South Carolina Code § 117-1860.1. — Licensed Automotive Vehicles and Airplanes.
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(Unannotated)
Current through State Register Volume 29, Issue 10, effective October 28, 2005.
This regulation database is current through State Register Volume 29, Issue 10, effective October 28, 2005. Changes to the regulations enacted by the 2006 General Assembly, which will convene in January 2006, will be incorporated as soon as possible. Some regulations approved by the 2006 General Assembly may take immediate effect. The State of South Carolina and the South Carolina Legislative Council make no warranty as to the accuracy of the data, or changes which may have been enacted since the 2005 Regular Session or which took effect after this database was prepared and users rely on the data entirely at their own risk.
(Statutory Authority: 1976 Code Sections 12-4-320, 12-4-520, 12-7-70, 12-9-130, 12-19-130, 12-21-10, 12-21-120, 12-21-1090, 12-21-1840, 12-21-2810, 12-21-2798, 12-23-40, 12-27-820, 12-29-20, 12-33-70, 12-36-2120, 12-37-11, 12-37-910, 12-43-210 to 12-43-310, 38-5-430, 52-15-370, 61-9-850)
Statutory Authority: 1976 Code Sections 12-4-320, 12-4-520)
117-1 to 117-2. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-3 to 117-5. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-3 to 117-5. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-3 to 117-5. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-6 to 117-7. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-6 to 117-7. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-8. Responsibilities of the Department of Revenue with Respect to Property Taxation and Fees in Lieu of Property Taxes.
(Statutory Authority: 1976 Code Section 12-4-320)
117-8.1 Purpose
This regulation seeks to clarify the jurisdiction of the Department of Revenue with respect to property taxation and fees in lieu of property taxes, to establish a set of agreed upon procedures the Department of Revenue will follow in referring matters to the Office of the Comptroller General and in administering its respective area of responsibility, and to establish a guide for county officials to use in interacting with the Department of Revenue on these subjects. These guides and procedures are not intended to be all inclusive and are intended to cover only those areas where doubt has existed between the two agencies and with the local officials. The further purpose of this regulation is to improve the services of the Department of Revenue to the public and to the local county officials who are subject to its supervision. A further goal is to provide consistent, accurate and timely advice to those officials who depend upon this information in order to perform their duties pursuant to law and to be able to deal with the public in a consistent manner.
117-8.2 Department of Revenue Jurisdiction over Functions
A. General Information
Generally speaking, the Department of Revenue (Department or DOR) has jurisdiction over the duties involved with the proper assessment of property for tax purposes and the proper calculation of property taxes, while the Comptroller General supervises the collection of taxes and penalties, and administers the Homestead Tax Exemption Program, including the exemption from school operations found in Section 12-37-251, except for those functions specifically reserved to the DOR.
B. Section 12-4-520
Section 12-4-520 outlines in general terms the area of responsibility granted to the DOR by the General Assembly. Subsections (1) and (2) of that section grant DOR jurisdiction over assessors and county boards of tax appeal. Subsection (3) grants DOR jurisdiction over the assessment and equalization functions. It includes jurisdiction over the "taxation" of property and DOR is granted the power to investigate and take necessary action to insure that those functions are carried out properly. To the extent that it may not have been impliedly repealed, subsection (4) also states that the DOR, as often as annually, shall examine all the books, papers and accounts of assessors, auditors, treasurers and tax collectors, with a view to protecting the interests of the state, counties, and other political subdivisions and rendering these offices aid or instruction.
C. "Gray" Areas
There are "gray" areas as to when the assessment of property for tax purposes and the proper calculation of property taxes ends (DOR) and the collection jurisdiction (Comptroller General) begins. These areas which are not clearly assigned by the statutes are divided by agreement between the two agencies. This regulation formalizes how DOR will handle these issues.
D. Procedure in "Gray Areas"
If a question arises, and it is unclear under the terms of this agreement, or by statute, as to whom the question should be directed, the following applies: (1) if the question involves an assessor or the functions of the assessor, the question will be handled by DOR; (2) if the question involves the duties of the auditor, treasurer, or tax collector, the DOR will first refer the matter to the Comptroller General.
117-8.3 Handling of Matters Within DOR's Jurisdiction
A. Questions and Complaints.
When DOR has jurisdiction over the function complained of or questioned, it will address the complaint or answer the question received from a county official.
B. Areas under the Jurisdiction of DOR.
1. Refunds, except for Homestead Exemption, manufacturers' depreciation reimbursement, and exemption from school operations (Sections 12-37-250, 12-37-935, and 12-37-251).
2. Abatements (except for nulla bona actions under Section 12-49-85 and the Homestead Exemption under Section 12-37-250 and the exemption from school operations under 12-37-251).
3. Penalties and interest where DOR has assessment jurisdiction, other than penalties and interest for late payments collected by the counties. (Section 12-37-250 and 12-37-251).
