University
Claflin University
Clinton College
Coker College
Columbia College
Columbia International
University
Converse College
Erskine College
Furman University
Limestone College
Morris College
Newberry College
North Greenville University
Presbyterian College
Southern Wesleyan University
Spartanburg Methodist College
Voorhees University
Wofford College

2-year Public Institutions
Aiken Technical College
Central Carolina Technical
College
Denmark Technical College
Florence-Darlington Technical
College
Greenville Technical College
Horry-Georgetown Technical
College
Midlands Technical College
Northeastern Technical College
Orangeburg-Calhoun Technical
College
Piedmont Technical College
Spartanburg Community College
Technical College of the
Lowcountry
Tri-County Technical College
Trident Technical College
USC Lancaster
USC Salkehatchie
USC Sumter
USC Union
Williamsburg Technical College
York Technical College

6. Which institutions do not qualify for the credit?
   Institutions whose sole purpose is religious or theological training or granting professional
   degrees, or whose main campus or headquarters is not in South Carolina, are not qualifying
   institutions for purposes of the credit.

6

S.C. Code Ann. § 59-113-50(2)

3

III. Qualifying Students

7. Who is a qualifying student?
   To qualify for the Tuition Tax Credit, a student must meet all of the following
   requirements:
8. Be admitted, enrolled, and classified as a degree seeking undergraduate or enrolled
   in a certificate or diploma program of at least one year;
9. Be eligible for in-state tuition;
10. Be in good standing at the institution; 7
11. Have completed at least 30 credit hours, or its equivalent, during the tax year 8; and
12. Enroll within 12 months of graduating from a South Carolina high school,
    completing a home school program in South Carolina, or graduating from a
    preparatory high school outside of South Carolina while a dependent of a parent or
    guardian who is a legal resident of South Carolina and has custody of the dependent
    student.
13. Who is not a qualifying student?
    The credit is not available to a student who:
14. Obtained a GED rather than a high school diploma;
15. Is a Palmetto Fellowship (Palmetto Fellows Scholarship) recipient;
16. Is a LIFE Scholarship recipient 9;
17. Is in default of a federal Title IV or South Carolina educational loan or owes a
    refund on a federal Title IV or South Carolina student financial aid program; or
18. Has been adjudicated delinquent, or convicted, pled guilty, or pled nolo contendere
    to any felonies or any alcohol or drug related offenses.
    Note: A student who has been adjudicated delinquent, or convicted, or pled guilty
    or nolo contendere to an alcohol or drug related misdemeanor offense is only
    ineligible for the tax year in which the adjudication, conviction, or plea occurred.

For more information about the requirements to be in good standing at the institution, see Question 10.
Credit hours and equivalents are discussed in Section V, Credit Hour Requirements.
9
The SC HOPE Scholarship is a merit-based scholarship for eligible freshmen who did not qualify for the LIFE or
Palmetto Fellows Scholarship. Students who receive the HOPE Scholarship are able to qualify for the Tuition Tax
Credit if they meet the other requirements to be a qualifying student.
7
8

4

9. Can a student who is not currently a qualifying student later qualify for the credit?
Yes. For example, a student who is currently a Palmetto Fellows or LIFE scholarship
recipient but later loses the scholarship may qualify for the credit in semesters the student
does not receive the scholarship. 10 A student who is in default on a student loan or owes a
refund on a student financial aid program may qualify for the credit after the loan or refund
has been repaid. A student who was adjudicated delinquent, convicted, or pled guilty or
nolo contendere to an offense may qualify for the credit once the student’s record is
expunged.

