How does South Carolina recognize same-sex spouses for property tax and deed recording fee rules?

Plain-English summary

South Carolina Revenue Ruling 14-9 treats a same-sex couple legally married under any state's law as married and as spouses for South Carolina property taxes and deed recording fees.

Recognition can create eligibility for spouse-based benefits, but it can also restrict a married couple to one legal residence for the 4% assessment ratio.

Property-tax effects

The ruling identifies several potential consequences:

• a same-sex married couple may qualify its legal residence for the 4% assessment ratio;
• the couple may qualify for the homestead exemption if the statutory conditions are met;
• a same-sex spouse or surviving spouse may qualify under specified exemptions for homes of disabled veterans, law-enforcement officers, firefighters, paraplegic persons, or hemiplegic persons; and
• a transfer of real property between spouses may qualify for an exception from the assessable-transfer-of-interest rules.

Recognition can also remove a benefit. If each spouse separately owns a residence, the ruling says only one may qualify as the married couple's legal residence for the 4% ratio.

Deed recording fee

The ruling applies the spouse exemption to deeds transferring real property to a same-sex spouse. A transfer to a former same-sex spouse can also qualify when made under a divorce decree or settlement.

It also applies the family-partnership exemption to a qualifying partnership that includes same-sex spouses. That exemption requires a transfer to a partner without consideration other than reducing the recipient's partnership interest.

Refunds for prior periods

A same-sex couple, spouse, or surviving spouse could seek a refund of previously paid property tax or deed recording fees when:

• the marriage was legally valid under a state's law for the period at issue;
• the statutory exemption or special assessment applied; and
• the refund request was within the applicable time limit.

Property-tax refund requests generally involved the county, although the ruling notes that some DOR-administered exemptions first required Department approval. Deed-fee refund procedures were addressed in Revenue Procedure 97-3.

Common questions

Q: Can both spouses claim separate homes at the 4% legal-residence ratio?

A: No under the ruling. A married couple may have only one legal residence.

Q: Does the spouse deed-fee exemption apply to a same-sex spouse?

A: Yes, assuming the statutory requirements are met.

Q: Can a divorce-related transfer qualify?

A: Yes when the transfer to a former spouse is made under the divorce decree or settlement.

Q: Were refunds automatic for older periods?

A: No. The taxpayer still had to meet the underlying exemption and statutory refund deadline.

Citations and references

• S.C. Code Ann. § 12-43-220(c) (4% legal-residence assessment ratio)
• S.C. Code Ann. §§ 12-37-220, 12-37-250, and 12-37-252 (property-tax and homestead exemptions)
• S.C. Code Ann. § 12-37-3150(B) (assessable-transfer exceptions)
• S.C. Code Ann. § 12-24-40(4) and (9) (spouse, divorce, and family-partnership deed-fee exemptions)
• SC Regulation 117-1350.1 and SC Revenue Procedure #97-3 (deed-fee guidance cited by the ruling)
• SC Revenue Ruling #14-8 (income-tax recognition guidance identified by the ruling)

Subject

South Carolina Tax Treatment of Same-Sex Marriage

Source

• Landing page: https://dor.sc.gov/advisory-opinion-search
• Original PDF: https://dor.sc.gov/sites/dor/files/policies/RR14-9.pdf

Original ruling text

State of South Carolina

Department of Revenue
300A Outlet Point Blvd., P.O. Box 12265, Columbia, South Carolina 29211
Website Address: http://www.sctax.org

SC REVENUE RULING #14-9

SUBJECT:

South Carolina Tax Treatment of Same-Sex Marriage
(Property Taxes and Deed Recording Fees)

DATE:

Applies to all periods open under the statute.

