TL;DR: The federal $10,000 cap on state and local tax (SALT) deductions has been in place since 2018 and still shapes how homeowners calculate their real tax picture. South Carolina's lower property tax burden — backed by a statutory 4% assessment ratio on primary residences under SC Code § 12-43-220(c)(1) — means the cap affects Grand Strand buyers differently than those coming from high-tax states. But understanding how the rules stack together still matters when you're evaluating the full cost of owning here.
The Tax Question That Comes Up at Almost Every Closing
Property taxes. State income taxes. The mortgage interest deduction. For buyers evaluating a home purchase in the Myrtle Beach area, these line items are part of the real financial picture — not just talking points. And one federal rule has quietly shaped how much of that picture you can actually deduct.
Since 2018, the state and local tax deduction — commonly called the SALT deduction — has been capped at $10,000 per year for federal income tax purposes. That cap applies whether you're deducting property taxes alone, or a combination of property taxes and state income taxes. Eight years later, that limit is still the law.
Understanding how the SALT deduction works, where it falls short, and what it means for buyers considering a move to Horry County helps frame the broader cost-of-ownership conversation more accurately.
How the SALT Deduction Works — and What Changed in 2017
Before the Tax Cuts and Jobs Act (TCJA) took effect in 2018, homeowners could deduct the full amount of their state and local taxes paid each year from their federal taxable income. That included property taxes, state income taxes, and in some cases sales taxes. There was no ceiling.
The TCJA replaced that unlimited deduction with a hard cap: $10,000 total, or $5,000 for married taxpayers filing separately. According to the IRS, the SALT deduction falls under Schedule A itemized deductions. It remains available only to taxpayers who choose to itemize — meaning their total itemized deductions must exceed the applicable standard deduction to make itemizing worthwhile.
As of tax year 2025, the IRS standard deduction is $15,000 for single filers and $30,000 for married couples filing jointly. That means many homeowners — particularly those with more modest property tax bills — may find the standard deduction still exceeds what they could claim by itemizing, even with mortgage interest added in.
What qualifies under the SALT cap:
State and local property taxes on real property you own
State and local income taxes or general sales taxes (you must choose one)
Personal property taxes on assets like vehicles
What does not count:
Foreign property taxes
Property taxes related to your business (those go elsewhere on your return)
Fees charged for specific services, such as trash pickup or utility assessments
Consult with a licensed tax professional for guidance specific to your situation, as tax rules are subject to change.
What the SALT Cap Means for Buyers in the Myrtle Beach Market
Here's where the Horry County picture becomes relevant. South Carolina has a favorable property tax structure for primary residence owners — one grounded in state statute. Under SC Code § 12-43-220(c)(1), a legal residence is assessed at four percent of fair market value. Non-primary and investment properties are assessed at six percent. That lower ratio, applied to certified 2025 millage rates from the Horry County Auditor's office, produces annual property tax bills that typically fall well below the $10,000 SALT cap on their own.
According to CCAR MLS data (January 2026), the median home price in Horry County held steady at $310,000 in 2025, unchanged from 2024. Using the 4% legal residence assessment ratio and the 2025 certified total county and school millage of 171.2 mills for unincorporated Horry County (Horry County Auditor, certified July 29, 2025):
$310,000 × 4% = $12,400 assessed value $12,400 × 171.2 mills ÷ 1,000 = approximately $2,123 annually
For a property within the City of Myrtle Beach, the municipal levy of 83.4 mills applies on top of the county rate, bringing the combined millage to 254.6:
$12,400 × 254.6 mills ÷ 1,000 = approximately $3,157 annually
Both figures leave substantial room within the $10,000 SALT cap to also deduct a portion of SC state income taxes. According to the SC Department of Revenue's 2025 SC1040 Instructions (dor.sc.gov, August 2025), South Carolina's top marginal individual income tax rate for tax year 2025 is 6% — reduced from prior years as part of the state's legislated rate reduction schedule.
The practical takeaway: buyers relocating to the Grand Strand from high-property-tax states — where annual property taxes on comparable homes can easily exceed $10,000 on their own — often find South Carolina's tax environment meaningfully different. That said, itemizing still requires careful math against the standard deduction. A licensed tax advisor can run those numbers for your specific situation. Programs and rates are subject to change; verify current details.
The SALT Deduction, Itemizing, and the Mortgage Interest Deduction
The SALT deduction doesn't exist in isolation. For most homeowners who itemize, SALT is considered alongside the mortgage interest deduction — and how those two interact determines whether itemizing is worth it at all.
According to the IRS, mortgage interest on loans up to $750,000 (for loans originated after December 15, 2017) is deductible for taxpayers who itemize. For a buyer purchasing a $310,000 home in Horry County with a conventional loan and standard down payment, the annual mortgage interest can be a meaningful deduction — particularly in the early years of a loan when interest makes up a larger portion of each payment.
Here's how the deductions can stack for a Grand Strand buyer, using verified 2025 figures:
| Deduction Category | Verified 2025 Amount | Source / Notes |
|---|---|---|
| Property Taxes — Unincorporated Horry County (median-priced home) | ~$2,123/yr | SC Code § 12-43-220(c)(1); Horry County Auditor 2025 Tax Levy (171.2 mills) |
| Property Taxes — City of Myrtle Beach (median-priced home) | ~$3,157/yr | SC Code § 12-43-220(c)(1); combined millage 254.6 (county + city levy) |
| SC State Income Tax Deductible (up to SALT cap remainder) | Up to $7,877–$6,843 remaining under $10,000 cap | SC DOR 2025 SC1040 Instructions; top rate 6% for tax year 2025 |
| Mortgage Interest Deduction | Varies by loan amount and rate | IRS — loans up to $750,000; Schedule A |
| Standard Deduction (MFJ, 2025) | $30,000 | IRS — itemizing only beneficial if total exceeds this threshold |
Sources: SC Code § 12-43-220(c)(1) (scstatehouse.gov); Horry County Auditor, 2025 Certified Tax Levy (certified July 29, 2025); SC Department of Revenue, 2025 SC1040 Instructions (dor.sc.gov, August 2025); IRS (irs.gov). Property tax figures calculated using $310,000 Horry County median price per CCAR MLS (January 2026). Consult a licensed tax professional for calculations specific to your situation. Rates and programs subject to change.