10. What does it mean to be in good standing at the institution? Are there minimum grade
    requirements?
    Students must be in good standing at the institution attended to be able to qualify for the
    credit. Each institution establishes minimum grade requirements and other criteria for
    evaluating whether a student is considered to be in good standing.
    Additionally, students must complete at least 30 credit hours, or its equivalent, during the
    tax year to qualify for the credit. There is no minimum grade required for a course to count
    toward these hours for purposes of the credit, but if the student withdraws from a course or
    otherwise does not complete it, the hours related to that course will not count toward the
    total credit hour requirement.
11. Do students enrolled in graduate degree programs qualify for the credit?
    No. Qualifying students must be degree-seeking undergraduates or in a certificate or
    diploma program of at least one year. This includes students enrolled in programs at
    qualified institutions 11 that lead to associates degrees or bachelor’s degrees (degreeseeking undergraduates) as well as those in other approved non-degree programs at
    qualified institutions which prepare students for gainful employment in recognized
    occupations and lead to recognized credentials (certificate or diploma programs). Students
    enrolled in a program for a masters or doctoral degree are not qualifying students for the
    Tuition Tax Credit.
12. Can a student who did not graduate from a South Carolina high school or home
    school claim the credit?
    Yes, provided the student graduates from a preparatory high school outside of South
    Carolina while a dependent of a parent or guardian who is a legal resident of South Carolina
    and has custody of the dependent.
    ‘Preparatory high school’ is not defined in S.C. Code Ann. § 12-6-3385, but regulations
    providing program definitions for purposes of the LIFE and Palmetto Fellows Scholarships

Students who are Palmetto Fellows or LIFE Scholarship recipients for both the Spring and Fall semesters in a tax
year do not qualify for the Tuition Tax Credit during the summer term of that tax year.
11
Qualifying institutions are discussed in Section II, Qualifying Institutions.
10

5

define a ‘preparatory high school’ as “a (public or private) school recognized by the state
in which the school is located to offer curricula through the twelfth grade and prepares
students for college entrance.” 12
Based on these definitions, a student who graduates from a public or private school 13 in
another state will qualify for the Tuition Tax Credit if:

1. The school is recognized by the state in which it is located to offer curricula through
   twelfth grade;
2. The school prepares students for college entrance; and
3. At graduation, the student was the dependent of a parent or guardian who was a
   legal resident of South Carolina and had custody of the student.
4. Can a student who takes a “gap year” after high school graduation qualify for the
   credit?
   Students must enroll in a qualifying institution within 12 months of graduating from high
   school or completing a home school program. Students may take a break between high
   school graduation and college enrollment, but college enrollment must be within 12 months
   of high school graduation for the student to qualify for the credit.
   For example, a student who graduates from high school on May 21, 2021 must be enrolled
   in a qualifying South Carolina institution by May 20, 2022 to be able to qualify for the
   credit. A student is considered enrolled on the date the student begins attending classes –
   not the date the student is accepted into the institution or pays tuition or a deposit.
5. Can a student who begins at a non-qualifying institution claim the credit after
   transferring to a qualifying South Carolina institution?
   Students must enroll in a qualifying institution within 12 months of graduating from high
   school or completing a home school program. Students who first attend a non-qualifying
   institution must transfer and be enrolled full-time at a qualifying institution within 12
   months of high school graduation to qualify for the credit.
   For example, a student who graduates from high school on May 21, 2021 and enrolls at a
   college in another state in the Fall 2021 semester must be enrolled full-time in a qualifying
   South Carolina institution by May 20, 2022 to be able to qualify for the credit. A student
   is considered enrolled on the date the student begins attending classes – not the date the
   student is accepted into the institution or pays tuition or a deposit.

12
13

S.C. Regulation §§ 62-1200.5 and 62-310
A home school program in another state will also qualify if it meets these requirements.

6

15. How many years can a student qualify for the credit?
Generally, credits may only be claimed for four consecutive years beginning when the
student first enrolls in a qualifying institution.
A student first enrolls in a qualifying institution on the date the student begins attending
classes at the institution - not the date the student is accepted into the institution or pays
the tuition or deposit.
There are two exceptions to the general rule.

