Out of 51 U.S. jurisdictions, South Carolina ranks #16 overall for its friendliness towards faith-based nonprofit organizations. South Carolina has several policies that facilitate the contributions of faith-based nonprofits, including an automatic exemption from state corporate income tax for religious organizations that have 501(c)(3) status and strong nonprofit religious corporation laws. Additionally, South Carolina has no audit requirements for religious organizations to solicit donations in the state. South Carolina, however, has some policies that are burdensome to faith-based nonprofits operating in the state, such as a Blaine Amendment and laws regarding public accommodations that include no meaningful religious exemptions.
Religious Freedom:
State Constitutional Protection of Free Exercise:
0
/5
The South Carolina Constitution follows in lockstep with the federal constitution’s protections, meeting but not exceeding the required minimum protections of the First Amendment.
State Religious Freedom Restoration Act:
3
/5
South Carolina has enacted a RFRA that protects the religious free exercise of all individuals and entities by requiring government burdens on religious exercise to satisfy strict scrutiny. Since these protections originate in a statute rather than the state constitution, South Carolina does not receive the highest score for this factor.
Religious Freedom for Nonprofits with Public Programming:
-5
/5
South Carolina’s nondiscrimination laws generally restrict religious freedom for religious organizations that offer public programming and facilities and provide no meaningful religious accommodations or exemptions.
Religious Freedom for Faith-Based Employers:
-3
/5
South Carolina’s nondiscrimination laws related to employment have only a narrow exemption allowing religious organizations to hire co-religionists.
Protections for Religious Exercise in State of Emergency:
3
/5
South Carolina law provides that religious worship can only be prohibited or restricted by an emergency order that: (a) applies equally to all “essential” secular entities in the jurisdiction, (b) serves a compelling governmental interest, and (c) is narrowly tailored.
Blaine Amendment:
-3
/5
The South Carolina Constitution contains a Blaine Amendment that could prevent the participation of faith-based schools in generally available public benefit programs on the same terms as similarly situated secular schools. This is not as broad as a general Blaine Amendment, which prohibits all aid to faith-based institutions, but is still detrimental to the work of faith-based institutions. Current U.S. Supreme Court precedent has rendered this language ineffective, but it could become effective in the future if Court precedent changes.
Regulatory Freedom:
Nonprofit Religious Corporation Act:
5
/5
South Carolina’s nonprofit corporation law includes a designated law governing the formation and operations of nonprofit religious corporations and specific provisions to protect their right to self-government in internal affairs.
Standards of Conduct for Directors of Religious Organizations:
5
/5
South Carolina law permits a director to rely on guidance from religious figures within his or her faith tradition in the fulfillment of the director’s fiduciary duties.
Charitable Registration Law:
0
/5
South Carolina generally requires charitable solicitation registration and only exempts entities that are not required to file Form 990, such as organizations classified as churches, religious orders, etc.
Audit Requirements Pursuant to Charitable Registration:
5
/5
South Carolina does not require the submission of reviewed or audited financials as a condition of maintaining authorization to fundraise in the state.
Corporate Income Tax:
5
/5
South Carolina imposes a corporate income tax but automatically exempts organizations with federal 501(c)(3) exempt status.
Sales and Use Tax, Sales:
3
/5
South Carolina imposes a sales and use tax on religious organizations’ sales but generally provides a broad and comprehensive, entity-based tax exemption for 501(c)(3) religious organizations’ sales upon application.
Sales and Use Tax, Purchases:
-3
/5
South Carolina imposes a sales and use tax on religious organizations’ purchases and only provides limited exemptions for certain items.
Property Tax:
1
/5
South Carolina imposes property tax and provides only fragmented property tax exemptions that include only a narrow subset of religious organizations.
