South Carolina General Assembly
126th Session, 2025-2026
Bill 32
Indicates Matter Stricken
Indicates New Matter
(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)
Indicates Matter Stricken
Indicates New Matter
Committee Report
March 26, 2025
S. 32
Introduced by Senators Grooms, Leber, Rice, Reichenbach and Climer
S. Printed 3/26/25--S.
Read the first time January 14, 2025
________
The committee on Senate Finance
To whom was referred a Bill (S. 32) to amend the South Carolina Code of Laws so as to enact the "Pregnancy Resource Act"; by adding Section 12-6-3383 so as to provide for a tax credit for voluntary, etc., respectfully
Report:
That they have duly and carefully considered the same, and recommend that the same do pass with amendment:
(i) an organization that is exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code and is a pregnancy resource center or, crisis pregnancy center, maternity home, or residential program for human trafficking victims. To be considered an "eligible charitable organization," a pregnancy resource center or crisis pregnancy center the organization must:
(A) certify that no more than twenty percent of the contributions received under this section will be spent on administrative purposes; and
(B) file the organization's publicly available Internal Revenue Service filings with the Secretary of State annually; and
Amend the bill further, SECTION 2, by striking Section 12-6-3383(B)(1) and inserting:
(B)(1) A taxpayer who makes voluntary cash contributions during the taxable year to an eligible charitable organization is eligible for a nonrefundable tax credit not to exceed fifty percent of his total tax liability for the taxes imposed by this chapter.
Amend the bill further, SECTION 2, by striking Section 12-6-3383(D) and inserting:
(D) An Each year, an eligible charitable organization shall provide the department with a written certification that it meets all criteria to be considered an eligible charitable organization. The organization shall also notify the department of any changes that may affect eligibility under this section. In order to be recertified, the eligible charitable organization must provide the department with the number and total amount of voluntary cash contributions in the previous tax year as well as a copy of a compilation, review, or compliance audit of the organization's financial statements relating to the grants received, conducted by a certified public accounting firm.
Amend the bill further, SECTION 2, by striking Section 12-6-3383(F) and inserting:
(F) The department shall review each written certification and recertification and determine whether the organization meets all the criteria to be considered an eligible charitable organization and notify the organization of its determination. The department may also periodically request recertification from the organization. The department shall compile a list of eligible charitable organizations and make the list available to the public.
Amend the bill further, SECTION 2, by striking Section 12-6-3383(I) and inserting:
(I) The aggregate amount of tax credits that may be allocated by the department under this section during a calendar year shall not exceed three million five hundred thousand dollars. However, beginning in 2026, the aggregate amount of tax credits that may be allocated by the department under this section during a calendar year shall not exceed ten million dollars. For credits allocated during a calendar year for contributions to eligible charitable organizations, no more than twenty-five percent of such credits may be allocated for contributions to a single eligible charitable organization. However, credits not allocated before June 1, 2026 may be allocated without regard to such restriction for the same calendar year.
(J) The department may adopt rules necessary to implement the provisions of this section.
Amend the bill further, by adding an appropriately numbered SECTION to read:
SECTION X. The provisions of this act are repealed on December 31, 2030, except that if the credit allowed by Section 12-6-3383, as added by this act, is earned before the repeal, the provisions of Section 12-6-3383(B)(2) continue to apply until the credits have been fully claimed.
Amend the bill further, by striking SECTION 3 and inserting:
SECTION 3. This act takes effect upon approval by the Governor and first applies to tax years beginning after 2024.
Renumber sections to conform.
Amend title to conform.
