FindMyRebate See my rebates

All of South Carolina · Tax credit

Solar Energy, Small Hydropower and Geothermal Tax Credit (South Carolina)

Run by South Carolina Department of Revenue

South Carolina income tax credit of 25% of the cost to buy and install a solar energy system, small hydropower system or geothermal heat pump, up to $3,500 a year per facility or 50% of your state tax liability, with unused credit carried forward up to 10 years.

Open Checked Oct 25, 2026

Amounts

How much you get

25% of the purchase and installation cost (equipment, labor, permits, wiring, inverters, mounting and sales tax). The credit used in any year is limited to the lesser of $3,500 per facility or 50% of your South Carolina income tax liability; the excess carries forward for up to 10 years. It's nonrefundable. Utility rebates that are excluded from taxable income reduce the cost the credit is figured on.

Eligibility

Do I qualify?

You need to meet all 5 of these.

  • Your home is in South Carolina.

  • You must own the system and the building it's installed on in South Carolina. Leased systems, community solar subscriptions and renters don't qualify. Solar or small hydro can be on any facility you own (including a rental property); geothermal must be at your primary residence.

  • The credit is nonrefundable, so you need South Carolina income tax liability to use it. Each year it's limited to 50% of that liability.

  • Solar systems must be certified for performance by the Solar Rating and Certification Corporation (SRCC) or a comparable entity endorsed by the State Energy Office. A utility interconnection agreement counts as certification for grid-tied solar PV; off-grid PV needs the Energy Office's Certification for PV Systems form. Geothermal equipment must meet or exceed federal ENERGY STAR requirements on the date of installation.

    What to doKeep your utility interconnection agreement, or fill out the Energy Office's Certification for PV Systems form for an off-grid system, and keep it with your tax records.

  • The credit can't be claimed before installation is complete; it's claimed for the tax year installation is finished.

Applying

How to apply

You claim it on your tax return. Claimed on the South Carolina income tax return for the year installation is completed. The geothermal part of the credit is repealed on January 1, 2032.

  1. Install a qualifying system you own.

    Keep the invoices, the SRCC certification or utility interconnection agreement, and equipment certifications.

  2. Fill out Schedule TC-38 with your South Carolina income tax return.

    Claim it for the year installation is complete. Enter the credit on the SC1040TC.

  3. Carry any unused credit forward.

    Unused credit carries forward up to 10 years, still limited each year to $3,500 per facility or 50% of your tax liability.

Forms and instructionsSouth Carolina Code of Laws, Title 12 Chapter 6 (Section 12-6-3587) · SC Revenue Ruling · Contact the SCDOR

Questions about applying1-844-898-8542 or IITax@dor.sc.gov

Your address

Next steps

Check that it covers your address. Then, if you want, ask for a contractor quote.

FAQ

Questions

How much does Solar Energy, Small Hydropower and Geothermal Tax Credit (South Carolina) pay?

25% of the purchase and installation cost (equipment, labor, permits, wiring, inverters, mounting and sales tax). The credit used in any year is limited to the lesser of $3,500 per facility or 50% of your South Carolina income tax liability; the excess carries forward for up to 10 years. It's nonrefundable. Utility rebates that are excluded from taxable income reduce the cost the credit is figured on.

Do renters qualify?

You must own the system and the building it's installed on in South Carolina. Leased systems, community solar subscriptions and renters don't qualify. Solar or small hydro can be on any facility you own (including a rental property); geothermal must be at your primary residence.

What’s the deadline?

No fixed deadline. Apply any time while it’s open.

Is it still available?

Yes. It was open when we last checked, on October 25, 2026.

Can I claim the credit for a leased solar system or community solar?

No. The credit is only for a system you bought and installed on a South Carolina facility you own, so leases and typical community solar subscriptions don't qualify.

Can I claim it if I financed the system with a loan?

Yes. If you're obligated to pay the full cost, you can use the purchase and installation cost, but not interest, fees or extended warranties.

What happens to unused credit if I sell the house?

You keep it. Unused credit still carries forward up to 10 years after a sale; it doesn't transfer to the buyer.

Can I claim the credit for systems at two homes I own?

Yes. Each facility has its own $3,500 annual limit, but the total is still capped at 50% of your tax liability.

References

Sources

This page is built from these official pages, run by the program itself.

  1. South Carolina Code of Laws, Title 12 Chapter 6 (Section 12-6-3587)scstatehouse.gov · Read Oct 25, 2026 · Re-checked monthly
  2. SC Schedule TC-38 (Rev. 3/28/22)dor.sc.gov · Read Oct 25, 2026 · Re-checked monthly
  3. SC Revenue Rulingenergy.sc.gov · Read Oct 25, 2026 · Re-checked monthly
  4. Contact the SCDORdor.sc.gov · Read Oct 25, 2026 · Re-checked monthly

When one of these pages changes, we re-check this page against it.

Report a problem with this page

Nearby

More in South Carolina