Why open a Catastrophe Savings Account?
Catastrophe Savings Accounts allow you to set money aside, state income tax-free, to pay for qualified catastrophe expenses. Subject to the dollar limitations discussed below, the amount you contribute to your Catastrophe Savings Account can be deducted in computing your South Carolina taxable income. Any interest earned by the Catastrophe Savings Account will be exempt from state income tax and should be subtracted in computing your South Carolina taxable income. If you withdraw funds from your Catastrophe Savings Account to pay for qualified catastrophe expenses, you do not have to include the withdrawal in your South Carolina taxable income.
