How long did South Carolina extend its temporary COVID-19 remote-work nexus and employer-withholding relief?

Plain-English summary

SC Information Letter #20-29 further extended South Carolina's temporary COVID-19 remote-work tax relief through June 30, 2021.

The Department had first issued Information Letter 20-11 on May 15, 2020. According to this extension notice, that earlier letter addressed two issues caused solely by employees temporarily working from a different location because of COVID-19:

• Whether the temporary work location established income-tax or sales-tax nexus for the employer.
• The employer's income-tax withholding requirements for those employees.

The original relief ran from March 13 through September 30, 2020. Information Letter 20-24 extended it through December 31, 2020. Information Letter 20-29 then moved the end date to June 30, 2021.

What this means for you

Employers with temporary remote workers in 2020 and 2021

The Department did not end the special relief on December 31, 2020. This notice kept it in place for the first half of 2021.

Payroll and tax teams

Use Information Letter 20-11 for the actual nexus and withholding rules. Information Letter 20-29 is only an extension notice and does not repeat the underlying conditions, limitations, or examples.

Current remote-work arrangements

This relief expired June 30, 2021. It does not establish a present-day nexus or withholding rule for remote employees.

Common questions

Q: What changed in Information Letter 20-29?

A: The end date. The Department extended the same temporary relief through June 30, 2021.

Q: Did the notice create permanent remote-work nexus relief?

A: No. It states a temporary period ending June 30, 2021.

Q: Does this page contain the complete employer-withholding rule?

A: No. The notice directs readers to Information Letter 20-11 for the full text and relief details.

Citations and references

• SC Information Letter 20-11 — the incorporated underlying nexus and withholding guidance
• SC Information Letter 20-24 — the prior extension through December 31, 2020
• S.C. Code Ann. § 12-4-320; § 1-23-10(4) — Department authority cited in the notice

Source

• Landing page: SC Advisory Opinion Search
• Original PDF: IL20-29.pdf

Original ruling text

STATE OF SOUTH CAROLINA

DEPARTMENT OF REVENUE
300A Outlet Pointe Blvd., Columbia, South Carolina 29210
P.O. Box 125, Columbia, South Carolina 29214-0575

SC INFORMATION LETTER #20-29

SUBJECT:

Extended Tax Relief - Nexus and Income Tax Withholding Requirements for Employers with Workers Temporarily Working Remotely as a Result of COVID-19 (Income Tax and Sales Tax)

DATE:

November 30, 2020; Effective from March 13, 2020 – June 30, 2021

MODIFIES:

SC Information Letter #20-11
SC Information Letter #20-24

AUTHORITY:

S.C. Code Ann. Section 12-4-320 (2014)
S.C. Code Ann. Section 1-23-10(4) (2005)
SC Revenue Procedure #09-3

SCOPE:

An Information Letter is a written statement issued to the public to announce general information useful in complying with the laws administered by the Department. An Information Letter has no precedential value.

On May 15, 2020, the Department issued SC Information Letter #20-11 to announce temporary relief regarding a business’s establishment of nexus (income and sales) solely because an employee is temporarily working in a different work location due to COVID-19 and provided guidance with respect to employer withholding requirements for these employees. The relief was effective from March 13, 2020 through September 30, 2020. SC Information Letter #20-24, issued August 26, 2020, extended the relief until December 31, 2020. The Department is announcing that the relief set forth in SC Information Letter #20-11 is further extended through June 30, 2021. The full text of SC Information Letter #20-11 and the relief provided can be found on the Department’s Law and Policy page at dor.sc.gov/policy.