South Carolina taxpayers have the chance to save a little extra money by keeping receipts when they fuel up their vehicles starting in January.
That’s when a new income tax credit goes into effect to offset the gas tax increase approved by the Legislature earlier this year, according to a news release from the S.C. Department of Revenue.
Lawmakers in May approved raising the gas tax by two cents a year for six years, a total of 12 cents. Taxpayers will get an average $286 tax credit in tax year 2023, officials estimated when the credit was approved.
Taxpayers can claim this fuel income tax credit for the first time when filing their 2018 state income tax returns at the beginning of 2019.
Here’s what you need to know to claim the credit, according to the Department of Revenue’s website:
▪ Only resident taxpayers are eligible.
▪ Up to two private passenger motor vehicles can be considered for the credit. Motorcycles are included.
▪ Taxpayers must save receipts from fuel purchases and invoices from vehicle preventative maintenance costs such as oil changes and new tires in South Carolina. Fuel purchased outside the state and maintenance done outside the state cannot be included. The credit cannot exceed the lesser amount paid for either the gas tax increase or the vehicle’s preventative maintenance.
▪ Fuel receipts or credit card statements must show the number of gallons purchased.
▪ Maintenance invoices must show the car model, amount, and type of preventative maintenance work performed in South Carolina.
▪ Taxpayers will calculate and claim the credit on Form I-385, which will be available in January 2019.
For more information visit the website at https://dor.sc.gov.
Lisa Wilson: 843-706-8103