Governor-Elect Alan Wilson Wants to Cut the Tax on Rentals. What It Would Mean for Myrtle Beach Investors

The short answer

Alan Wilson plans to look at reforming Act 388, the 2006 law behind part of the higher property tax on rentals. A $350,000 rental inside Myrtle Beach pays $5,347 a year at 6%. At 4%, it would pay $3,564, or $2,037 if it were taxed like an owner's home.

No bill exists yet. The change needs two-thirds of each house of the legislature. By the unofficial count, Republicans are 4 votes short of that in the House.

Own or want a rental here? We work out its tax at 6% and at 4%.

What did Alan Wilson say about the tax on rentals?

Alan Wilson won the governor's race in the unofficial count, 51.71% to 47.00%. Jermaine Johnson conceded on election night. The Associated Press had not called the race when he did.

In an interview before the election, Wilson named the gap he wants to close:

"Owner-occupied homes are taxed at a much lower rate" while "second, third, and fourth homes, which are usually rental properties, are taxed at a higher rate."

"...looking at Act 388 and reforming how we assess property taxes on those types of properties."

Alan Wilson, in a full interview with WIS before the election

His affordability agenda, as Fox Carolina and HERE Columbia reported it, lists "Reforming Act 388 to remove higher property taxes for rental properties". He has published no bill text, no new rate and no cost.

Photo: Loadmaster

His other property tax plans

The same agenda, as reported, also lists these:

• Enroll seniors automatically in their property tax break for older owners.
• Expand the property tax break for disabled veterans.
• Lower personal property taxes for commercial businesses.
• Eliminate the state income tax and overhaul property taxes.

His campaign site adds a pledge to "eliminate the car property tax for seniors and veterans". Our guide to the 2026 election covers his other plans and the rest of the results.

How much property tax does a Myrtle Beach rental pay now, and at 4%?

At 4%, a Myrtle Beach rental would pay a third to three fifths less than it does at 6%. How much depends on whether a change also drops the school operating tax.

Two rules make the gap. The state constitution taxes a rental on 6% of its value and an owner's home on 4%. Since Act 388, an owner's home also pays no school operating tax.

Wilson has not said which of the two he means, so the chart shows both. Our page on what Act 388 changes would mean has the law's history.

Your rental's numbers

Type in the county's value of your rental. The tax rates are Horry County's for this year.

These bills are before credits and fees. Our Horry County property tax guide has the credits an owner who lives in the home gets.

If you buy a rental

When a rental sells, the county exempts 25% of its value at the sale. The exemption cannot bring the taxable value below the county's current value of the parcel. The buyer applies to the county assessor before January 31 of the first tax year.

Can the governor cut the tax on rentals by himself?

No. Lawmakers can change the 6% rate without a statewide vote, but only with two-thirds of the members of each house. That is 83 House votes and 31 Senate votes.

Republicans won 79 House seats in the unofficial count. Even with every Republican voting yes, a change needs 4 Democratic votes in the House. In the Senate, Republicans hold more seats than the two-thirds needs.

Two House races were close enough for a recount under state law, one led by each party. The Republican count could still move by a seat either way.

There are two ways to make the change:

1. Route 1: a new law
   1. House: two-thirds of its members vote yes.
   2. Senate: two-thirds of the senators agree.
   3. The new rate goes into state law. No statewide vote is needed.
2. Route 2: an amendment
   1. Two-thirds of the members elected to each house vote yes.
   2. A majority of voters approve it at the next general election, in November 2028.
   3. The next legislature votes to ratify it.

One pending bill, S. 815, would amend the constitution so lawmakers could set the classes and rates by ordinary law. It is in the Senate Finance Committee.

What would a rental tax cut cost Horry County and its schools?

Suppose every home now taxed at 6% moved to 4%. At 2018 shares, that would take about a sixth of the taxable value off the real property the county assessor values. The county, the cities and the schools would collect less, unless someone else paid more.

In 2018, rental property was 36.4% of the value the county assessor counts, but 47.2% of the taxable value. At 4%, rentals' taxable value would fall by a third.

The study behind these shares is by the Lincoln Institute of Land Policy. The South Carolina Chamber Foundation and South Carolina Realtors picked the ten counties it studied. It found the tax had shifted "from owner-occupied residential properties to non-owner-occupied residential properties as well as commercial, manufacturing, and utility properties."

