Daniel Prince
State withholding tax table adjustments may put more money in your pocket
When the new year begins, you may see a little more in your paycheck. The change is due to adjustments in the State Withholding Tax Tables due to the Comprehensive Tax Cut Act of 2022 passed by South Carolina lawmakers this summer. Most workers will see less state taxes withheld in next year’s paychecks. The top income tax rate has been reduced from 7% to 6.5% and could go lower in the future if certain general fund growth tests are met. The size of the change in withholding will depend on several factors, including how much each worker makes and how often they are paid. The change only affects how much state tax is withheld and has no bearing on federal tax withholding or anything else.
The state Department of Revenue advises taxpayers to check their withholding early each year, when the tax law has changed, or if they have experienced significant life changes, such as marriage, divorce, the birth of a child, a new job or raise, new taxable income not subject to withholding, or changes in itemized deductions or tax credits. If you owed money on your 2022 returns, changing withholding could head off a tax bill next year.