1. Medical Exception: The credit period may be extended due to medical necessity as
   defined by the Commission on Higher Education. Students with questions
   concerning medical necessity should contact their institution’s Office of Disability
   Services. A student claiming a medical exception to the four-year rule must provide
   a completed CHE-400, found at dor.sc.gov/forms, or other supporting
   documentation for the medical necessity.
2. Military Exception: The credit period may be suspended if a student is required to
   withdraw to serve on active military duty and subsequently re-enrolls in an eligible
   institution within 12 months upon demobilization. The student must provide
   official documentation from the Armed Forces to verify the dates of active duty
   military service.
   Examples
   The following chart of examples shows the tax years the credit may be claimed based on
   when tuition was paid 14 and the semesters attended at a qualifying school. Unless otherwise
   stated, the examples assume the students are qualifying students who graduated from a
   South Carolina high school in May 2021 and accumulated 30 credit hours (or the
   equivalent) during the tax year. Fall semester classes run from August 18 through
   December 15, and Spring semester classes run from January 7 through May 12.
   Tax Years Tuition Paid
   Tax
   Year

Student A

Student B

Student C

Student D

2021

Fall 2021

2021

2021

2021

Did not attend

2022

Spring 2022

2022

2021

Withdraws

Did not attend

Fall 2022

2022

2022

Did not attend

2022

Spring 2023

2023

2022

2023

2023

Fall 2023

2023

2023

2023

2023

2023

14

School
Semester

The credit amount is based tuition paid during the tax year. See Section IV, Tuition and Limits.

7

Tax Years Tuition Paid
Tax
Year
2024

2025

2026

School
Semester

Student A

Student B

Student C

Student D

Spring 2024

2024

2023

2024

2024

Fall 2024

2024

2024

2024

2024

Spring 2025

2025

2024

2025

2025

Fall 2025

N/A

N/A

2025

2025

Spring 2026

N/A

N/A

2026

2026

Fall 2026

N/A

N/A

2026

2026

Student A enrolled in Fall 2021 (within one year of graduating from high school) and may
claim the credit for four consecutive years after enrolling. Based on the initial enrollment
date, Student A’s eligible four-year credit period runs from August 18, 2021 through
August 17, 2025. Student A may claim the credit for tuition payments made in tax years
2021, 2022, 2023, 2024, and 2025.
Student B enrolled in Fall 2021 (within one year of graduating from high school) and may
claim the credit for four consecutive years after enrolling. Based on the initial enrollment
date, Student B’s eligible four-year credit period runs from August 18, 2021 through
August 17, 2025. Student B may claim the credit for tuition payments made in tax years
2021, 2022, 2023, and 2024. Student B attended college in 2025, but cannot claim the credit
in the 2025 tax year because no tuition payments were made during the year.
Student C enrolled in Fall 2021 (within one year of graduating from high school). Based
on the initial enrollment date, the eligible four-year credit period runs from August 18,
2021 through August 17, 2025. After attending for one semester, Student C withdrew from
school for all of 2022, and did not have a medical necessity or active duty military
exception. Student C resumed school attendance in 2023 and continued as a student
through 2026. Student C may claim the credit for all tuition payments made in 2021, 2023,
and 2024. For 2025, Student C may only claim the credit for tuition payments made for
semesters ending before August 17, 2025 (i.e., the Spring 2025 semester). The payment for
the Fall 2025 semester will not count for the credit. Student C cannot claim the credit in
2022 because no tuition payments were made during the year. In addition, the four-year
credit period is not suspended or extended for the two 2022 semesters that Student C did
not attend school; they are still counted toward the four consecutive years after enrolling.
Student D enrolled in Fall 2022 (August 18, 2022), so Student D did not enroll at a
qualifying school within twelve months of graduating from high school. A student who
graduates from high school in May 2021 would need to enroll in a qualifying school by
May 2022 in order to be able to take the credit in any future year. Student D is not a
qualifying student and cannot take the credit for any year.
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IV. Tuition and Limits