4. Motor Carrier tax collections. (Section 12-37-2810 through 12-37-2880.)
5. Determination of the 80% for property under appeal. (Section 12-60-2550.)
6. Millage and assessment ratios
7. Tax Bills and Notices
8. Exemptions, other than the Homestead Exemption and the exemption from school operations (Sections 12-37-250 and 12-37-251).
9. Extension of time for the performance of the duties imposed upon the assessors and auditors for the valuation of property for tax purposes, unless specific statutory provisions indicate otherwise. (Section 12-4-520(6).)
10. Postponement of the time for the imposition of penalties, when the Comptroller General extends the time for the collection of taxes. (Section 12-4-520(6).)
11. Supervisory authority over the values to be placed upon the duplicate: Tax Map Numbers, assessments and valuations, millage computation processes, exemptions - except those administered by the Comptroller General - assessment ratios and other required data. Sections 12-4-520, 12-4-530, 12-39-260, and Regulation 117-117.
C. Duties of County Auditors that DOR will refer to the Comptroller General.
1. Continuing education requirements. Section 12-39-15.
2. Completion of county tax books and opening date. Sections 12-39-140 and 12-39-150.
3. Compiling the duplicate and the form of the duplicate. Sections 12-39-150, 190, 200.
4. Nulla Bona actions. Section 12-49-85.
5. The Homestead Tax Exemption Program (Section 12-37-250 et seq., to include Section 12-37-251, except for those functions in Section 12-37-251 reserved to the Department of Revenue);
6. Annual tax reports. Sections 12-39-140 and 12-45-300.
7. Forfeited Land Commission. Section 12-51-55.
D. Duties of County Treasurers that DOR will refer to the Comptroller General
1. Media of payment of taxes. Section 12-45-90.
2. Apportionment of taxes and costs. Sections 12-45-140 through 170.
3. Time for the payment or collection of taxes. Sections 12-45-70 and 12-4-520(6).
4. Collections and executions. Section 12-45-180.
5. Annual tax reporting. Section 12-45-300.
6. Treasurers' and tax collectors' delegation of duty to seize property. Section 12-45-400.
7. Partial and installment payments and application of payments of delinquent taxpayers. Sections 12-45-410 and 12-45-75.
8. Enforced collections. Generally Chapters 49 and 51 of Title 12.
9. Penalties and interest, except for those instances under DOR responsibility.
10. Homestead tax exemptions. Section 12-37-250 through 12-37-295, including the exemption from school operations in Section 12-37-251, except for those functions in Section 12-37-251 specifically reserved to the Department of Revenue.
11. Business inventory tax and manufacturers depreciation reimbursements. Section 12-37-450 and Section 12-37-935.
12. The collection of Motor Vehicle Taxes, other than Motor Carrier taxes. (The Department of Revenue is charged with all aspects of the collection of motor carrier property taxes. Sections 12-37-2810 through 2880.)
13. County treasurers' continuing education requirements. Section 12-45-15.
14. Forfeited Land Commission. Section 12-59-10.
E. Procedures.
The procedures to be used by DOR are as follows:
Upon receipt of letter or call requesting information:
(1) Determine if inquiry is under jurisdiction of DOR;
(2) Refer inquiry to the Comptroller General when it is the appropriate agency; and
(3) All responses under DOR's jurisdiction will be made by DOR, with a copy to the Comptroller General.
117-10 to 117-12. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-10 to 117-12. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-10 to 117-12. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-20 to 117-21. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-20 to 117-21. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-30 to 117-31. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-30 to 117-31. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-32, 117-33. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-32, 117-33. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-34, 117-35. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-34, 117-35. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-36, 117-37. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-36, 117-37. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-38. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-39 to 117-43. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-39 to 117-43. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-44. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-45. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-45.1. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-45.2. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-46. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-48. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-49. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-50. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-51. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-51.1. Repealed by State Register Volume 21, Issue No. 6, Part 2, eff June 27, 1997.
117-60. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-61 to 117-74. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-61 to 117-74. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-61 to 117-74. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-75 to 117-77. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-75 to 117-77. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-75 to 117-77. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-78. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-79, 117-80. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-79, 117-80. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-80.5 to 117-81. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-80.5 to 117-81. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-82. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-83. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
117-84 to 117-86. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-84 to 117-86. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-84 to 117-86. Repealed by State Register Volume 26, Issue No. 6, Part 2, eff June 28, 2002.
117-87.5 to 117-87.32. Repealed by State Register Volume 27, Issue No. 6, Part 2, eff June 27, 2003.
(Statutory Authority: 1976 Code Sections 12-4-320, 12-4-560, 12-37-110, 12-37-910, 12-43-210 to 12-43-310)
Section 1: Purpose: Section 12-43-230(c) that the Tax Commission shall provide by regulation a definition for real and personal property. This regulation is therefore adopted pursuant to this section so as to provide for a definition to be used by the Tax Commission and other assessing officials in connection with the assessment of property.
