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South Carolina residents got more than higher prices at the gas pump ahead of the Fourth of July holiday.
The value of an income tax credit sharply increased July 1 from $350 to $1,500 for state residents taking classes at 2-year community colleges this month. Students enrolled in 4-year colleges will see the tax credit increase from $850 to $1,500.
The college tax credit is based upon 50 percent of tuition and fees paid after scholarship funds are used. Students can claim the credit when filing their 2018 income tax forms next year.
The tax credit was included by state lawmakers in a 2017 law which raised South Carolina’s gasoline taxes. Gas taxes are rising 2 cents a gallon over a 6-year period to help fund major road improvements.
Spartanburg Community College President Henry Giles likens the tax credit to “last resort dollars” intended to cover any funding shortfalls students experience once they have used scholarships and financial aid. Giles estimates the tax credit will help students cover up to three-fourths of the current $2,172 semester cost to attend Spartanburg Community College this fall.
“Anything that will help students find it more affordable to continue their education is a great thing for our South Carolina residents,” Giles said. “We hope this will help increase students’ awareness about the need for additional education and job training. We encourage students to take advantage of the tax credit.”
Students can claim the income tax credit when they file their 2018 taxes. They must be enrolled in a college degree program, be eligible for in-state tuition, and have completed at least 30 credit hours.
The tax credit can be claimed for a maximum of four straight years of tuition. This would work out to five tax years for a student starting college this fall.
There are restrictions limiting how many students can benefit from the income tax credit. Students can’t receive the tax credit if they have obtained a GED high school equivalency diploma or received the state’s Palmetto Fellows scholarship or LIFE (Legislative Incentives for Future Excellence) scholarship; have defaulted on federal or state education loans; or been convicted or pleaded guilty to any felonies or alcohol and drug offenses.