On June 16, 2017, the South Carolina Department of Revenue (“DOR”) issued SC Revenue Procedure #17-1, “Return Due Dates and Extensions of Time to File – Revised Dates” and SC Revenue Procedure #17-2, “Withholding on South Carolina Income of Nonresident Shareholders and Partners.”
These two advisory opinions finalize temporary guidance issued by DOR earlier this year.
SC Revenue Procedure #17-1 updates and clarifies the due dates for South Carolina income tax returns and the procedure for requesting extensions of time to file returns. The document provides a federal filing and extension overview, guidance on South Carolina filing due dates, and guidance on extensions of time to file. The document also includes a summary chart of the income tax return due dates and extension periods for different entities.
SC Revenue Procedure #17-2 provides guidance on the 5% withholding tax on nonresident shareholders and partners. The document provides general information on the withholding requirements, procedures, and exceptions. Notably, the document clarifies that the new due date for partnerships to remit the withholding tax is the 15th day of the third month after the close of the tax year. The document also provides a new exception to the withholding requirement for publicly traded partnerships that are treated as a partnership for federal tax purposes.
DOR issued these advisory opinions largely in response to Public Law 114-41, the "Surface Transportation and Veterans Healthcare Choice Improvement Act," which changed the federal due dates and extension times for certain business income tax returns for tax years beginning after December 31, 2015. Notably, the federal law shortened the due date for partnerships by one month and extended the due date for C corporations by one month to ensure the filing deadline for partnerships would precede due dates for their individual and corporate investors. Accordingly, under the new federal rules, income tax returns for partnerships are due on the 15th day of the third month following the close of the tax year and income tax returns for C corporations are due on the 15th day of the fourth month following the close of the tax year, with certain exceptions. In 2016, South Carolina passed legislation amending due dates for certain returns and payment due dates in order to conform to the new federal due dates.