Retiring in South Carolina: how your income is taxed
South Carolina is fairly tax-friendly for retirees. On a typical retirement income it ranks #24 of 51 for the lowest state income tax.
The rules in South Carolina
- Social Security: Social Security and Railroad Retirement benefits are fully exempt from South Carolina income tax.
- Pensions: At 65 and older, each person can deduct up to $10,000 of retirement income; under 65, up to $3,000. The same limit covers 401(k) and IRA withdrawals. At 65 and older there is also a $15,000 deduction against any income, reduced by the retirement and military deductions claimed. Military and Reserve or National Guard retirement pay is fully exempt, and other government pensions use the same $3,000 or $10,000 deduction.
- 401(k), 403(b) and IRA withdrawals: 401(k) and IRA withdrawals share the retirement deduction with pensions: $10,000 at 65 and older, $3,000 under 65. The $15,000 age-65 deduction can shelter more, less any retirement deduction claimed.
- At 65 and older: From 2026 South Carolina doesn't use the federal standard deduction, so neither the extra federal amount at 65 nor the federal senior deduction applies; the $15,000 age 65 deduction does.
Calculate your South Carolina retirement taxes
State income tax in South Carolina: $199 a year
In South Carolina, the 401(k)/IRA amount counts as IRA withdrawals, which don't qualify for the pension exclusion. Enter withdrawals from employer plans such as a 401(k) or 403(b) as pension.
In South Carolina you'd pay about $199 in state income tax and $4,336 in federal income tax on $70,000 of retirement income, keeping $65,465 (6.5% total).
South Carolina ranks #24 of 51 for the lowest state tax on this income. 19 states charge no state income tax on this income.
What retirees pay in South Carolina
| Retirement income | State tax (single) | State tax (married) | Federal tax (single) |
|---|---|---|---|
| $24,000 Social Security, $12,000 401(k)/IRA | $0 | $0 | $0 |
| $30,000 Social Security, $20,000 pension, $20,000 401(k)/IRA | $199 | $0 | $4,336 |
| $40,000 Social Security, $40,000 pension, $50,000 401(k)/IRA, $10,000 other income | $3,320 | $1,118 | $19,812 |
Age 67 or older, 2026 rules including the federal senior deduction. For married couples, income is the household total and both spouses are 67 or older. State estimates apply South Carolina's main exclusions and may differ for income-tested credits.
States with lower retirement taxes
Moving to South Carolina in retirement?
Compare the tax on your Social Security, pension and 401(k)/IRA income, and typical living costs, with the state you'd leave. These are the states most households moving to South Carolina come from (IRS migration data, 2022–2023).
- North Carolina to South Carolina
- Florida to South Carolina
- Georgia to South Carolina
- New York to South Carolina
- Virginia to South Carolina
- Pennsylvania to South Carolina
Frequently asked questions
Does South Carolina tax Social Security?
Not taxed. Social Security and Railroad Retirement benefits are fully exempt from South Carolina income tax.
Does South Carolina tax pensions?
Partly taxed. At 65 and older, each person can deduct up to $10,000 of retirement income; under 65, up to $3,000. The same limit covers 401(k) and IRA withdrawals. At 65 and older there is also a $15,000 deduction against any income, reduced by the retirement and military deductions claimed. Military and Reserve or National Guard retirement pay is fully exempt, and other government pensions use the same $3,000 or $10,000 deduction.
Does South Carolina tax 401(k) and IRA withdrawals?
Partly taxed. 401(k) and IRA withdrawals share the retirement deduction with pensions: $10,000 at 65 and older, $3,000 under 65. The $15,000 age-65 deduction can shelter more, less any retirement deduction claimed.
Is South Carolina a good state to retire for taxes?
For a single retiree with $30,000 Social Security, $20,000 pension, $20,000 401(k)/IRA, South Carolina charges about $199 in state income tax, ranking #24 of 51 (lowest tax first).
Related
Sources: dor.sc.gov, dor.sc.gov (2), dor.sc.gov (3). Rules reviewed .