SC Department of Revenue: Payment Plans
If you owe back taxes to the South Carolina Department of Revenue (SCDOR), you may qualify for a payment plan if you cannot afford to pay your tax bill in full. A payment plan allows you to pay off your tax liability in monthly installments, and the SCDOR offers payment plans on both individual and corporate back taxes. If you want a payment plan, you should contact the DOR as soon as possible. Once your wages are being garnished or other collection actions have taken place, the state will generally not approve a payment plan.
Here's what you need to know if you want a payment plan on your South Carolina back taxes.
Payment Plan Terms on South Carolina Taxes
If you owe individual income tax or GEAR debts, the SCDOR may be willing to give you up to four years to pay off your bill. Here are the terms based on how much you owe:
- 0 to $999 — 12 months or less
- $1,000 to $4,999 — 24 months or less
- $5,000 to $9,999 — 36 months or less
- $10,000 and above — 48 months or less
For example, if you owe $3,000, you may be able to make payments over a 24-month time period, but if you only owe $700, you must be able to pay off your balance in 12 payments or less.
The state determines payment plan term lengths for business taxes on a case-by-case basis.
How to Apply for a Tax Payment Plan in South Carolina
Individuals can apply for a payment plan using the following methods:
- In-person at their nearest SCDOR office.
- Through the mail using forms FS-102 (Payment Plan Request) and FS-102B (Waiver of Rights and Consequences).
- Online at the SCDOR website.
Businesses can only apply for a payment plan if they have received a payment plan request from the SCDOR, and they must use one of the following application options:
- In-person at the nearest SCDOR office.
- Through the mail using Forms FS-102 and FS-102B.
Whether you apply in person, through the mail, or online, you need to provide the SCDOR with the information requested on Form FS-102. This short single-page form requires your name or business name, contact info, the total balance due, and your proposed monthly payment amount.
Regardless of how you apply, there is a $45 application fee, and the SCDOR applies this amount to your balance.
Downpayments on SC Tax Payment Plans
If you want to pay online or with checks or money orders, you must include a downpayment with your application. The required downpayment is 10% of your GEAR balance and 20% of your individual income tax payments.
However, if you agree to make your payments with direct debit, you do not need to include a downpayment. You just provide the SCDOR with your checking account information, and you choose the date you want the SCDOR to withdraw your payments each month.
How to Determine Your Monthly Payment Amount
You can calculate your minimum monthly payment by dividing your total amount due by the maximum length of your payment plan.
For example, if you owe $12,000, you can take up to 48 months to pay off your balance. When you divide $12,000 by 48, you get your minimum monthly payment of $250.
If you want to pay off your balance faster, you can suggest a higher monthly payment, but the SCDOR will not accept a payment lower than this amount.
Terms of SC Tax Payment Plans
You must meet the following terms and obligations as you make payments on your South Carolina back taxes:
- File all required tax returns.
- Pay all new tax liabilities in full.
- Stay current with estimated income tax payments.
- Provide the SCDOR with additional information if requested.
If you fail to meet these requirements, the SCDOR will consider you in default, and the agency can start pursuing collection actions on your account.
SCDOR's Obligations to Taxpayers Making Payments
The SCDOR will not seize or levy your property when you set up a payment plan, but the state may issue a tax lien to secure its interest. Additionally, the SCDOR has the right to claim tax refunds or lottery winnings. These amounts will be applied to your balance, but they will not take the place of your agreed-upon monthly payments.
The SCDOR has the right to request information about your financial situation when you're in the midst of a payment plan. But if the department decides to change your payment plan due to an improvement in your financial situation, it must notify you in writing at least 30 days in advance.
If you default on your payment agreement, the SCDOR has the right to take legal action against you. In the case of default, the SCDOR can force immediate collection of the tax.
How to Make Changes to Your SC Payment Plan
Individuals can request changes to their payment arrangements using Form FS-147 (Payment Plan Change Request). You can use this form to change your bank draft information or payment date.
You may also use this form to add an additional bill to your payment plan. You can only add an extra bill once, and you must pay off the extra bill within 12 months.
Businesses cannot use Form FS-147. If you want to make changes to a payment plan for business taxes, you must contact the SCDOR directly.
Get Help Applying for an SC Payment Plan
Contact an SC tax pro today to get help applying for a payment plan on South Carolina back taxes. A tax professional experienced with the SCDOR can help you identify the best resolution option for your situation, and they can help you negotiate the best arrangement possible.
At TaxCure, we have a unique ranking system. You can view the top-rated professionals that can best help you with a South Carolina Payment plan.