HARVEY PEELER for Committee.
statement of estimated fiscal impact
Explanation of Fiscal Impact
State Expenditure
This bill creates an income tax credit for taxpayers who make cash contributions to eligible non-profit charitable organizations that are exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code and are either a pregnancy resource center or a crisis pregnancy center. The amount of the tax credit that can be claimed by a taxpayer is equal to the dollar contributions to the charitable organizations and is limited to 50 percent of the taxpayer's total tax liability for the tax year. Further, the bill limits the aggregate amount of the tax credit allocated in tax year 2025 to $3,500,000 and increases this annual limit to $10,000,000 beginning in tax year 2026. The bill also allows unused tax credits to be carried forward for five consecutive years from the close of the tax year in which the credits are earned. Additionally, the bill specifies that no more than 25 percent of the aggregate amount of tax credits may be allocated to a single charitable organization, with the exception of credits that are not allocated before June 1, 2026, which are allowed to be allocated without regard to the 25 percent restriction in tax year 2026.
The bill requires each eligible charitable organization to provide DOR with a written certification confirming that it meets all eligibility criteria. Additionally, DOR is required to compile a list of eligible charitable organizations and make the list publicly available.
We expect the bill will have no expenditure impact on DOR as the agency will be able to develop forms and guidance for this tax credit as well as manage the additional requirements with existing staff and resources.
State Revenue
This bill creates an income tax credit for taxpayers who make cash contributions to eligible non-profit charitable organizations that are exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code and are either a pregnancy resource center or a crisis pregnancy center. The amount of the tax credit that can be claimed by a taxpayer is equal to the dollar contributions to the charitable organizations and is limited to 50 percent of the taxpayer's total tax liability for the tax year. Further, the bill limits the aggregate amount of the tax credit allocated in tax year 2025 to $3,500,000 and increases this limit to $10,000,000 beginning in tax year 2026. The bill also allows unused tax credits to be carried forward for five consecutive years from the close of the tax year in which the credits are earned. Additionally, the bill specifies that no more than 25 percent of the aggregate amount of tax credits may be allocated to a single charitable organization, with the exception of credits that are not allocated before June 1, 2026, which are allowed to be allocated without regard to the 25 percent restriction in tax year 2026.
Given the nature of the tax credit and the fact that the bill allows taxpayers to carry forward unused credits for five consecutive years, we expect taxpayers to take advantage of this tax credit and that credits may reach the annual aggregate amount of $3,500,000 in tax year 2025 as well as $10,000,000 beginning in tax year 2026. We have also obtained data from the public Internal Revenue Service filings with the Secretary of State (SOS) of non-profit charitable organizations that self-identify as pregnancy resource centers or crisis pregnancy centers. According to these data, there were 29 such organizations headquartered in the state with a total annual reported contribution of approximately $13,690,000 based on filings from either 2022 or 2023. Also, SOS reports filings of 13 additional charitable organizations headquartered out of state that indicate being either a pregnancy resource center or a crisis pregnancy center and that may also receive contributions from SC taxpayers. Based on these data, we expect the historical annual level of contributions that exceeds $10,000,000 to such charitable organizations to remain unchanged in the future.
In summary, based on the characteristics of the tax credit as well as the historical volume of charitable contributions reported in filings of pregnancy resource centers or crisis pregnancy centers published by SOS, we expect total tax credit allocations to reach the annual aggregate amount of $3,500,000 in tax year 2025 and $10,000,000 beginning in tax year 2026. Therefore, the bill will reduce General Fund revenue from individual and corporate income taxes by $3,500,000 in FY 2025-26 and $10,000,000 beginning in FY 2026-27. However, taxpayers may carry forward the credit for five years, which may affect the timing of the revenue impact.
Frank A. Rainwater, Executive Director
Revenue and Fiscal Affairs Office
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A bill
TO AMEND THE SOUTH CAROLINA CODE OF LAWS SO AS TO ENACT THE "PREGNANCY RESOURCE ACT"; BY ADDING SECTION 12-6-3383 SO AS TO PROVIDE FOR A TAX CREDIT FOR VOLUNTARY CASH CONTRIBUTIONS MADE TO A PREGNANCY RESOURCE CENTER OR CRISIS PREGNANCY CENTER AND TO PROVIDE GUIDELINES FOR THE CREDIT.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. This act may be cited as the "Pregnancy Resource Act".
SECTION 2. Article 25, Chapter 6, Title 12 of the S.C. Code is amended by adding:
Section 12-6-3383. (A) As used in this section:
(1) "Department" means the Department of Revenue.