The decision to itemize or take the standard deduction ultimately depends on your full financial picture. But for buyers considering a home purchase in the Myrtle Beach or broader Grand Strand area, understanding where the SALT cap sits — and how South Carolina's statutory tax structure compares nationally — is part of making an informed decision.
According to the NAR 2025 Profile of Home Buyers and Sellers, 46 percent of all buyers cited savings as a primary source of their home purchase financing. That number reflects how carefully buyers are weighing the full cost of ownership. Understanding the tax side of that equation is part of the same discipline.
If you have questions about how property taxes, deduction limits, or the overall cost of owning in Horry County factor into your decision, get in touch with the Carolina Crafted Homes team — we're glad to share what we know about the local market and connect you with the right resources.
FAQ SECTION
Q1: What is the SALT deduction cap and is it still in effect in 2026? Yes. The $10,000 cap on state and local tax deductions was established by the Tax Cuts and Jobs Act of 2017 and remains in effect as of 2026. It applies to the combined total of property taxes and either state income taxes or general sales taxes — not each separately. Married taxpayers filing separately face a $5,000 limit. According to the IRS, this deduction is only available to taxpayers who itemize on Schedule A, meaning it only reduces your tax bill if your total itemized deductions exceed the standard deduction for your filing status.
Q2: How does South Carolina's property tax structure compare to higher-tax states? South Carolina law (SC Code § 12-43-220(c)(1)) sets the assessment ratio for a primary residence at 4% of fair market value — compared to 6% for non-primary properties. At the 2025 Horry County median price of $310,000 (CCAR MLS, January 2026), applying the 4% ratio and the 2025 certified county and school millage of 171.2 mills produces an annual property tax of approximately $2,123 for unincorporated Horry County properties. That's well below the $10,000 SALT cap, in contrast to states where comparable homes routinely carry tax bills exceeding that threshold.
Q3: Can I deduct both property taxes and state income taxes in South Carolina? Yes, but the combined total is subject to the $10,000 federal SALT cap. Because Horry County property taxes on primary residences typically run in the $2,000–$3,200 range depending on location (Horry County Auditor, 2025 Tax Levy), buyers may have meaningful room within the cap to also deduct a portion of SC state income taxes. South Carolina's top marginal income tax rate for 2025 is 6%, per the SC Department of Revenue's 2025 SC1040 Instructions. The specific interaction depends on your income and filing status — consult a licensed tax professional for your situation.
Q4: Does it ever make sense to itemize instead of taking the standard deduction as a homeowner? It depends on your full financial picture. For 2025, the IRS standard deduction is $15,000 for single filers and $30,000 for married couples filing jointly. If your combined mortgage interest, SALT deductions (up to $10,000), and other eligible expenses exceed those thresholds, itemizing may reduce your taxable income. Homeowners with larger mortgages or higher state income tax obligations are more likely to benefit from itemizing. Those with smaller loan balances and modest property tax bills may find the standard deduction more advantageous. A licensed tax advisor can model both scenarios for your specific situation.
Q5: Will the SALT cap change in the future? As of April 2026, the $10,000 SALT cap remains current federal law. There have been ongoing legislative discussions about adjusting or eliminating the cap, but no changes have been enacted at this time. Because tax rules are subject to change, it's worth consulting a licensed tax advisor annually — especially in years when major financial decisions like a home purchase affect your overall tax position.
Q6: How does the SALT deduction affect buyers choosing between renting and buying in Myrtle Beach? The ability to deduct mortgage interest and property taxes (subject to the SALT cap) is one factor that can make owning more advantageous than renting from a long-term tax perspective — but only if you itemize. Renters receive no comparable federal deduction for their monthly payments. In Horry County, where the 2025 median home price held at $310,000 and verified property tax obligations for primary residences run well under the SALT cap (CCAR MLS, January 2026; SC Code § 12-43-220(c)(1)), understanding the tax side of ownership is one meaningful piece of the broader rent-versus-buy comparison.
Sources
Internal Revenue Service — SALT Deduction, Schedule A, Mortgage Interest Deduction: https://www.irs.gov/
SC Legislature — SC Code § 12-43-220(c)(1), Legal Residence Assessment Ratio: https://www.scstatehouse.gov/code/t12c043.php
SC Department of Revenue — 2025 SC1040 Instructions, Individual Income Tax Rate: https://www.dor.sc.gov/
Horry County Auditor — 2025 Certified Tax Levy: https://horrycountysc.gov/departments/auditor/
Coastal Carolinas Association of REALTORS® (CCAR MLS) — 2025 Annual Report on the Coastal Carolinas Housing Market: https://www.ccarsc.org/pages/marketstats/
National Association of REALTORS® — 2025 Profile of Home Buyers and Sellers: https://www.nar.realtor/
SC homeownership tax benefits — avoid capital gains on your SC home sale
Property tax deduction limits — cost of living: Myrtle Beach vs. Florida, Charleston, Wilmington
SALT deduction homeowners — rent vs. buy in Myrtle Beach 2026
