South South Carolina Carolina

Withholding Withholding andand

Forms W-2Forms W-2South Carolina Department of South Carolina Department of RevenueRevenue

www.sctax.orgwww.sctax.org

Code Section 12-18-1540Code Section 12-18-1540

Agents shall furnish statements to taxpayers and Agents shall furnish statements to taxpayers and department; contents.department; contents.

A.A. A person required to withhold income tax under A person required to withhold income tax under this chapter, or who would have been required to this chapter, or who would have been required to withhold a tax under Section 12-8-520 if the withhold a tax under Section 12-8-520 if the taxpayer claimed a single exemption shall furnish taxpayer claimed a single exemption shall furnish on or before January 31on or before January 31stst of the following year a of the following year a properly completed federal wage and tax properly completed federal wage and tax statement or federal 1099 to the taxpayer with statement or federal 1099 to the taxpayer with respect to the remuneration paid during the respect to the remuneration paid during the calendar year, calendar year,

EMPLOYEESEMPLOYEES

Incomes subject to withholding

An employer paying wages to an employee shall withhold income tax for that employee

if at the time of payment the wages are expected to equal one thousand dollars or more

during the year

Wages not subject to SC withholding

1) Wages of a resident employee receiving wages 1) Wages of a resident employee receiving wages in another state if: in another state if:

a) the wages are subject to the withholding laws a) the wages are subject to the withholding laws of the state in which they are earned; and of the state in which they are earned; and

b) the employer is withholding income taxes on b) the employer is withholding income taxes on behalf of the other state. behalf of the other state.

2) Wages of an employee obtaining a waiver from 2) Wages of an employee obtaining a waiver from

withholding pursuant to Section 12‑8‑1040withholding pursuant to Section 12‑8‑1040. .

Wages not subject to SC withholding

3.) Wages of spouses who are eligible for the Military 3.) Wages of spouses who are eligible for the Military Spouses Residency Relief Act:Spouses Residency Relief Act:

a)a)PL 111-97 was signed into Federal law on November 11, PL 111-97 was signed into Federal law on November 11, 20092009

b)b)Income of servicemember’s spouse is not taxable to the Income of servicemember’s spouse is not taxable to the state where the services are performed. state where the services are performed.

c)c)Prior to the Act, nonresident military spouse’s income for Prior to the Act, nonresident military spouse’s income for services performed in South Carolina would be taxed in services performed in South Carolina would be taxed in South Carolina.South Carolina.

Military Spouses Residency Relief Military Spouses Residency Relief ActAct

RequirementsRequirementsServicemember is in South Servicemember is in South Carolina as a result of military Carolina as a result of military orderorderServicemember and spouse have Servicemember and spouse have the same state of domicilethe same state of domicileSouth Carolina is not the state of South Carolina is not the state of domiciledomicileSpouse resides in the state solely Spouse resides in the state solely in order to live with the in order to live with the servicememberservicemember

SC W-4SC W-4

A service member’s A service member’s nonresident spouse nonresident spouse claiming an exemption claiming an exemption from SC withholding taxfrom SC withholding tax

Must be completed before Must be completed before January 1January 1stst

SC Revenue Ruling #10-5SC Revenue Ruling #10-5

Filing WH-Filing WH-16051605

WH-1605WH-1605Last day of the Last day of the month following month following quarter endquarter end

When the When the withholding account withholding account is closedis closed

File amended returnFile amended return

Filing WH-Filing WH-16061606WH-1606WH-1606Last day of FebruaryLast day of February

When the When the withholding account withholding account is closedis closed

File amended returnFile amended return

W-2’s and 1099’sW-2’s and 1099’s

How do you submit W-2s and/or 1099s to SC DORHow do you submit W-2s and/or 1099s to SC DOR

Electronically via www.scbos.gov (W-2s only)Electronically via www.scbos.gov (W-2s only)

CD-ROMCD-ROM

Paper FormsPaper Forms

W-2’s and 1099’sW-2’s and 1099’s

Electronic FilingElectronic Filing

Not available for 1099 Series FormsNot available for 1099 Series Forms

Not available for W-2G, W-2CNot available for W-2G, W-2C

Filing WH-Filing WH-16121612WH-1612WH-1612With CD-ROM With CD-ROM

With paper With paper

Closing a withholding file numberClosing a withholding file number

MethodsMethods Form C-278Form C-278

WH-1605 or WH-1606WH-1605 or WH-1606

eWithholdingeWithholding

TeleFileTeleFile

Closing a withholding file numberClosing a withholding file number

Items that are submitted to DOR Items that are submitted to DOR

1.1. Complete W-2’s and 1099 and WH-1612 if requiredComplete W-2’s and 1099 and WH-1612 if required

2.2. Complete the last WH-1605Complete the last WH-1605

3.3. Complete WH-1606Complete WH-1606

4.4. Complete SC-8822Complete SC-8822

Code Section 12-8-2020Code Section 12-8-2020

Refund of credit for overpaymentRefund of credit for overpayment(A) A refund or credit may be allowed for an overpayment of (A) A refund or credit may be allowed for an overpayment of

tax withheld pursuant to the chapter to:tax withheld pursuant to the chapter to:

(1) the withholding agent to the extent that the (1) the withholding agent to the extent that the withholding agent did withholding agent did not withhold the overpayment not withhold the overpayment amount from the taxpayer; oramount from the taxpayer; or

(2) the taxpayer to the extent that the overpayment was (2) the taxpayer to the extent that the overpayment was withheld from the taxpayer.withheld from the taxpayer.

Code Section 12-8-2020Code Section 12-8-2020

Refund of credit for overpaymentRefund of credit for overpayment(B) A refund or credit may be granted to a withholding (B) A refund or credit may be granted to a withholding

agent who has withheld taxes in error if the withholding agent who has withheld taxes in error if the withholding agent has refunded or unconditionally credited the amount agent has refunded or unconditionally credited the amount erroneously withheld to the taxpayer and the amount is erroneously withheld to the taxpayer and the amount is refunded or credited to the taxpayer before the issuance of refunded or credited to the taxpayer before the issuance of the original wage and tax statement for the calendar year.the original wage and tax statement for the calendar year.

Corrected Corrected W-2W-2 Use W-2C to Use W-2C to

correct errors on correct errors on Form W-2Form W-2

Submit with Submit with amended WH-1605 amended WH-1605 and WH-1606and WH-1606

Can not reduce Can not reduce South Carolina South Carolina State income taxState income tax

SC WithholdingSC Withholding

Reconcile withholding before issuing W-2 and 1099 FormsReconcile withholding before issuing W-2 and 1099 Forms

No inactive status – Withholding is either open or closedNo inactive status – Withholding is either open or closed

Always file a return if withholding account is openAlways file a return if withholding account is open

Close the withholding account if no payrollClose the withholding account if no payroll

File all required quarterly return(s) when you close your File all required quarterly return(s) when you close your businessbusiness

QuestionsQuestions

Thank YouThank You