In This Edition: SCRA and Industry Partnership Fund find new way to boost tech investment … State’s October unemployment rate was 2.6%, with York County at 2% … Remote sellers report almost $64 million in sales tax to SCDOR … Parent of CresCom, SC’s second-biggest bank, will sell in $1.1B deal … IRS Advisory Council issues 2019 report.

SCRA and Industry Partnership Fund Find New Way to Boost Tech Investment

The South Carolina Research Authority for many years relied on individual donors to build the Industry Partnership Fund, which helped invest seed money into the state’s tech startups. But ever since the Tax Cuts and Jobs act eliminated the significant federal tax credit that regularly attracted donations from individuals, the SCRA pivoted its fundraising model toward attracting investments from state businesses. “What started as a challenge became an opportunity,” said SCRA executive director Bob Quinn in connection with sustaining the organization’s ability to annually grant between $2 million and $3 million. SCRA CFO John Sircy (SCACPA Member since 2013) said the Industry Partnership Fund regularly reached its then-$6 million fundraising cap each January once eligibility to donate opened. A 2019 law passed by the state legislature raised the fundraising level to $7 million and will escalate to $9 million in the coming years. Quinn said about half of this year’s tax credits have been claimed. (Post and Courier)

State’s October Unemployment Rate was 2.6%, York County at 2%

October data from the South Carolina Department of Employment and Workforce showed that the state’s unemployment rate was a record 2.6%, a full percentage point lower than the national rate. York County’s October rate of 2% unemployment represents a rise from September’s rate of 1.8% but far ahead of its 3% year-over-year rate. The data estimates that South Carolina has 2.3 million workers, and DEW executive director Dan Ellzey praised the news of the creation of 58,000 jobs through 2019. (The Rock Hill Herald)

SCDOR: Remote Sellers Report Almost $64 Million In Sales Tax

The 3,800 out-of-state retailers registered in South Carolina have reported collecting nearly $64 million in sales tax for the state since November 2018, according to the South Carolina Department of Revenue. The reported collections stem from the U.S. Supreme Court’s 2018 South Dakota v. Wayfair ruling that an out-of-state seller with no physical presence in a state can be required to collect and remit sales and use taxes in states where they meet certain economic thresholds. As of Nov. 1, 2018, the DOR required a remote seller whose gross revenue from sales delivered into South Carolina exceeds $100,000 in the previous calendar year or the current calendar year is responsible for obtaining a retail license and remitting South Carolina Sales and Use Tax. Since then, remote sellers have reported sales tax revenues totaling $63,986,033 as of Oct. 31. Of that money, $33.9 will go into the state’s General Fund, $8.48 million will go into the state Education Improvement Act Fund and $8.48 million will go into the Homestead Exemption Fund. The rest is distributed to local governments that charge extra sales tax, including almost $3 million for capital projects, $3.2 million for schools and $2.5 million for roads. (SCDOR)

Parent of CresCom, SC’s Second-Biggest Bank, Will Sell in $1.1B Deal

Carolina Financial Corp., the Charleston-based parent of CresCom Bank, is being bought in an all-stock transaction by United Bank of Charleston, W.Va., and Washington, D.C. The boards of both companies have approved the sale, which is valued at $1.1 billion and expected to be completed by the end of June. CresCom’s name will be replaced in the combined operation, which will have about $25 billion in loans and assets. The 200 branches in the Southeast and mid-Atlantic regions will be among the 35 largest U.S. banks based on projected stock market value. While CresCom is the second-biggest lender whose headquarters are in South Carolina $3.8 billion in assets and 60 offices and has a recent record of expansion and acquisition in North Carolina, the much larger United Bank has $20 billion in loans and assets, with branches in seven states and the District of Columbia and a George Mason Mortgage division with offices in Bluffton and Columbia. (Post and Courier)

IRS Advisory Council Issues 2019 Report

The Internal Revenue Service Advisory Council issued its 2019 annual report, including recommendations to the IRS on new and continuing issues in tax administration. The federal advisory committee provides an organized public forum for discussion of tax administration issues between IRS officials and representatives of the public. Among the range of more than topics in the 202-page report are accelerating the use of e-Signatures in Federal Tax Administration, TCJA guidance, establishing safe harbors via conclusions of independent parties, improving the customer experience, and Form W-4 2020 Version. (IRS)

WHAT THEY’RE SAYING

“Other than friends and family, we’re the next ones in.”

John Sircy, CFO of the South Carolina Research Authority and SCACPA Member since 2013, on the importance of the SCRA’s government-backed investments in the state’s early-stage technology businesses