(2)(a) "Eligible charitable organization" means:
(i) an organization that is exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code and is a pregnancy resource center or crisis pregnancy center. To be considered an "eligible charitable organization," a pregnancy resource center or crisis pregnancy center must:
(A) certify that no more than twenty percent of the contributions received under this section will be spent on administrative purposes; and
(B) file the organization's publicly available Internal Revenue Service filings with the Secretary of State annually; and
(ii) provides services for:
(A) the prevention and diversion of children from custody with the Department of Social Services;
(B) the safety, care, and wellbeing of children in custody of the Department of Social Services;
(C) the express purpose of creating permanency for children through adoption;
(D) the prevention of abuse, neglect, abandonment, exploitation, or trafficking of children; or
(E) the provision of assistance related to carrying a pregnancy to term, preventing abortion, and promoting healthy childbirth.
(B)(1) A taxpayer who makes voluntary cash contributions during the taxable year to an eligible charitable organization is eligible for a tax credit not to exceed fifty percent of his total tax liability for the taxes imposed by this chapter.
(2) Any credit claimed under this section but not used in any taxable year may be carried forward for five consecutive years from the close of the tax year in which the credits were earned.
(C) A person taking a credit authorized by this section shall provide the name of the eligible charitable organization and the amount of the contribution to the department on forms provided by the department.
(D) An eligible charitable organization shall provide the department with a written certification that it meets all criteria to be considered an eligible charitable organization. The organization shall also notify the department of any changes that may affect eligibility under this section.
(E) The eligible charitable organization's written certification must be signed by an officer of the organization under penalty of perjury. The written certification shall include:
(1) verification of the organization's status under Section 501(c)(3) of the Internal Revenue Code;
(2) a statement that the organization does not provide, pay for, or provide coverage of abortions and does not financially support any other entity that provides, pays for, or provides coverage of abortions; and
(3) any other information that the department requires to administer this section.
(F) The department shall review each written certification and determine whether the organization meets all the criteria to be considered an eligible charitable organization and notify the organization of its determination. The department may also periodically request recertification from the organization. The department shall compile a list of eligible charitable organizations and make the list available to the public.
(G) Tax credits authorized by this section that are earned by a partnership, limited liability company, S corporation, or other similar pass-through entity, shall be allocated among all partners, members, or shareholders, respectively, either in proportion to their ownership interest in such entity or as the partners, members, or shareholders mutually agree as provided in an executed document.
(H) A person shall apply for credits with the department on forms prescribed by the department. In the application, the taxpayer shall certify to the department the dollar amount of the contributions made or to be made during the calendar year. Within thirty days after the receipt of an application, the department shall allocate credits based on the dollar amount of contributions as certified in the application. However, if the department cannot allocate the full amount of credits certified in the application due to the limit on the aggregate amount of credits that may be awarded under this section in a calendar year, the department shall so notify the applicant within thirty days with the amount of credits, if any, that may be allocated to the applicant in the calendar year. Once the department has allocated credits to a person, if the contribution for which a credit is allocated has not been made as of the date of the allocation, then the contribution must be made not later than sixty days from the date of the allocation. If the contribution is not made within such time period, then the allocation shall be cancelled and returned to the department for reallocation. Upon final documentation of the contributions, if the actual dollar amount of the contributions is lower than the amount estimated, then the department shall adjust the tax credit allowed under this section.
(I) The aggregate amount of tax credits that may be allocated by the department under this section during a calendar year shall not exceed three million five hundred thousand dollars. However, beginning in 2026, the aggregate amount of tax credits that may be allocated by the department under this section during a calendar year shall not exceed ten million dollars. For credits allocated during a calendar year for contributions to eligible charitable organizations, no more than twenty-five percent of such credits may be allocated for contributions to a single eligible charitable organization. However, credits not allocated before June 1, 2026 may be allocated without regard to such restriction for the same calendar year.
SECTION 3. This act takes effect upon approval by the Governor.
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This web page was last updated on March 26, 2025 at 09:47 PM