H 4134 — High Growth Small Business Job Creation Act extension

2025-2026 Bill 4134 Text of Previous Version (Apr.(Mar.

09,05, 2025) - South Carolina Legislature Online South Carolina General Assembly126th Session, 2025-2026Bill 4134Indicates Matter StrickenIndicates New Matter(Text matches printed bills.

Document has been reformatted to meet World Wide Web specifications.) Indicates  Matter  Stricken  Indicates  New  Matter    Committee  ReportA Aprilbill 9,  2025TO  AMEND H.THE SOUTH CAROLINA CODE OF LAWS BY AMENDING ACT OF 2013, RELATING TO THE "HIGH GROWTH SMALL BUSINESS JOB CREATION ACT," SO AS TO AUTHORIZE THE EXTENSION FOR AN ADDITIONAL TEN YEARS;

4134   Introduced by Reps.

Robbins, B.

Newton, Dillard and Weeks   S.

Printed 4/9/25--H.

Read the first time March 5, 2025   ________   The committee on House Ways and Means To whom was referred a Bill (H.

4134) to amend the South Carolina Code of Laws by amending Act 80 of 2013, relating to the "High Growth Small Business Job Creation Act," so as to authorize the extension, etc., respectfully Report:

That they have duly and carefully considered the same, and recommend that the same do pass with amendment:

      Amend the bill, as and if amended, by adding appropriately numbered SECTIONS to read:

SECTION X.

Section 11-44-30 of the S.C.

Code is amended to read:

      Section 11-44-30.  For purposes of this chapter:

    (1) "Angel investor" means an accredited investor as defined by the United States Securities and Exchange Commission, who is:

       (a) an individual person who is a resident of this State or a nonresident who is subject to taxes imposed by Chapter 6, Title 12;  or        (b) a pass-through entity which is formed for investment purposes, has no business operations, does not have committed capital under management exceeding five million dollars, and is not capitalized with funds raised or pooled through private placement memoranda directed to institutional investors.

A venture capital fund or commodity fund with institutional investors or a hedge fund does not qualify as an angel investor.

    (2) "Department" means the South Carolina Department of Revenue.

    (2)(3) "Headquarters" means the facility or portion of a facility where corporate staff employees are physically employed, and where the majority of the company's or company business unit's financial, personnel, legal, planning, information technology, or other headquarters-related functions are handled.

    (3)(4) "Net income tax liability" means South Carolina state income tax liability reduced by all other credits allowed under Titles 11, 12, and 48.

    (4)(5) "Pass-through entity" means a partnership, an S-corporation, or a limited liability company taxed as a partnership.

    (5)(6) "Qualified business" means a registered business that:

       (a) is either a corporation, limited liability company, or a general or limited partnership located in this State and has its headquarters located in this State at the time the investment was made and has maintained these headquarters for the entire time the qualified business benefitted from the tax credit provided for pursuant to this section.

A business that is either a corporation, limited liability company, or limited partnership must be on file with the South Carolina Secretary of State and in good standing for the duration of its registration as a qualified business;

       (b) was organized no more than five years before the qualified investment was made;

       (c) employs twenty-five or fewer people in this State at the time it is registered as a qualified business;

       (d) has had in any complete fiscal year before registration gross income as determined in accordance with the Internal Revenue Code of two million dollars or less on a consolidated basis;

       (e) is primarily engaged in manufacturing, processing, warehousing, wholesaling, software development, information technology services, research and development, or a business providing services set forth in Section 12-6-3360(M)(13), other than those described in subitem (f);  and        (f) does not engage substantially in:

           (i) retail sales;

           (ii) real estate or construction;

           (iii) professional services;

           (iv) gambling;

           (v) natural resource extraction;

           (vi) financial brokerage, investment activities, or insurance;

           (vii) entertainment, amusement, recreation, or athletic or fitness activity for which an admission or fee is charged.

    A business is substantially engaged in one of the activities defined in subitem (f) if its gross revenue from an activity exceeds twenty-five percent of its gross revenues in a fiscal year or it is established pursuant to its articles of incorporation, articles of organization, operating agreement, or similar organizational documents to engage as one of its primary purposes such activity.

    (6)(7) "Qualified investment" means an investment by an angel investor of cash in a qualified business for common or preferred stock or an equity interest or a purchase for cash of subordinated debt in a qualified business.

Investment of common or preferred stock or an equity interest or purchase of subordinated debt does not qualify as a qualified investment if a broker fee or commission or a similar remuneration is paid or given directly or indirectly for soliciting an investment or a purchase.

    (7)(8) "Registered" or "registration" means that a business has been certified by the Secretary department as a qualified business at the time of application to the Secretarydepartment.