New Year and New SCDOR Revenue Ruling on Tax Credits
By Aaron Mayer, Director of Sherbert Consulting and Moxie Investment Funds, amayer@sherbertconsulting.com
In early 2025 we received a comprehensive revenue ruling on the textile mill tax credit, and in 2026 the South Carolina Department of Revenue (SCDOR) has already issued a similar comprehensive revenue ruling on the abandoned building revitalization credit.
The South Carolina abandoned building credit (ABC) has changed several times since first enacted under Chapter 67 of Title 12 back in 2013. Having worked on dozens of SC tax credit deals over the last twenty years, The Sherbert Group has learned that the specific fact-pattern of a given property needs to be closely analyzed to understand how eligibility for the credit may be impacted, and how the credit may be optimized.
SCDOR issued a revenue ruling in 2015 that gave practical guidance on qualifying for the ABC. But subsequent amendments to the code had made interpreting that ruling rather difficult in many cases. Issued in January 2026, SC Revenue Ruling #26-1 supersedes the prior one and applies to projects for which the Notice of Intent to Rehabilitate (NOIR) is filed on or after June 1, 2026. Overall, this ruling should help to clarify things for many projects in relation to the current abandoned building statute.
A few highlights from RR #26-1:
- There is a new and repeated emphasis on the property having prior income-producing use: 9 of the document’s 28 pages touch on this point.
- Another point which was implied in prior guidance but is now explicit, is that the abandoned building must still be there at the time the NOIR is filed.
- New clarifications are provided regarding single-family residences, state-owned abandoned buildings, subdivision of the site, and allocation of costs.
- The list of information to be provided with the NOIR has expanded significantly, from 7 items to 13 items.
Additionally, the ruling provides a window through June 1 for amending the NOIR for ABC redevelopments that have not yet placed the qualifying building site in service.
This revenue ruling adds a new layer to the analysis of how a given property fits within the ABC statute. But on the heels of this, just last week legislation was introduced that would amend the statute. So if you’re currently looking at an abandoned building redevelopment in South Carolina, The Sherbert Group would be glad to get you up to speed and to take a look to see how the credit might benefit you.