South Carolina Retirement
South Carolina might just be the best place to retire on the east coast. It boasts a pleasant, mild climate, beautiful beaches and one of the lowest costs of living in the nation. The cost of living in all of the state's major cities is around 10% below the national average.
The cost of living is even lower in some parts of the state. Statistical information indicates that the cost of living in Spartanburg in the Western part of the state is 21.60% below the national average. The average home in Spartanburg cost around $75,340, so housing costs in the state are low as well.
All of South Carolina is within easy driving distance of beaches on the Atlantic Ocean. It is also fairly close to major metropolitan areas including Washington DC and Atlanta. Therefore it might be an affordable alternative to Florida that is a little closer to the Northeast.
South Carolina was hard hid by the economic downturn of 2008 and is still recovering in 2011. The state has a very high unemployment rate so if you are thinking of working part time in your retirement you could have a hard time finding work.
South Carolina Income Tax
South Carolina has a state income tax with some very good tax deductions for resident retirees. The highest income tax rate in South Carolina is 7%.
Retired persons under 65 can deduct up to $3,000 in retirement income from their state income tax bills. Persons over 65 can deduct up to $10,000 in retirement income from their state income tax returns. This deduction covers all retirement income, including private and government pensions, IRAs, and Keogh plans.
All persons over 65 can deduct up to $15,000 from their South Carolina state income tax. This deduction is addition to the $10,000 retirement income deduction. That means a retiree could deduct up to $25,000 from his/her state income tax in South Carolina. No Social Security income is taxed in South Carolina so all Social Security benefits can be deducted from state income taxes.
Under South Carolina law, a married couple is entitled to two retirement income deductions if neither spouse works. That means the retirement income exemption for a married couple is effectively doubled. This exemption applies even if the couple files married filing separately.
South Carolina Sales Tax
The state sales tax rate in South Carolina is 5% but all of the state's counties charge local sales taxes that increase the rate. The sales tax rate varies from county to county but the highest total sales tax is 8%, while the lowest is 6%. South Carolina also charges a 16.8 cents per gallon gasoline tax.
Dentures, prescription drugs, and hearing aids are exempt from the sales tax but food is not. Persons over 85 years old are exempt from 1% of the sales tax.
South Carolina Property Tax
The property tax rate for residential property in South Carolina is 4% of the assessed value. This rate covers the house and up to five acres of land surrounding it. The first $100,000 in home value in South Carolina is exempt from school district property taxes. Homeowners over 65 are eligible for a homestead property tax exemption of $20,000.
All vehicles including cars, motorcycles, and recreational vehicles are taxed as property in South Carolina. The rate is around is 3% of the vehicle's Blue Book value.
South Carolina would be an excellent low cost retirement option for a person or couple with a good source of income. It offers a low cost of living, low taxes, and many recreational opportunities.
|Cost of Living Rank:||#28|
|Income Tax:||0.0% - 7.0%|