South Carolina H 4089: Boosting Opportunities for Small Startups Act

Bill Text

2025-2026 Bill 4089 Text of Previous Version (Feb. 25, 2025) - South Carolina Legislature Online 

South Carolina General Assembly
126th Session, 2025-2026

Bill 4089

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 ENACTING THE "BOOSTING OPPORTUNITIES FOR SMALL STARTUPS (BOSS) ACT" BY 
ADDING SECTION 12-6-532 SO AS TO PROVIDE FOR CERTAIN EXEMPTIONS FROM THE CORPORATE 
INCOME TAX FOR CERTAIN SMALL BUSINESSES.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 
1. This act may 
be cited as the "Boosting Opportunities for Small Startups (BOSS) Act."

SECTION 2. Article 5, Chapter 6, Title 12 
of the S.C. Code is amended by adding:

 Section 
12-6-532. (A) As used in this 
section:

 (1) "Startup" means a newly established 
business entity that has been in operation for no more than twenty-four months 
from the date of incorporation or registration within this State.

 (2) "Small business" means a business 
entity that:

 (a) employs no more than fifty 
full-time employees at the time of registration; and

 (b) generates less than three million 
dollars in gross annual revenue.

 (3) "Eligible business" means any 
startup or small business that meets the qualifications outlined in subsection 
(B).

 (4) "Corporate tax liability" means the 
amount of corporate income tax a business is obligated to remit pursuant to 
Section 12-6-530.

 (B) To qualify for the provisions in 
subsection (C), a business must:

 (1) be a newly established entity 
incorporated or registered within this State by January 1, 2027;

 (2) operate as a legal entity pursuant 
to state law;

 (3) generate annual gross revenue of 
less than three million dollars during the first two years of operation;

 (4) employ fewer than fifty full-time 
employees at the time of registration;

 (5) not be a subsidiary, affiliate, or 
joint venture of an established company with existing operations in this State; 
and

 (6) submit annual reports demonstrating 
eligibility, including proof of employment levels, revenue, and business 
operations.

 (C)(1) An eligible business is exempt from 
the state corporate income tax imposed pursuant to Section 12-6-530 for the 
first two income tax years beginning in the tax year after its incorporation or 
registration. An eligible business shall continue to meet the eligibility 
requirements throughout the first two income tax years to remain exempt.

 (2) An eligible business is liable for 
the state corporate income tax imposed pursuant to Section 12-6-530 in the 
following amounts:

 (a) in the third year of operation, 
twenty-five percent of the state corporate income tax rate;

 (b) in the fourth year of operation, 
fifty percent of the state corporate income tax rate;

 (c) in the fifth year, seventy-five 
percent of the state corporate income tax rate; and

 (d) in all years after the fifth year, 
one hundred percent of the state corporate income tax rate.

 (D)(1) A business found to be abusing or 
misrepresenting its status to qualify for the provision of subsection (C) is 
subject to the following penalties:

 (a) immediate termination of the 
benefits provided in subsection (C);

 (b) full repayment of any tax benefits 
received, plus interest and penalties; and

 (c) ineligibility for any future state 
tax relief programs for a period of ten years.

 (2) The following entities are 
explicitly excluded from provisions of subsection (C):

 (a) a business that was previously 
registered or operational under a different name or entity;

 (b) a company that transfers assets to 
a newly formed entity in order to qualify for the provisions of subsection (C); 
and

 (c) a large corporation establishing 
subsidiaries or spin-offs to exploit the provisions of subsection (C).

 (E) The Department of Revenue, in 
conjunction with the Department of Economic Development, shall submit a report 
to the General Assembly evaluating the effectiveness of this section no later 
than January 1, 2035. The report must include the number of businesses that 
have taken advantage of the provisions of subsection (C), the impact on job 
creation and economic growth, and recommendations for extending, amending, or 
terminating this section.

SECTION 
3. If any section, subsection, paragraph, 
subparagraph, sentence, clause, phrase, or word of this act is for any reason 
held to be unconstitutional or invalid, such holding shall not affect the 
constitutionality or validity of the remaining portions of this act, the 
General Assembly hereby declaring that it would have passed this act, and each 
and every section, subsection, paragraph, subparagraph, sentence, clause, 
phrase, and word thereof, irrespective of the fact that any one or more other 
sections, subsections, paragraphs, subparagraphs, sentences, clauses, phrases, 
or words hereof may be declared