Effective May 13, 2024, South Carolina has introduced a one-time income tax credit for those who encumber their property with a perpetual recreational trail easement. The new law, codified in South Carolina Code Section 12-6-3810, aims to promote the development of trail systems connecting local and regional points of interest.
Key Provisions of the new law:
- Property owners who grant a perpetual recreational trail easement on their land are eligible for a one-time income tax credit equal to ten cents per square foot of the encumbered property.
- The easement must be held by a municipality, county, special purpose district, or a Land Trust Alliance accredited land trust and recorded with the applicable county Register of Deeds.
- The trail must connect to a regional trail system plan and provide access to local or regional attractions or points of interest such as other trails, parks, waterways, or other recreational and open space attractions, retail centers, arts and cultural facilities, transportation facilities, residential concentrations, or similar destinations.
- The easement must include agreement to grant public access and address improvements and maintenance of the trail, which may include paved or soft-surface trails.
- User groups may include equestrians, pedestrians, bicyclists, and other non-motorized users.
- If the credit exceeds the taxpayer’s tax liability for the year, the excess can be carried forward for the next five taxable years.
- The total amount of tax credits available to all qualifying taxpayers is capped at one million dollars per calendar year.
The law is set to expire on January 1, 2029, and will no longer be effective for income tax years after 2028.
The new income tax credit is expected to enhance the state’s trail network and provide more opportunities for outdoor recreation, and in turn promote healthy lifestyles, boost tourism, and improve the overall quality of life for South Carolina residents and visitors alike.