16. What qualifies as tuition for purposes of calculating the credit?
    Tuition means the amount charged, including required fees, necessary for enrollment.
    Required fees are fixed sums charged to students for items not covered by tuition and are
    required of such a large proportion of all students that the student who does not pay is an
    exception. Examples of required fees include technology fees and general fees.
    Examples of fees that are not required fees and are not included in the tuition amount used
    to calculate the credit include nonmandatory fees for athletics, books, specific courses,
    housing, meal plans, and parking.
    Scholarship grants received towards tuition are not considered to be tuition paid by the
    student and must be deducted from tuition before calculating the credit. 15
    Independent Institutions
    For purposes of calculating the credit, tuition at an independent institution is limited to the
    lesser of the average tuition at the four-year public institutions of higher learning 16 or the
    actual tuition charged.
    Students attending nontraditional semester schools (Converse College or Wofford College)
    must prorate the tuition limit using the following full-time equivalent hours:
    Institution

Fall and Spring

Interim/Other

Converse

12 hours

6 hours

Wofford

12 hours

4 hours

Students attending both the Fall and Spring semesters at Converse or Wofford must earn
30 hours total during the tax year to qualify for the Tuition Tax Credit.
For students attending the summer session at an independent institution, the amount of
tuition allowed is determined by multiplying the average tuition of the four-year public
institutions of higher learning by a fraction. The numerator of this fraction is the actual
number of summer school hours completed, and the denominator is the 30 hours required
to qualify for the credit. See Example 3 below.

See Question 17 for more information on determining which scholarship grants reduce eligible tuition for
purposes of the credit.
16
Refer to the I-319 instructions each year for the average tuition at the four-year public institutions.
15

9

Examples
The following examples illustrate how students attending public institutions or independent
institutions determine tuition for the purpose of calculating the credit. These examples
assume tuition was paid by the qualifying student during the tax year.
Example 1. Assume tuition is paid for one semester during the 2021 tax year.
Credit Computation

Student A - Public Institution

Student B - Independent
Institution*

Tuition
charged
for
semester during tax year

$5,500

$14,000

Required enrollment fees

$200

$200

Total qualified tuition and
fees (*not to exceed
$12,268 per year or
$6,134 per semester for
independent institutions
in 2021 – tuition limits
can be found in the Form
I-319 instructions for the
tax year)

$5,700

$6,134*

Scholarship
(applied
toward tuition payment)

$2,000

$3,000

SC Tuition and Pell
Grants (applied toward
tuition payment)

$500

$500

Less: Total scholarship
grants received during the
tax year

($2,500)

($3,500)

Tuition qualifying for the
credit

$3,200

$2,634

Tuition Tax Credit (50%
of qualifying tuition paid,
not to exceed $1,500 per
tax year)

$1,500

$1,317

Student A attends a public institution and is charged tuition and required fees totaling
$5,700. For purposes of the credit, tuition is reduced by $2,500 in scholarships and grants
received towards tuition.
The total qualifying tuition is $3,200. However, since the credit is limited to 50% of the
qualifying tuition, up to a maximum of $1,500, Student A’s Tuition Tax Credit amount is
$1,500.
10

Student B attends an independent institution and is charged tuition and required fees
totaling $14,200. For independent institutions, qualifying tuition is limited to the lesser of
the average tuition at the four-year public institutions ($6,134 per semester in 2021) or the
actual tuition charged ($14,200). For purposes of the credit, Student B’s tuition is further
reduced by $3,500 in scholarships and grants received towards tuition.
The total qualifying tuition is $2,634. However, since the credit amount is limited to 50%
of the qualifying tuition, up to a maximum of $1,500, Student B’s Tuition Tax Credit
amount is $1,317.
Example 2. Assume the qualifying student attends Converse College (an independent
institution) for the required equivalent hours (6 hours in the January term and 12 hours in
the Spring semester) and paid tuition during the 2021 tax year for the January term and the
Spring semester.
Credit Computation
Tuition charged
during tax year

for

term

January 2021

Spring 2021

Total

$5,400

$11,000

$16,400

Required enrollment fees

$50

$150

$200

Total qualified tuition and fees
(*not to exceed $12,268
tuition limit for independent
institutions prorated based on
equivalent hours attended
divided by 30 total hours)

