SC SCH TC 64: Formerly Incarcerated Apprenticeship Credit (Revision 2023-08)

Who files this form

Taxpayers who hire a formerly incarcerated individual in a registered apprenticeship validated by the US Department of Labor may qualify for this credit. Eligible employees must have been hired from January 1, 2022 through December 31, 2026.

The credit can be applied against Corporate or Individual Income Tax, Bank Tax, Savings and Loan Tax, Corporate License Fee, or Insurance Premium Tax. The form also provides instructions for taxpayers receiving the credit from a pass-through entity.

What you'll need

Have the following information available:

• Your name and SSN or FEIN. Individual taxpayers must provide their SSN.
• The number of qualifying employees in each employment-length group.
• Your MyDORWAY acknowledgment letters showing the tentative credit amounts.
• Your tax return showing your current-year tax liability.
• If receiving the credit from a pass-through entity, your SC K-1 and the entity's name and FEIN.

Use Form I-64, Pre-Screening for Formerly Incarcerated Apprenticeship Credit, to help determine whether an apprentice qualifies.

How to file

Apply for the credit at MyDORWAY.dor.sc.gov after the apprentice completes 12 months of employment. You must complete a new application for each tax year in which you claim the credit. After entering a qualifying individual, you will receive an acknowledgment letter showing the tentative credit amount.

Complete SC SCH.TC-64 as follows:

1. On lines 1 through 3, enter the number of qualifying employees who have completed 12 to less than 24, 24 to less than 36, and 36 to less than 48 consecutive months of employment, respectively. Multiply those counts by $3,000, $2,500, and $1,000.
2. On line 4, add the credit amounts from lines 1 through 3. The total should match your acknowledgment letters.
3. If receiving the credit from a pass-through entity, enter the SC K-1 credit amount on line 4 and the entity's name and FEIN at the top. You do not need to complete lines 1 through 3.
4. On line 5, enter your current-year tax liability. On line 6, enter the smaller of line 4 or line 5.

The text gives online instructions for the credit application, but does not state how or where to submit the completed schedule.

Common mistakes

• Applying before an apprentice completes 12 months of employment. MyDORWAY allows entry only after that point.
• Forgetting to complete a new MyDORWAY application for each tax year claimed.
• Claiming an individual another employer has already claimed. Use the MyDORWAY tool to check.
• Claiming an individual beyond the third year of the credit.
• Entering a line 4 total that does not match your acknowledgment letters when claiming for your employees.
• Claiming more than your current-year tax liability or carrying unused credit forward. Neither is allowed.

Questions people ask

When is the credit first earned?

It is first earned in the year the qualifying individual completes their 12th consecutive month of employment.

How much is the credit per eligible employee?

The amounts are $3,000 for the first year, $2,500 for the second year, and $1,000 for the third year. The credit can be claimed for up to three years of employment.

Can I carry unused credit into a future year?

No. The credit is limited to your current-year tax liability, and unused credits cannot be carried forward.

What if the credit comes from a pass-through entity?

Enter the credit shown on your SC K-1 on line 4. Enter the entity's name and FEIN at the top of the form. You are not required to complete lines 1 through 3.

Official sources

• https://dor.sc.gov/sites/dor/files/forms/TC64.pdf