NORTH CAROLINA
Sales Taxes
State Sales Tax: 4.25% (prescription drugs, medical equipment exempt, food subject to 2% county tax); Some county taxes can increase the total to 7.5%.
Gasoline Tax: 30.2 cents/gallon
Diesel Fuel Tax: 30.2 cents/gallon
Cigarette Tax: 35 cents/pack of 20
Personal Income Taxes
Tax Rate Range: Low - 6.0%; High - 8.00% (2007) (rate will be 7.75% after January 2008)
Income Brackets: * Lowest - $12,750; Highest - $120,000
Number of Brackets: 4
Personal Exemptions: ** Single - $3,200; Married - $6,400; Dependents - $3,200
Standard Deduction: Single - $3,750; Married filing jointly - $6,100
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction: None
Retirement Income Taxes: Social Security is exempt. At least $4,000 in exclusions for federal, state and local pensions (depending on dates and length of service); up to $2,000 exemption for qualified private pensions, including IRAs. Out-of-state government pensions also qualify for the $4,000 exemption. State retirees with at least 5 years of creditable service as of August 12, 1989, will be permanently exempt from state income tax on their retired/retainer pay. Be sure to investigate the Bailey decision. Taxable income also includes income derived from gaming in North Carolina. For more details on retirement income deductions, click here.
Retired Military Pay: If an individual had five years of creditable service as of August 12, 1989, all military retired pay is exempt from taxes. Otherwise, a deduction of up to $4,000 is allowed for military pay or survivor's benefits.
Military Disability Retired Pay: Disability Portion - Length of Service Pay; Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless combat incurred. Retired Pay - Based solely on disability: Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless all pay based on disability and disability resulted from armed conflict, extra-hazardous service, simulated war, or an instrumentality of war.
VA Disability Dependency and Indemnity Compensation: Not subject to federal or state taxes
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.
Property Taxes
All property, real and personal, is subject to taxation and is assessed based on 100% of appraised value. Taxes are collected by cities and counties. Under the homestead exemption, the greater of $20,000, or 50% of the appraised value of real property owned by a North Carolina resident and occupied by the owner as his or her permanent residence is excluded from the taxpayer's assessment, if the following requirements are met: (1) The owner is 65 years of age or older or is totally and permanently disabled. (2) The disposable income of the owner did not exceed $19,700 for calendar year 2005 if applying in 2006, or $20,500 for calendar year 2006 if applying in 2007. The income eligibility limit is adjusted each year by the Social Security cost-of-living adjustment. The disposable income limit amount includes all moneys received plus the disposable income of the applicant's spouse if they reside together. Call 919-733-7711 for details or click here.
Inheritance and Estate Taxes
There is no inheritance tax and the estate tax is related to federal estate tax collection.
For further information, visit the North Carolina Department of Revenue site.
* The tax brackets reported are for single individuals. For married taxpayers, the same rates apply to income brackets ranging from $21,250 to $200,000. An additional middle income tax credit is allowed.
** Taxpayers who claim standard deduction or itemize deductions on federal return must make adjustments.
SOUTH CAROLINA
Sales Taxes
State Sales Tax: 6% (prescription drugs exempt); 25 counties impose an additional 1% local option sales tax; a number of counties impose a 2% sales tax. Seniors 85 and older pay 4%.
Gasoline Tax: 16.8 cents/gallon
Diesel Fuel Tax: 16.8 cents/gallon
Cigarette Tax: 7 cents/pack of 20
Personal Income Taxes
Tax Rate Range: Low - 2.5%; High - 7%
Income Brackets: ** Lowest - $2,570; Highest - $12,851
Number of Brackets: 6
Personal Exemptions: * Single - $3,200; Married - $6,400; Dependents - $3,200
Standard Deduction: Single - $4,750; Married filing jointly - $9,500
Medical/Dental Deduction: Federal amount
Federal Income Tax Deduction: None
Retirement Income Taxes: Retirement income is taxed. Social Security exempt. Under age 65, $3,000 in pension income is exempt. At 65, the deduction is $10,000. After 65, the deduction if $15,000 (single)/$30,000 (joint). Some taxpayers age 65 and older may not have to file a tax return if they meet certain conditions. For more information, click here.
Retired Military Pay: Retirees with 20 or more years of active duty can deduct up to $3,000 annually until age 65 and up to $10,000 per year after age 65. This deduction extends to the surviving spouse. Pension or retirement income received for time served in the National Guard or Reserve components is not taxable. Survivor benefits are taxed following federal tax rules.
Military Disability Retired Pay: Disability Portion - Length of Service Pay; Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless combat incurred. Retired Pay - Based solely on disability: Member on September 24, 1975 - No tax; Not Member on September 24, 1975 - Taxed, unless all pay based on disability and disability resulted from armed conflict, extra-hazardous service, simulated war, or an instrumentality of war.
VA Disability Dependency and Indemnity Compensation: Not subject to federal or state taxes
Military SBP/SSBP/RCSBP/RSFPP: Generally subject to state taxes for those states with income tax. Check with state department of revenue office.
Property Taxes
Property tax is assessed and collected by local governments. Both real and personal property are subject to tax. The market value of a legal residence and up to 5 acres of surrounding land is assessed at 4%. For homeowners 65 and older, the state's homestead exemption allows the first $50,000 of their property's fair market value to be exempt from local property taxes. South Carolina imposes a casual excise tax of 5% on the fair market value of all motor vehicles, motorcycles, boats, motors and airplanes transferred between individuals. For more information, click here.
Inheritance and Estate Taxes
There is no inheritance tax and the estate tax is related to federal estate tax collection.
For further information, visit the South Carolina Department of Revenue site or 800-763-1295. If you are planning to move to South Carolina, this link will provide you with some helpful information.
* State allows personal exemption or standard deductions as provided in the Internal Revenue Code.