South Carolina Income Tax Credit for Hiring a Veteran Apprentice

This is an employer credit, not a payment to the veteran, and it is in the catalog because it is the practical reason a South Carolina apprenticeship sponsor will prefer a recently separated veteran, and because it is about to close. Section 12-6-3720 allows a tax credit for any taxpayer that hires a veteran of the Armed Forces of the United States, "after 2021 but before 2027", as a new employee in a registered apprenticeship program that has been validated by the United States Department of Labor. The amount is three thousand dollars for each eligible employee in the first year in which the credit is earned, two thousand five hundred dollars in the second year, and one thousand dollars in the third. It may not be claimed beyond the third year. The credit is earned late, not on hire. Subsection (D)(1): "The tax credit is earned in the year in which the veteran first completes the twelfth consecutive month of employment with the taxpayer", and on the same schedule in the second and third years. An employer that hires in October earns nothing that tax year. The closing date is the part to plan around. Subsection (E) limits the credit to a veteran hired "after 2021 but before 2027", and then preserves the tail: "If the individual is employed before 2027, then the employer may claim the credit for each year the individual is eligible and on the same schedule as provided in this section." So a veteran hired in December 2026 still generates the full three-year run, and a veteran hired in January 2027 generates nothing unless the General Assembly extends the section. For a veteran negotiating an apprenticeship start date, that is worth knowing. The definition of veteran in subsection (H)(2) is narrower than the word suggests and it is time-limited: "a person who served on active duty in the Armed Forces of the United States and who, within three years of being hired in a qualifying apprenticeship program, was honorably discharged or released from such service due to a service-connected disability." Unpack it. Active duty service is required, so a Guard or reserve member who never served on active duty is out. The discharge must be honorable, or the release must have been due to a service-connected disability. And the discharge or release must have happened within three years of the hire. A veteran four years out of uniform does not generate the credit no matter how well qualified. There is no rating threshold anywhere in the section, and no disability is required on the honorable discharge route. Subsection (G) closes the retroactivity: nothing in the section allows an employer to claim the credit for a veteran hired before the section's effective date. The credit runs against the taxes listed in subsection (B), which are the income taxes and license fees in Title 12 that this credit chapter reaches, and the Department of Revenue may promulgate regulations to administer it.