Section 2: For the purpose of classifying property for taxation, land, buildings and items of property devoted primarily to the general use of the land and buildings, and all other property which according to custom has been considered to be real property, are defined as real property; and all other items of property are defined as personal property. The following items are hereby classified as real property for purposes of taxation:
Land Improvements--Real: Retaining walls, piling and mats for general improvement of site, private roads, walks, paved areas, culverts, bridges, viaducts, subways and tunnels, fencing, reservoirs, dykes, dams, ditches and canals, drainage, storm and sanitary sewers, water lines for drinking, sanitary and fire protection.
Fixed river, lake or tidewater wharves and docks.
Permanent standard gauge railroad trackage, bridges and trestles.
Walls forming storage yards and fire protection dykes.
Buildings--Real: Structural and other improvement to buildings, including their foundations, walls, floors, roof, insulation, stairways, partitions, loading and unloading platforms and canopies, areaways, systems for heating and air conditioning, ventilating, sanitation, fixed fire protection, lighting, plumbing, and drinking water, building elevators and escalators.
Listed below are miscellaneous items which are identified as to their classification as to whether they are real or personal property. This list is not intended to be all inclusive.
Air Conditioning--Building air conditioning, including refrigeration equipment, for comfort of occupants--Real
Air Conditioning--Window units and Package units--Personal Property
Air Conditioning--for special process to maintain controlled temperature and humidity--Personal Property
Aircraft--Personal Property
Aluminum pot lines--Personal Property
Ash handling system, pit and superstructure (See Boilers)
Asphalt mixing plant--Personal Property
Auto-Call and telephone system--Personal
Automobile--Personal
Bins--permanently affixed bins for storage--Real
Boats--Personal
Boilers--for service of building--Real
Boilers--for service of building and manufacture with primary use for manufacture--Personal
Booths for welding--Personal
Bucket Elevators--Open or enclosed (including casing)--Personal
Bulkheads--making additional land area to be assessed with as part of the improved land
Building--special constructed building--Real
Cistern--Real
Coal handling systems (see Boilers)
Cold storage--built-in cold storage rooms--Real
Cold storage refrigeration equipment--Personal
Control Booth--Personal
Conveyor or housing, structure or tunnels--Real
Conveyor unit including belt and drives--Personal
Coolers--portable walk-in coolers--Personal
Cooling towers--primary use of manufacture--Personal
Cooling towers--primary use for building--Real
Crane-moving crane--Personal
Crane runways including supporting columns or structure--Inside or outside of building--Real
Crane runways--bolted to or hung on tresses--Personal
Dock levelers--Personal
Drying rooms structure--Real
Drying rooms heating systems--Personal
Dust Catchers--Personal
Farm Equipment--Personal
Fire alarm system--Personal
Fire walls--masonry--Real
Foundations for machinery & equipment--Personal
Furniture & fixtures of commercial establishments and professional--Personal
Gasoline tanks--see tanks
Greenhouse--Real
Greenhouse--Benches & heating system--Personal
Gravel Plant--machinery & equipment--Personal
Hoist Pits--see pits
Houses and sheds--portable or on skids--Personal
Inventory of merchants--Personal
Kilns--lumber drying kiln structure--Real
Kilns--concrete block drying kiln structure--Real
Kilns--circular down draft (Beehive)--Real
Kilns--heating or drying system--Personal
Laundry steam generating equipment--Personal
Lighting--Yard lighting--Real
Lighting--special purpose--Personal
Lighting--service stations (Except bldg.)--Personal
Mixers and mixing houses--Personal
Mobile Homes--Real
Monorail Crane runways--Personal
Motors, outboard and inboard boat--Personal
Moveable structures--Personal
Ore bridge foundation--Real
Ovens--processing--Personal
Piping--process piping above or below ground--Personal
Pits for equipment or processing--Personal
Power lines and auxiliary equipment--Personal
Pumps and Motors--Personal
Pump House (Including sub-structure)--Real
Racks and shelving (Portable or removable)--Personal
Ready-mix concrete plant--Personal
Recreational Vehicles--Personal
Refrigeration Equipment (See Air Conditioning)--Personal
Sanitary System--Real
Scale houses--Real
Scales--Truck or Railroad Scales including Pit--Real
Scales--Dormat Scales--Personal
Silos--all storage silos--Real
Silos--containing a manufacturing process--Personal
Spray Ponds--masonry reservoir--Real
Spray Pond piping and equipment--Primary use classification
Sprinkler System--Real
Stacks--mounted on boilers (see boilers)
Stacks, chimneys--concrete or masonry--Real
Stacks, steel--supported individually and servicing heating boilers--Real
Stacks, steel servicing personal property units or a process--Personal
Steam electric generating plant & equipment--Personal
Stone crushing plant--machinery & equipment--Personal
Storage bins, small portable--Personal
Storage facilities permanent, of masonry or wood--Real
Storage vaults and doors including bank vaults and doors--Real
Substation Building--Real
Substation--Equipment--Personal
Tanks--all storage tanks above or below ground--Real
Tanks--used as a manufacturing process--Personal
Tanks--underground gasoline tanks at service station--Personal
Tipple Structure--Personal
Towers--Transmission--Personal
Towers--TV or Radio broadcasting--Personal
Trucks--Personal
Tunnels--Real
Tunnels--waste heat or processing--Personal
Unit Heaters--Real
Unloader Runway--Real
Vaults, bank--Real
Ventilating--Real
Ventilating system for manufacturing equipment--Personal
Water lines--for process above or below ground--Personal
Water pumping station--building and structure--Real
Water pumps and motors--Personal
Water treating and softening plant building and structure--Real
Water treating and softening equipment--Personal
Wells, pumps, motors and equipment--Personal
Wiring--Power wiring--Personal
(Statutory Authority: 1976 Code Section 12-36-2120)
(Statutory Authority: 1976 Code Section 12-4-320)
Code Section 12-54-210 requires all taxpayers to keep books and records as the South Carolina Department of Revenue may prescribe. Code Section 12-54-100 authorizes the Department to examine the books and records of a taxpayer to ascertain the correctness of any return or tax liability. The following concerns the recordkeeping requirements of a taxpayer.
