H 5180

South Carolina General Assembly
126th Session, 2025-2026
Bill 5180
Indicates Matter Stricken
Indicates New Matter
(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)
A bill
TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING SECTION
12-6-1155 SO AS TO ALLOW A DEDUCTION FOR A FARMER WHO SELLS OR LEASES FARMLAND
TO A BEGINNING FARMER OR ENTERS INTO A CROP-SHARE AGREEMENT WITH AN EXISTING
FARMER, AND TO SET FORTH THE LIMITATIONS ON THE DEDUCTION.
Be it enacted by the
General Assembly of the State of South Carolina:
SECTION 1.  Article 9, Chapter 6, Title 12 of the S.C. Code is
amended by adding:
    Section
12-6-1155. (A)(1) A taxpayer who is
a farm owner who sells all or a portion of such farmland to a beginning farmer is
allowed a deduction from South Carolina taxable income equal to the amount of
capital gains received from the sale in the tax year. The deduction is limited
by the amounts set forth in item (2) and only to the extent the capital gains
were included in federal adjusted gross income for the tax year.
       (2)
A taxpayer is allowed a deduction equal to:
  (a)
one hundred percent for the first two million dollars of capital gains;
  (b)
eighty percent for the next one million dollars of capital gains;
  (c)
sixty percent for the next one million dollars of capital gains;
  (d)
forty percent for the next one million dollars of capital gains; and
  (e)
twenty percent for the next one million dollars of capital gains.
    (B) A
taxpayer who is a farm owner who enters a lease or rental agreement for all or
a portion of such farmland with a beginning farmer is allowed a deduction from
South Carolina taxable income equal to the amount of cash-rent income received
from the lease or rental, but not to exceed twenty-five thousand dollars, and
only to the extent the income was included in federal adjusted gross income for
the tax year.
    (C) A
taxpayer who is a farm owner who enters a crop-share arrangement on all or a
portion of such farmland with a beginning farmer is allowed a deduction from
South Carolina taxable income equal to the amount of income received from the arrangement,
but not to exceed twenty-five thousand dollars, and only to the extent the
income was included in federal adjusted gross income for the tax year.
    (D)
The Department of Agriculture shall assist the Department in Revenue in
determining eligibility and the amount of the deduction. Each agency may adopt
rules and promulgate regulations necessary to implement the provisions of this
section.
    (E)
For purposes of this section:
       (1)
"Beginning farmer" means a taxpayer who:
  (a)
has filed at least one but not more than ten Internal Revenue Service Schedule
F (Form 1040) Profit or Loss From Farming forms since turning eighteen years of
age;
  (b)
is approved for a beginning farmer loan through the United States Department of
Agriculture Farm Service Agency Beginning Farmer direct or guaranteed loan
program;
  (c)
has a farming operation that is determined by the South Carolina Department of Agriculture
to be new production agriculture but is the principal operator of a farm and
has substantial farming knowledge; or
  (d)
has been determined by the South Carolina Department of Agriculture to be a
qualified family member.
       (2)
"Farm owner" means an individual who owns farmland held in a conservation
easement and disposes of, or relinquishes use of, all or some portion of such
farmland by:
  (a)
a sale to a beginning farmer;
  (b)
a lease or rental agreement not exceeding ten years with a beginning farmer; or
  (c)
a crop-share agreement not exceeding ten years with a beginning farmer.
       (3)
"Qualified family member" means an individual who is related to a farm owner
within the fourth degree by blood, marriage, or adoption and who is purchasing
or leasing or is in a crop-share arrangement for land from all or a portion of
such farm owner's farming operation.
SECTION 2.  This act takes effect upon approval
by the Governor and first applies to sales, leases, and agreements made for tax
years beginning after 2025.
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This web page was last updated on February 12, 2026 at 11:48 AM