REFERENCES: S.C. Constitution, Article XVII, Section 15
S.C. Code Ann. Section 12-37-220(2014)
S.C. Code Ann. Section 12-37-250 (2014)
S.C. Code Ann. Section 12-37-252 (2014)
S.C. Code Ann. Section 12-43-220 (2014)
S.C. Code Ann. Section 12-24-40 (2014)
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:

The purpose of a Revenue Ruling is to provide guidance to the public. It is an
advisory opinion issued to apply principles of tax law to a set of facts or a
general category of taxpayers. It is the Department’s position until superseded
or modified by a change in statute, regulation, court decision, or another
Departmental advisory opinion.

South Carolina’s Tax Treatment of Same-Sex Marriages
Same-sex marriages are now required to be recognized in South Carolina for tax purposes.
Accordingly, same-sex couples who are legally married under any state law will now be treated
as married for all South Carolina tax purposes and will be treated as “spouses” for all South
Carolina tax purposes. For more information on South Carolina’s recognition of same-sex
marriages and South Carolina income taxes, see SC Revenue Ruling #14-8.
This advisory opinion will provide examples of ad valorem property tax and deed recording fee
provisions that now apply to same-sex couples.

1

Property Taxation
For ad valorem property taxes, the recognition of same-sex marriages may result in a same-sex
couple being able to qualify their legal residence for the 4% assessment ratio provided in Code
Section 12-43-220(c) or the homestead exemption under Code Sections 12-37-250 and 12-37252. The recognition of same-sex marriages may also disqualify a person from qualifying for the
4% assessment ratio. For example, if each individual of a same-sex couple owned their own
residence, only one of the residences may now qualify for the 4% assessment ratio since as a
married couple they may have only one legal residence.
A person in a same-sex marriage now qualifies as a “spouse” or a “surviving spouse” for
purposes of the exemptions contained in Code Section 12-37-220 (e.g., home of certain disabled
veterans, law enforcement officers and firefighters (Code Section 12-37-220(B)(1)) and home of
a paraplegic or hemiplegic person (Code Section 12-37-220(B)(2))). Also, transfers of real
property between spouses of a same-sex couple may now be exempted from the assessable
transfer of interest rules contained in Code Section 12-37-3150(B).

Deed Recording Fee
For purposes of the deed recording fee, the recognition of same-sex marriages will now exempt
from the deed recording fee deeds that transfer realty to a same-sex spouse (Code Section 12-2440(4) and SC Regulation 117-1350.1, Question #10). Deeds that transfer realty to a former samesex spouse will be exempt if the transfer is pursuant to the terms of the divorce decree or
settlement (Code Section 12-24-40(4)).
In addition, deeds from a family partnership, one in which all partners are members of the same
family, to one of the partners are exempt as long as no consideration is paid for the transfer other
than a reduction in the grantee’s interest in the partnership (Code Section 12-24-40(9)). Since the
definition of “family” in this exemption (Code Section 12-24-40(9)) includes a “spouse,” the
exemption applies to family partnerships that include same-sex spouses.
For additional information on deed recording fee exemptions, see Code Section 12-24-40 and SC
Regulation 117-1350.1.
Refunds
The recognition in South Carolina of same-sex marriages may allow a same-sex couple, or a
same-sex spouse or surviving spouse, to be eligible for a refund of previously paid property taxes
or deed recording fees with respect to an applicable exemption or special assessment if the samesex couple was considered legally married under any state law for the period for which the
refund is requested and the refund request is made within the statutory time limitations
established under the law.

2

Additional Information
For information on these and other exemptions from property taxes and the deed recording fee,
or general information on property taxation, the deed recording fee and other taxes, visit the
Department of Revenue website at www.sctax.org.
For information about requesting a property tax refund, please contact the appropriate county. 1
For information about requesting a deed recording fee refund, see SC Revenue Procedure #97-3
at www.sctax.org.

SOUTH CAROLINA DEPARTMENT OF REVENUE

s/Rick Reames III
Rick Reames III, Director
December 31
, 2014
Columbia, South Carolina

1

For certain exemptions administered by the Department, the applicable taxpayer will need to apply for the
exemption with the Department, have the exemption granted, and then request a refund from the county.

3