$2,454*

$4,907*

$7,361

Less: Total scholarship grants
received during the tax year

($0)

($0)

($0)

Tuition qualifying for the
credit

$2,454

$4,907

$7,361

Tuition Tax Credit (50% of
qualifying tuition paid, not to
exceed $1,500 per tax year)

$1,500

The qualified student attends an independent institution and is charged tuition and required
fees totaling $16,400 during the tax year. For independent institutions, qualifying tuition is
limited to the lesser of the average tuition at the four-year public institutions ($7,361 in
2021 based on a pro-ration for equivalent hours attended) or the actual tuition charged
($16,400). The student did not receive any scholarships and grants towards tuition.
The total qualifying tuition is $7,361. However, since the credit amount is limited to 50%
of the qualifying tuition, up to a maximum of $1,500, the student’s tuition tax credit amount
is $1,500.

11

Example 3. Assume tuition is paid for 6 credit hours of summer school tuition during the
2021 tax year. The students also attended the Spring and Fall semesters at qualifying
institutions, for a total of 30 credit hours during the tax year. The credit in this example is
computed assuming the students did not pay additional tuition during the 2021 tax year for
the Spring or Fall semesters.
Credit Computation

Student A - Public Institution

Student B - Independent Institution*

Tuition
charged
for
summer session during tax
year

$2,000

$5,000

Required enrollment fees

$100

$100

Total qualified tuition and
fees (*not to exceed
$12,268 tuition limit for
independent institutions
multiplied by fraction
equal to 6 summer hours
divided by 30 total hours)

$2,100

$2,454*

Less: Total scholarship
grants received during the
summer session

($0)

($0)

Tuition qualifying for the
credit

$2,100

$2,454

Tuition Tax Credit (50%
of qualifying tuition paid,
not to exceed $1,500 per
tax year)

$1,050

$1,227

Student A attends a public institution and is charged tuition and required fees totaling
$2,100. The student did not receive any scholarships and grants towards tuition.
The total qualifying tuition is $2,100. However, since the credit is limited to 50% of the
qualifying tuition, up to a maximum of $1,500, Student A’s Tuition Tax Credit amount is
$1,050.
Student B attends an independent institution and is charged tuition and required fees
totaling $5,100. For independent institutions, qualifying tuition is limited to the lesser of
the average tuition at the four-year public institutions for the total equivalent hours, or the
actual tuition charged. The student did not receive any scholarships and grants towards
tuition.
The total qualifying tuition is $2,454. However, since the credit amount is limited to 50%
of the qualifying tuition, up to a maximum of $1,500, Student B’s Tuition Tax Credit
amount is $1,227.
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17. Which scholarship grants reduce tuition?
Before calculating the credit, reduce tuition by all scholarships and grants that were
received toward paying tuition. This includes athletic scholarships, academic scholarships,
need-based scholarships, Pell Grants, and South Carolina tuition grants. See Question 16,
Example 1 above for an illustration of the tuition calculation reduced by scholarships and
grants.
Scholarships and grants that were not received and paid toward tuition, such as scholarships
that were exclusively awarded for room and board, are not required to be deducted from
tuition.

18. Do other external funds, such as student loans, reduce tuition?
    No. Do not reduce tuition by amounts received from student loans, employer-provided
    educational assistance programs, or I.R.C. § 529 plans. These amounts are considered
    tuition paid by the student.
19. Who claims the credit, the parent or the student?
    The credit is claimed by the individual who actually paid the tuition during the tax year.
    This may be the student, or a parent or other individual eligible to claim the student as a
    dependent on his or her federal income tax return.
    If tuition was paid in part by both the student and another person who claims the student
    as a dependent, the credit amount is allocated between the two individuals based on the
    percentage of tuition paid by each. The total yearly credit claimed for a student cannot
    exceed 50% of qualified tuition, up to a maximum credit amount of $1,500.
    Examples
    The following chart of examples shows who can claim the credit, and in what amounts, in
    certain situations. Assume each student is a qualifying student attending a four-year
    public institution during the 2021 tax year and meeting all credit hour requirements.
    Tuition is paid during the 2021 tax year.
    Credit Calculation