A person applying for or holding a license administered by the Department; liable for any tax, fee, or surcharge administered by the Department; or required to file any return or statement with the Department shall keep books, papers, memoranda, and records sufficient to establish the right to obtain or hold a license; any amount required to be shown on any return or statement; or any tax, fee or surcharge due, whether such amount due is paid with the filing of a return, electronically, or in any other manner. For purposes of this subsection, a return includes information returns or reports.
Such books or records are required to be kept at all times available for inspection by agents or auditors of the Department, and shall be retained for at least four years after the return was filed or due to be filed, whichever is later.
Only on prior written approval of the Department may microfilm reproductions of supporting records of details, such as but not limited to documents of original entry, purchase orders, invoices, checks, vouchers and payroll records, be retained in lieu of actual documents and then only when the following conditions are met:
1. The taxpayer will retain microfilm copies as long as the contents thereof may become material in the administration of any law by the Department;
2. The taxpayer will provide appropriate facilities for preservation of the films and for the ready inspection and location of the particular records, including a projector for viewing the records in the event inspection is necessary; and
3. The taxpayer will be ready to make any transcripts of the information contained on the microfilm which may be required.
(A) The purpose of this regulation is to define the requirements imposed on taxpayers for the maintenance and retention of books, records, and other sources of information under Code Section 12-54-210. It is also the purpose of this regulation to address these requirements where all or a part of the taxpayer's records are received, created, maintained, or generated through various computer, electronic, and imaging processes and systems.
(B) For the purposes of this regulation, these terms shall be defined as follows:
(1) "Database management system" means a software system that controls, relates, retrieves, and provides accessibility to data stored in a database.
(2) "Electronic data interchange" or "EDI technology" means the computer-to-computer exchange of business transactions in a standardized structured electronic format.
(3) "Hardcopy" means any documents, records, reports, or other data printed on paper.
(4) "Machine-sensible record" means a collection of related information in an electronic format. Machine-sensible records do not include hardcopy records that are created or recorded on paper or stored in or by an imaging system such as microfilm, microfiche, or storage-only imaging systems.
(5) "Storage-only imaging system" means a system of computer hardware and software that provides for the storage, retention, and retrieval of documents originally created on paper. It does not include any system, or part of a system, that manipulates or processes any information or data contained on the document in any manner other than to reproduce the document in hardcopy or as an optical image.
(6) "Taxpayer" as used in this regulation means a person who is liable for a tax or who is responsible for collecting and remitting a tax. "Taxpayer" includes any licensee and any applicant for a license, issued by or administered by the Department.
(7) "Department" means the South Carolina Department of Revenue.
(C)(1) Pursuant to Code Section 12-54-210, a taxpayer shall maintain all records that are necessary to a determination of the correct tax liability under laws administered by the Department. All required records must be made available on request by the Department or its authorized representatives as provided for in Code Sections 12-54-100 and 12-4-330(A).
(2) If a taxpayer retains records required to be retained under this regulation in both machine-sensible and hardcopy formats, the taxpayer shall make the records available to the Department in machine-sensible format upon request of the Department pursuant to Code Sections 12-54-100 and 12-4-330(A).
(3) Nothing in this regulation shall be construed to prohibit a taxpayer from demonstrating tax compliance with traditional hardcopy documents or reproductions thereof, in whole or in part, whether or not such taxpayer also has retained or has the capability to retain records on electronic or other storage media in accordance with this regulation. However, this provision shall not relieve the taxpayer of the obligation to comply with this subsection.
