South Carolina DOR Issues Draft Revenue Ruling on Retirement Income Deduction for COVID-Related Distributions

The South Carolina Department of Revenue Sept. 1 issued a draft revenue ruling on a retirement income deduction for COVID-related distributions from retirement plans under Section 2202 of the Coronavirus Aid, Relief, and Economic Security Act and the impact on the deduction claimed if the distributions are fully or partially repaid in a direct nontaxable transfer. The state conforms with the federal provision but doesn’t impose a penalty for premature distribution. Because the distributions aren’t subject to an early withdrawal penalty under the Internal Revenue Code, the distributions from qualified retirement plans meeting the requirements of S.C. Code Ann. Section ...