Student A

Student B

Student C

Total Tuition

$11,000

$11,000

$11,000

Tuition Payments

$11,000 (paid directly
to school by check from
Parent A)

$11,000
(paid
by
student loans taken out
by Student B)

$7,000 (paid using
funds from Student C’s
529 plan)
$4,000 (paid directly to
school by Parent C)

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Credit Calculation
Tuition Tax Credit (50%
of qualifying tuition
paid, not to exceed
$1,500 per tax year)

Student A

Student B

Student C

$1,500

$1,500

$955

Claimed by Parent A

Claimed by Student B

Claimed by Student C 17

$545
Claimed by Parent C 18

20. When must tuition be paid to qualify for the credit in a particular tax year?
    The credit is based on tuition paid during the tax year. This includes tuition amounts paid
    during a tax year for the spring and fall semesters, summer and interim terms, and prepayments for another tax year.
    V. Credit Hour Requirements
21. What credit hours are used to qualify for the Tuition Tax Credit?
    Students must complete at least 30 credit hours, or its equivalent, during the tax year to
    qualify for the credit. The Commission on Higher Education (CHE) determines equivalent
    semester hours in accordance with S.C. Code Ann. § 12-6-3385.
    Students who attend school for both the Spring and Fall semesters in a tax year must
    complete at least 30 credit hours. The CHE has authorized that the semester hour equivalent
    for a student who is only attending one semester (Fall or Spring) during the tax year is 15
    credit hours, with the exception of students attending Converse or Wofford, where the
    semester hour equivalent for one semester is 12 credit hours. 19
    Note: Students with disabilities may have different semester hour
    equivalents as determined by the Commission on Higher Education.
    Contact the disability services provider at the institution of
    attendance. Complete the CHE-400, available at dor.sc.gov/forms,
    to certify the semester hour equivalent for the student.
    The CHE has determined that credits taken during summer and interim terms count toward
    the 30 credit hours during the tax year if the student attends school for both the Fall and
    Spring semesters. If the student only attends school for one semester (Fall or Spring), the
    CHE has determined that the summer or interim hours do not count toward the equivalent
    hours total.
    $1,500 maximum credit multiplied by percentage of tuition paid by the student ($7,000/$11,000).
    $1,500 maximum credit multiplied by percentage of tuition paid by the parent ($4,000/$11,000).
    19
    See the chart in Question 16 with equivalent hours for Converse and Wofford.
    17
    18

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Credit hours do not include hours earned before high school graduation, including dual
enrollment hours, Advanced Placement (AP) credit hours, or International Baccalaureate
(IB) credit hours. Credit hours also do not include hours earned in the summer term
immediately following high school graduation. Summer term enrollment is not a full-time
semester of enrollment, so does not start the four-year period for claiming the credit. Only
those credit hours earned after the qualifying student is enrolled in a qualifying program
will be counted for the Tuition Tax Credit 20.
Examples
The following chart of examples shows the hours each student completed during the tax
years and how those hours are determined to meet the credit requirements.
Assume the following facts (unless stated otherwise in the chart). The students are
qualifying students who graduated from high school in May 2021 and enrolled at a
qualifying school within one year of graduating from high school. Fall semester classes run
August 18 through December 15, and spring semester classes run January 7 through May

12. Tuition is paid in the same year as the semester attended (not pre-paid).
    Semesters Enrolled
    Fall 2021

Student A
15 hrs

Student B

Student C

(completes 6 hrs at 2yr
school in summer
2021)

(enters with 9 hours from high
school AP courses)

12 hrs

20

12 hrs

Spring 2022

15 hrs

12 hrs

12 hrs

Summer 2022

0 hrs

3 hrs

3 hrs

Fall 2022

15 hrs

12 hrs

N/A (student withdraws)

Spring 2023

15 hrs

12 hrs

N/A (student withdrawn)

Summer 2023

0 hrs

6 hrs

6 hrs

Fall 2023

15 hrs

12 hrs

15 hrs

Spring 2024

15 hrs

15 hrs

12 hrs

Summer 2024

0 hrs

0 hrs

0 hrs (student participates in
internship requiring 25 hours
work per week)

Fall 2024

15 hrs

12 hrs

12 hrs

Qualifying students and programs are discussed in Section III, Qualifying Students.