(D)(1) Machine-sensible records used to establish tax compliance shall contain sufficient transaction-level detail information so that the details underlying the machine-sensible records can be identified and made available to the Department upon request. A taxpayer has discretion to discard duplicated records and redundant information provided its responsibilities under the law are met.
(2) At the time of an examination, the retained records must be capable of being retrieved and converted to a standard record format.
(3) Taxpayers are not required to construct machine-sensible records other than those created in the ordinary course of business. A taxpayer who does not create the electronic equivalent of a traditional paper document in the ordinary course of business is not required to construct such a record for tax purposes.
(E)(1) Where a taxpayer uses electronic data interchange processes and technology, the level of record detail, in combination with other records related to the transactions, must be equivalent to that contained in an acceptable paper record. For example, the retained records should contain such information as vendor name, invoice date, product description, quantity purchased, price, amount of tax, indication of tax status, shipping detail, etc. Codes may be used to identify some or all of the data elements, provided that the taxpayer provides a method which allows the Department to interpret the coded information.
(2) The taxpayer may capture the information necessary to satisfy section (E)(1) at any level within the accounting system and need not retain the original EDI transaction records provided the audit trail, authenticity, and integrity of the retained records can be established. For example, a taxpayer using electronic data interchange technology receives electronic invoices from its suppliers. The taxpayer decides to retain the invoice data from completed and verified EDI transactions in its accounts payable system rather than to retain the EDI transactions themselves. Since neither the EDI transaction nor the accounts payable system captures information from the invoice pertaining to product description and vendor name (i.e., they contain only codes for that information), the taxpayer also retains other records, such as its vendor master file and product code description lists and makes them available to the Department. In this example, the taxpayer need not retain its EDI transaction for tax purposes.
(F) The requirements for an electronic data processing accounting system should be similar to that of a manual accounting system, in that an adequately designed accounting system should incorporate methods and records that will satisfy the requirements of this law.
(G)(1) Upon the request of the Department, the taxpayer shall provide a description of the business process that created the retained records. Such description shall include the relationship between the records and the tax documents prepared by the taxpayer and the measures employed to ensure the integrity of the records.
(2) The taxpayer shall be capable of demonstrating:
(a) the functions being performed as they relate to the flow of data through the system;
(b) the internal controls used to ensure accurate and reliable processing; and,
(c) the internal controls used to prevent unauthorized addition, alteration, or deletion of retained records
(3) The following specific documentation is required for machine-sensible records retained pursuant to this regulation:
(a) record formats or layouts;
(b) field definitions (including the meaning of all codes used to represent information);
(c) file descriptions (e.g., data set name);
(d) detailed charts of accounts and account descriptions.
(H)(1) It is recommended but not required that taxpayers refer to the National Archives and Record Administration's (NARA) standards for guidance on the maintenance and storage of electronic records, such as the labeling of records, the location and security of the storage environment, the creation of back-up copies, and the use of periodic testing to confirm the continued integrity of the records. [The NARA standards may be found at 36 Code of Federal Regulations, Part 1234, July 1, 1995 edition.]
(2) The taxpayer's computer hardware or software shall accommodate the extraction and conversion of retained machine-sensible records.
(I)(1) The manner in which the Department is provided access to machine-sensible records as required in subsection (C)(2) of this regulation may be satisfied through a variety of means that shall take into account a taxpayer's facts and circumstances through consultation with the taxpayer.
(2) Such access will be provided in one or more of the following ways:
(a) The taxpayer may arrange to provide the Department with the hardware, software, and personnel resources to access the machine-sensible records;
(b) The taxpayer may arrange for a third party to provide the hardware, software, and personnel resources necessary to access the machine-sensible records;
(c) The taxpayer may convert the machine-sensible records, including copies of files, to a standard record format specified by the Department on a magnetic medium that is agreed to by the Department;
(d) The taxpayer and the Department may agree on other means of providing access to the machine-sensible records.
(J)(1) In conjunction with meeting requirements of subsection (D), the taxpayer may create files solely for the use of the Department. For example, if a database management system is used, it is consistent with this regulation for the taxpayer to create and retain a file that contains the transaction-level detail from the data-base management system and that meets the requirements of subsection (D). The taxpayer should document the process that created the separate file to show the relationship between that file and the original records.
(2) A taxpayer may contract with a third party to provide custodial or management services of the records. Such a contract shall not relieve the taxpayer of its responsibilities under the law or this regulation.
(K)(1) For purposes of storage and retention, taxpayers may convert hardcopy documents received or produced in the normal course of business and required to be retained under this regulation to microfilm, microfiche or other storage-only imaging systems and may discard the original hardcopy documents provided the conditions of this regulation are met. Documents that may be stored on these media include, but are not limited to, general books of account, journals, voucher registers, general and subsidiary ledgers, and supporting records of details such as sales invoices, purchase invoices, exemption certificates, and credit memoranda.
