S.C. taxpayers claim $1.8M of gas tax credit

BY KAYLA ROBIN
kayla@theitem.com
Posted 5/12/19

More than 120,000 South Carolina taxpayers received a total of $1.8 million in tax credits because they listened when they were told at the beginning of 2018 to keep their gas receipts.

Preliminary South Carolina Department of Revenue data as of …

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S.C. taxpayers claim $1.8M of gas tax credit

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More than 120,000 South Carolina taxpayers received a total of $1.8 million in tax credits because they listened when they were told at the beginning of 2018 to keep their gas receipts.

Preliminary South Carolina Department of Revenue data as of May 3 show 120,585 taxpayers have received $1,834,727 in motor fuel income tax credits, well below the $40 million cap set by lawmakers for the credit's first year.

The credit went into effect in January to offset the increased motor fuel fee established by the General Assembly in the South Carolina Infrastructure and Economic Development Reform Act. The $0.02 per gallon increase began on July 1, 2017 and will increase by the same amount every year on July 1 until 2022, according to the S.C. Department of Revenue.

"This credit allows taxpayers to receive a benefit for the increase fee they pay at the pump," SCDOR Director Hartley Powell said in a news release. "We expect more taxpayers to file for this credit as the fee increases again next year."

The numbers are preliminary because taxpayers filing extensions have until October 15 to submit their tax return.

The $1.8 million in credits was claimed in 77,744 returns and amounts to 4.5% of the 2018 cap, which increases in 2019 to $65 million.

According to the data provided by the SCDOR, the group that filed for motor fuel income tax credits includes:

- 43,011 married couples filing joint returns;

- 22,902 single taxpayers;

- 2,355 married couples filing single returns; and

- 9,262 head of household returns.

The average credit per return was $23.65, while the average per taxpayer was $15.21, according to the data. The average credit is expected to rise next year because of the increased motor fuel user fee that goes into effect this summer.

Eligible taxpayers can get a credit on the lesser of the increase in the motor fuel user fee, which is paid when you purchase gas, or preventative maintenance costs during the same year.

The credit is available for expenses tied to a vehicle registered in South Carolina in the name of a resident taxpayer. The qualifying gas or maintenance work must be purchased in South Carolina.

From July 1, 2017, when the motor fuel user fee increased, through March 2019, more than $615 million has been deposited in the state Infrastructure Maintenance Trust Fund, including $172.4 million in increased motor fuel user fee revenues, according to figures from the South Carolina Department of Transportation.

To claim the credit:

Taxpayers should save all South Carolina receipts of gas purchases and vehicle maintenance expenses, whether by pump receipt, credit card statements or invoices. Since gas pump receipts can become illegible over time, taxpayers may want to photocopy their receipts. The receipts are not to be sent to the SCDOR, but taxpayers should save them for their records.

The gas receipts should show the number of gallons purchased in South Carolina. The maintenance receipts should show the car model, amount and type of work performed in South Carolina.

The credit is claimed on the I-385, available at www.dor.sc.gov/forms and included in many vendor's online filing products.

For more information about the motor fuel income tax credit including Q&As, guidance and examples regarding the provisions of the tax credit, check out SC Revenue Ruling #17-6.