15

Semesters Enrolled

Student A

Student B

Student C

Spring 2025

15 hrs

15 hrs

12 hrs

Summer 2025

N/A

0 hrs

3 hrs

Fall 2025

N/A

3 hrs

15 hrs

Student A attends school for 30 credit hours in 2022, 2023, and 2024. In 2021 and 2025,
Student A attends for only one semester and earns the 15 equivalent hours required for one
semester. Student A qualifies for the credit for tax years 2021, 2022, 2023, 2024, and
2025.
Student B attends school for only the Fall semester in 2021 and does not take the 15
equivalent hours required for one semester. The summer hours do not count toward the
hours requirement. If the student was not enrolled full-time as a degree seeking student,
the summer school enrollment does not start the four consecutive year period for claiming
the credit.
In 2022, Student B is enrolled in both semesters and in the summer session, but only takes
27 hours total.
In 2023, Student B is enrolled in both semesters and in the summer session, and takes 30
hours. In 2024, Student B is enrolled in both semesters, but only takes 27 hours total.
In 2025, Student B is enrolled for the 15 hour equivalent in the spring semester. The credit
can only be taken for four consecutive years, from August 18, 2021 through August 17,
2025. Semesters after August 17, 2025, including the Fall 2025 semester, do not count
toward the credit. Student B qualifies for the credit in 2023, and for the Spring semester
of 2025.
Student C attends school in 2021 for one semester and does not take the 15 equivalent
hours required for one semester. The AP hours from high school do not count toward the
first semester hours.
In 2022, Student C is enrolled for one semester and only takes 12 hours, not the 15
equivalent hours required for one semester. The summer session hours do not count toward
the equivalent hours when the student only attends for one semester.
In 2023, Student C is enrolled for one semester and takes the 15 equivalent hours required
when only enrolled for one semester.
In 2024, Student C is enrolled for both semesters but only for 24 total hours. The summer
internship does not receive college credit, and so does not count toward the hours
requirement.

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In 2025, Student C is enrolled for both semesters and for the summer session for a total of
30 hours. Since the student is enrolled for 30 hours in the year, he or she can qualify for
the credit, but will not receive the credit for tuition paid for the Fall 2025 semester. The
credit can only be taken for four consecutive years, from August 18, 2021 through August
17, 2025. The two semesters in which the student was withdrawn do not extend this four
year period. Semesters after August 17, 2025, including the Fall 2025 semester, do not
count toward the credit. Student C qualifies for the credit in 2023 and 2025 (but only
for the Spring semester and summer session).

22. Do online courses count toward the hours requirement?
    Online courses taken through the qualifying school and counting toward degree
    requirements will be counted toward the hours requirement.
23. Do study abroad classes count toward the hours requirement?
    Study abroad classes will count toward the hours requirement if the qualifying South
    Carolina institution has approved the program and accepts the credit hours.
24. Do internships or co-op programs count toward the hours requirement?
    Internship or co-op program hours will count toward the hours requirement if the qualifying
    South Carolina institution has approved the internship and accepts the credit hours.
    Internship and co-op program hours allowed toward the 30 hour requirement will be the
    number of credit hours accepted by the institution, which may be different from the number
    of hours the student is required to work as part of the internship or co-op program.
25. Can a student drop a class?
    Classes that a student drops, withdraws from, or otherwise does not complete will not count
    toward the hours requirement. There is no minimum grade requirement for a student to
    meet in order for a class to count toward the hours requirement.
    SOUTH CAROLINA DEPARTMENT OF REVENUE

s/W. Hartley Powell
W. Hartley Powell, Director
July 8
, 2024
Columbia, South Carolina

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