(2) Microfilm, microfiche, and other storage-only imaging systems shall meet the following requirements:
(a) Documentation establishing the procedures for converting the hardcopy documents to microfilm, microfiche, or other storage-only imaging systems must be maintained and made available on request. Such documentation shall, at a minimum, contain a sufficient description to allow an original document to be followed through the conversion system as well as internal procedures established for inspection and quality assurance.
(b) Procedures must be established for the effective identification, processing, storage, and preservation of the stored documents and for making them available for the period they are required to be retained.
(c) Upon request by the Department, a taxpayer must provide facilities and equipment for reading, locating, and reproducing any documents maintained on microfilm, microfiche, or other storage-only imaging systems.
(d) When displayed on such equipment or reproduced on paper, the documents must exhibit a high degree of legibility and readability. For this purpose, legibility is defined as the quality of a letter or numeral that enables the observer to identify it positively and quickly to the exclusion of all other letters or numerals. Readability is defined as the quality of a group of letters or numerals being recognizable as words or complete numbers.
(e) All data sorted on microfilm, microfiche, or other storage-only imaging systems must be maintained and arranged in a manner that permits the location of any particular record.
(f) There is no substantial evidence that the microfilm, microfiche, or other storage-only imaging system lacks authenticity or integrity.
(L)(1) Except as otherwise provided in this regulation, the provisions of this regulation do not relieve taxpayers of the responsibility to retain hardcopy records that are created or received in the ordinary course of business as required by existing law and regulations. Hardcopy records may be retained on a recordkeeping medium as provided in subsection (K) of this regulation.
(2) If hardcopy records are not produced or received in the ordinary course of transacting business (e.g., when the taxpayer uses electronic data interchange technology), such hardcopy records need not be created.
(3) Hardcopy records generated at the time of a transaction using a credit or debit card must be retained unless all the details necessary to determine correct tax liability relating to the transaction are subsequently received and retained by the taxpayer in accordance with this regulation. Such details include those listed in subsection (E)(1).
(4) Computer printouts that are created for validation, control, or other temporary purposes need not be retained.
(5) Nothing in this regulation shall prevent the Department from requesting hardcopy printouts in lieu of retained machine-sensible records at the time of examination.
(M) The Department may allow a taxpayer to use other methods of maintaining and providing records that are received, created, maintained, or generated through various computer, electronic, and imaging processes and systems where such is in the best interest of the state.
Any person required to make a return, statement, or document to the South Carolina Department of Revenue shall include in such return, statement, or other document such identifying numbers as may be prescribed for securing proper identification of such person.
Section 1. For purposes of this regulation the words terms and phrases when used herein shall have the meaning ascribed thereto.
(a) A "taxpayer" is a person, firm, corporation or other entity with respect to whose income, sales or business the summons is issued.
(b) A "third party" is the person, firm, corporation or other entity upon whom the summons is served, other than:
1. a taxpayer; or
2. an officer, employee, agent, accountant, or attorney of a taxpayer who, at the time the summons is served, is acting as such.
(c) "Third party records" are books, papers, records or other information in which the taxpayer has no proprietary interest at the time the summons is served.
(d) "Directly incurred costs" are those incurred solely, immediately and necessarily as a consequence of searching for, reproducing or transporting records in order to comply with a summons. Proportionate allocation of fixed costs (overhead, equipment depreciation, etc.) is not considered to be directly incurred. However, where a third party's records are stored at an independent storage facility that charges the third party a fee to search for, reproduce or transport particular records requested, such fees are considered to be directly incurred by the summoned third party.
(e) "Search Costs" include only the amount of time incurred in locating and retrieving records or information.
(f) "Reproduction Costs" are those incurred in making copies or duplicates of summoned documents, transcripts and other similar material.
(g) "Transportation Costs" are limited to:
1. Costs incurred to transport personnel to locate and retrieve records or information requested; and
2. Costs incurred solely by the need to convey the summoned material to the place of examination.
Section 2. A third party in compliance with a summons is entitled to payment as herein provided for directly incurred costs for searching, reproducing or transporting such party's records, books or papers. The payment shall be in accordance with the following:
1. For reproduction costs
(a) ten (10) cents for each page reproduced;
(b) the actual cost of each photograph, film, or other material reproduced.
2. For search costs
The amount of Five (5) Dollars per hour;
3. For transportation costs
The actual costs.
No payment will be made, however, until the third party satisfactorily complies with the summons and submits an itemized bill reflecting a specific accounting for the search, reproduction and transportation costs. The payment shall be made only to third parties and not to the taxpayer.
(Statutory Authority: 1976 Code Section 12-4-320)
As a condition precedent to doing business in this state, every retailer shall obtain a retail license for each retail outlet.
Every retailer making sales of tangible personal property for storage, use or other consumption in this state, who:
1. Maintains a place of business;
2. Qualifies to do business;
3. Solicits and receives purchases or orders by agent or salesman
must obtain from the department a retail license.
