H 4765 Session 110 (1993-1994)
H 4765 General Bill, By Richardson, J.J. Bailey, R.A. Barber, Cato,
R.S. Corning, S.E. Gonzales, Harrell, Keegan, Kelley, W.D. Keyserling, Meacham,
Riser, Simrill, Witherspoon, Young-Brickell and R.M. Young
A Bill to amend Section 12-7-435, as amended, Code of Laws of South Carolina,
1976, relating to deductions from South Carolina taxable income for purposes
of the state individual income tax, so as to eliminate the retirement income
exclusion election and provide for the deduction of all retirement income
beginning for the taxable year the taxpayer attains age sixty-five.
02/17/94 House Introduced and read first time HJ-11
02/17/94 House Referred to Committee on Ways and Means HJ-11
A BILL
TO AMEND SECTION 12-7-435, AS AMENDED, CODE OF LAWS
OF SOUTH CAROLINA, 1976, RELATING TO DEDUCTIONS
FROM SOUTH CAROLINA TAXABLE INCOME FOR PURPOSES
OF THE STATE INDIVIDUAL INCOME TAX, SO AS TO
ELIMINATE THE RETIREMENT INCOME EXCLUSION
ELECTION AND PROVIDE FOR THE DEDUCTION OF ALL
RETIREMENT INCOME BEGINNING FOR THE TAXABLE YEAR
THE TAXPAYER ATTAINS AGE SIXTY-FIVE.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 12-7-435(k) of the 1976 Code, as added by Act
171 of 1991, is amended to read:
(k) (1) Beginning with the taxable year in which a taxpayer first
receives retirement income, the taxpayer may:
(A) deduct his retirement income in an amount not to exceed
three thousand dollars annually; or
(B) elect irrevocably to defer claiming a retirement income
deduction until the taxable year the taxpayer attains the age of sixty-five
years, at which time the taxpayer may deduct his retirement income in
an amount not to exceed ten thousand dollars annually. (2) A
taxpayer who does not claim a retirement income deduction before the
taxable year in which he attains the age of sixty-five years is considered
to have made the election allowed pursuant to subitem (1)(B) of this
item.
(3) A taxpayer who has attained the age of sixty-five years
before 1994 is considered to have made the election allowed pursuant to
subitem (1)(B) of this item.
(4) A taxpayer who in 1993 has not yet attained the age of
sixty-five years and who receives retirement income in 1993 may: (A) deduct his retirement income in an amount not to exceed
three thousand dollars annually; or
(B) elect irrevocably to defer claiming a retirement income
deduction until the taxable year the taxpayer attains the age of sixty-five
years, at which time the taxpayer may deduct his retirement income in
an amount not to exceed ten thousand dollars annually. (5) The
deduction allowed by this item extends to the taxpayer's surviving
spouse and, to the extent the surviving spouse receives retirement
income attributable to the deceased spouse, applies in the same manner
that the deduction applied to the deceased spouse. (6) For
purposes of this item, "retirement income" means the total
of all otherwise taxable income not subject to a penalty for premature
distribution received by the taxpayer or the taxpayer's surviving spouse
in a taxable year from qualified retirement plans which include those
plans defined in Internal Revenue Code Sections 401, 403, 408, and 457,
and all public employee retirement plans of the federal, state, and local
governments, including military retirement for persons with twenty or
more years active military duty. (7) The commission shall
prescribe the method of making the election provided in this item and
may require the taxpayer to provide information necessary for proper
administration of this election. (8) (A)For a taxpayer born in the
years 1943 through 1959, where subitems (1), (2), and (4) of this item
refer to age sixty-five, the applicable age is sixty-six.
(B) For a taxpayer born after 1959, where subitems (1), (2),
and (4) of this item refer to age sixty-five, the applicable age is
sixty-seven.
(1) Retirement income received by a resident individual
taxpayer who before or during the applicable taxable year has attained
age sixty-five. The deduction allowed by this item extends to a deceased
taxpayer's surviving spouse, regardless of age, but only for retirement
income attributable to the deceased taxpayer.
(2) For purposes of this item `retirement income' means the total
of all otherwise taxable income received in a taxable year by a taxpayer
who has attained age sixty five or the taxpayer's surviving spouse from
qualified retirement plans which include those plans defined in Internal
Revenue Code Sections 401, 403, 408, and 457, and all public employee
retirement plans of the federal, state, and local governments, including
military retirement for persons with twenty or more years active military
duty."
SECTION 2. Upon approval by the Governor, this act is effective for
taxable years beginning after 1993.
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