For the purpose of determining the licenses required by persons engaged in the business of operating vending or coin-operated machines dispensing cigarettes and soft drinks in closed containers in this state, each point from which the service for such machines or other tangible personal property originates, shall be considered to be a retail outlet and a retail license must be obtained for each such point of service.
The personal representative of the estate of a deceased licensed retailer may, upon filing with the department a certified copy of Letters Testamentary or Letters of Administration, as the case may be, and upon the approval of the department, continue the operation of the business covered by the license for purposes only of administering the estate.
A licensed retailer may, upon written application and approval by the department, have transferred his retail dealer's license from one location to another without incurring additional license tax liability. This rule is for application only in cases where there is an abandonment of the licensed business location and a simultaneous moving to a new location. The licensed retailer making application for transfer must surrender his license of original issue and indicate on the license the address of his new location.
Operators of fairs, carnivals and concessionaire at athletic stands and other public exhibitions sell tangible personal property from booths which they operate. These sales are subject to the tax which must be remitted by the operator who controls or directs the management of such booths. The single retail license shall cover sales of tangible personal property made from all stands under the immediate management or control of each operator. A separate license will not be required for each change of location provided the operator furnishes the department an itinerary giving a schedule of locations and dates.
Persons conducting games of chance or skills at fairs, carnivals, circuses and other public exhibitions who deliver merchandise as prizes are deemed consumers of such articles. Property for use as outlined above purchased from without the state is subject to the tax based upon the reasonable and fair market value thereof at the time and place where used. The term "reasonable and fair market value" shall mean the retail selling price of the particular property involved in the absence of affirmative proof to the contrary. The taxable event in such cases occurs at the time of withdrawal of such property for use as prizes or gifts. Purchases in this state, of tangible personal property to be used as gifts or prizes, are subject to the sales tax. The purchaser thereof must pay his supplier the tax.
When a partner drops out of a partnership during the year, it is not necessary for the surviving partner to purchase a new retail license to cover the remainder of the fiscal year.
The South Carolina sales and use tax law provides many exemptions from the tax for the agriculture industry. The exemptions are found in Code Section 12-36-2120 and include exemptions for livestock, feed, insecticides, chemicals, fertilizers, containers, labels, machinery, fuel, electricity, gas, and building materials. In order to obtain an exemption, all provisions of the exemption must be met. This regulation will explain these exemptions in more detail.
In many of the subsections of this regulation, examples of items exempt and not exempt are provided. These examples are not all inclusive.
The sale of livestock is exempt from the tax under Code Section 12-36-2120(4). Livestock is defined as domesticated animals customarily raised in South Carolina farms for use primarily as beasts of burden or food. Livestock also means mammals raised for their pelts or furs.
The practical result of the above is to exempt from the tax horses, mules, cattle, swine, sheep, goats, rabbits, ostriches and any other animals raised as food for human consumption, domesticated fish produced for human consumption, and chinchillas.
Animals such as dogs, cats, reptiles, fowls (excepts baby chicks and poults), minnows, worms, fish (excepts those cultivated for human consumption), and animals of a wild nature are not considered livestock.
The sale of feed used in the production and maintenance of livestock, as defined Regulation 117-301.1, is exempt from the tax under Code Section 12-36-2120(5). Horse feed, rabbit feed used in the production and maintenance of rabbits for human consumption, and feed used in the production and maintenance of fry, fingerlings and fish are exempt.
Insecticides, chemicals, fertilizers, soils conditioners, seeds and seedlings used solely in the production for sale of farm, grove, vineyard or garden products are exempt under Code Section 12-36-2120(6). This exemption includes:
(a) explosives (chemicals) used solely in the production for sale of farm, grove, vineyard or garden products.
(b) medicines (chemicals) used solely in the production for sale of livestock.
(c) insecticides, chemicals, fertilizers, soils conditioners, seeds and seedlings used solely in the production for sale of timber and timber products, nursery products, and poultry and poultry products.
(d) insecticides and chemicals, including washing powder, soap, etc., used by dairy operators at the dairy barn in the production for sale of products of the dairy.
(e) bull semen used solely in the production for sale of livestock.
This exemption does not apply to liquid petroleum gas used for burning grass and weeds around farm crops.
Containers and labels used in preparing agriculture products for sale and used in preparing turpentine gum, gum spirits of turpentine, and gum resins for sale are exempt under Code Section 12-36-2120(7). For the purposes of this exemption, "containers" means boxes, crates, bags, bagging, ties, barrels, and other containers.
This exemption applies to bags sold to:
(a) wholesale grain and feed dealers for use as furnished containers of corn and oats.
(b) cotton dealers or ginners for use as furnished containers of cotton seed.
(c) produce dealers for use as furnished containers of potatoes, cabbage, etc.
(d) peanut hullers for use as furnished containers of peanut kernals, hulls, and vines.
(e) nurserymen for use as furnished containers of nursery stock.
Wrapping paper, wrapping twine, paper bags, and containers, used incident to the sale and delivery of tangible personal property are exempt under Code Section 12-36-2120(14).
The above exemptions do not apply to tobacco twine used by farmers incident to the curing of tobacco.
The sale of farm machinery that is used in planting, cultivating or harvesting farms crops for sale is exempt under Code Section 12-36-2120(16). This exemption also applies to replacement parts and attachments. For purposes of this exemption, the terms "planting," "cultivating," and "harvesting" are defined as follows:
"Planting" includes all necessary steps in the preparation of the soil prior to, and including, the planting and sowing of the seed.
"Cultivating" includes the loosening of the soil around growing plants, control of moisture content in the soil, and weed and pest control.
"Harvesting" begins with the gathering of the crop and ends when the crop is placed in a temporary or permanent storage area. It also includes the additional preparation for storage or sale of certain crops such as the curing of tobacco, grains, and peanuts and the grading and packaging of peaches, cucumbers, tomatoes, etc.
The sale of bulk coolers (farm dairy tanks) used in the production and preservation of milk on dairy farms and machines used in the production of poultry and poultry products on poultry farms when such products are sold in the original state of production or preparation for sale are also exempt under Code Section 12-36-2120(16).
The following machines qualify for this exemption:
(a) machinery used in constructing terraces, drainage and irrigation ditches, dikes used to control the water level in cultivated fields, and land clearing prior to cultivation of the soil.
(b) machinery specially designed for irrigation purposes, including pumps, pipes, spigots, etc., when sold for use in the cultivation of farm crops.
(c) farms wagons used in planting, cultivating or harvesting farm crops.
(d) pasteurizing machines, cooling machines, mechanical separators, homogenizing machines and bottling machines used by dairies in the production of milk for sale. Milking machines do not come within the exemption for farm machinery.
(e) machines used in the production of poultry and poultry products for sale when incorporated into and made a part of an automated system. This includes automated bulk feed bins placed either inside or outside the building when such bins are connected to automatic feeding systems; the auger conveying feed from bulk feed bins to the automated feeder system; roll-up curtains (hand crank and motorized) to control light and room temperature; automatic chain feeders; auger and pan feeders; automatic waterers, valves, and accessories, brooders-all types, winching systems used to raise and lower brooders to control room temperature and also to facilitate cleaning; electric debeakers; egg washing machinery; egg grading machinery; egg candling machinery; time clocks for controlling lights or machinery; automated nests only; belt gathering systems for nests; laying cages when a part or attachment to an automated feeding and/or watering system; mechanically operated feed carts; bulk feed bodies (the vehicles on which these bodies are mounted are subject to the tax as well as nonmechanized carts); automatic clean-out systems for cage houses; small tractor or Bobcat used for clean-out of poultry houses; machinery used to cool eggs; humidifiers for egg rooms; auxiliary power generators; ventilation equipment for poultry houses (to include fans and motorized shutter assemblies); electric heat tapes (water warmers); monorail system for use in conveying eggs in process; automatic medication proportioners; incubators; scales used in loading mixing buggies to gauge the amount of feed per chicken; electric shockers and wire over automatic troughs; (electrified wire fences would be subject to the tax unless exempt under Section 12-36-2120(45)); vibrators; infrared brooders (heat lamps used primarily to brood quail); and incinerators.
Examples of properties not exempted from the tax under Section 12-36-2120(16) are building materials, fencing and fence posts, hand tools, range waterers and feeders (unless completely mechanized), egg baskets and stackers, hand trucks and nonmechanized egg carts, dollies, brooding paper and guards, nesting materials, boots, gloves, hand-operated sprayers and powder dusters, mouse traps (all types), leg bands, wing bands, and nest eggs. (Note: Some of these items may be exempt under Section 12-36-2120(45).)
(f) animal and motor drawn or operated implements such as plows, harrows, hay rakes, mowers, cultivators, and planters.
(g) machinery used in planting, cultivating, and harvesting timber products.
(h) tobacco curers (not including flues and furnaces).
(i) a flatbed trailer or a stock trailer used for hauling farm crops (i.e. hay, corn, peaches) if the flatbed trailer or stock trailer is used substantially in planting, cultivating, or harvesting such farm crops for sale in their original state of production or preparation for sale.
(j) animal and motor drawn or operated tobacco transplanters.
(k) portable power saws for use in planting, cultivating, or harvesting farm crops may be purchased free of the tax. The term "farm crops" includes forest products or products of the forests.
(l) skidders used in logging operations, when used either by sawmills or by contract loggers.
(m) machinery purchased by operators of commercial fisheries and used directly in fishing operations, such as motor operated watercraft and nets attached to booms or cranes for lowering into the sea bed.
(n) machinery purchased by commercial crabbers and used directly in crabbing operations, such as motors, mechanical capstans,