The school operating tax is the largest part of a rental's bill. For homes their owners live in, a state fund filled by Act 388's 1% sales tax pays the school districts back. Wilson has not said whether the state would do the same for rentals.

Who says the gap is unfair, and who backs it

A 2025 student note in a University of South Carolina law journal argues the higher rate shifts the tax onto renters. It says the rate "can also prevent the development of affordable housing". The Lincoln study puts the yearly tax in South Carolina at about 0.5% of value for a home its owner lives in. For an apartment renter's property, it is slightly above 1.5%.

On the other side, groups such as nohometax.org back Act 388 as it is. The same note cites the group's page, titled "We Support Act 388".

What could a rental tax cut do to cash flow and prices?

In the first year or two, a cut would raise cash flow on the tax line, by a third or more of the bill. Over five years or more, past examples point to other owners paying a larger share, unless the state paid the difference.

• FirstNothing changes until lawmakers vote.
  • No bill exists. A change needs two-thirds of each house, or an amendment that voters approve in November 2028.
  • Until then, a rental's bill stays at 6%.
• Short run: the first 1 to 2 yearsMore cash flow, from the tax line only.
  • Our $350,000 city rental would keep $1,782 to $3,310 a year more.
  • Rents: no study we found measured how much of a tax cut reaches tenants here. A USC law student's note argues the 6% rate has pushed rents up.
  • Prices: a rental that nets more is worth more to a buyer. How much of the saving shows up in prices, no study here has measured.
• Long run: 5 years or moreOther owners pay a larger share, unless the state steps in.
  • The two rates and Act 388's school exemption shifted the tax toward rentals and businesses, the Lincoln study found.
  • A cut would move tax the opposite way. About a sixth of the taxable value of the real property the county assessor values would come off, at 2018 shares. Homes their owners live in and businesses would pay a larger share, unless the state replaced it or spending fell.
  • Over time, a lower yearly tax could lift what buyers pay for rentals. We give no figure, because no study here has measured it.

None of this is a forecast of what lawmakers will pass. It is what the same mechanism did before, with the size of the change our arithmetic gives.

What did Jermaine Johnson and the Democrats say about property tax?

Johnson's platform, as WMBF summarized it, called for lowering property taxes, income tax relief for lower-income families and "building more affordable housing". The summary does not say which property taxes he would lower.

In the House, a rental change needs Democratic votes. At today's count, if 42 of the 45 Democrats voted no, it would fail even with every Republican voting yes.

Annie Andrews, the Democrat who won the U.S. Senate seat, works on federal law, and the property tax here is state and local. Her housing plan backs a $50,000 federal tax cut for first-time buyers.

What should a Myrtle Beach rental investor do while this is debated?

Buy and sell on the tax a rental pays today. A plan with no bill can change before it passes, or never pass.

In Chapter3's experience, property tax stops more rental deals here than insurance does. When you buy or sell a rental, our agents check its numbers three ways:

• On the 6% bill it pays today, with the 25% exemption where it applies.
• On the 4% bills beside it, so you see what a change would be worth without paying for it up front.
• On the buyer's tax, which rests on the new price and can be higher than the seller's.

Our rental numbers guide adds the rest of the costs.

If you rent by the week, our page on which short-term rental rules a new Statehouse can change covers the other half of the law.

Common questions

Rental property tax questions

Does the 6% rate apply to a condo I rent out?

Yes. The 4% rate is only for the home the owner lives in and applies for. A condo, house or townhouse you rent out is taxed at 6%, whether it rents by the week or by the year.

Would a second home that is never rented get the cut?

Lawmakers have not decided. Today the 6% rate covers every home its owner does not live in, rented or not. Lawmakers would decide which homes a change covers when they write the bill.

Does the 4% rate stay on a home after its owner dies?

For a time, under a 2026 law. The home keeps the 4% rate until the estate closes or a deed out of it is recorded. At the latest, it keeps it until December 31 of the year after the death. It loses the rate if it is rented for more than 72 days.

Would a cut change the taxes a short-term rental collects from guests?

No. The plan is about property tax. A weekly rental still collects the state's 7% accommodations tax and any local tax of up to 3%. A few rentals are exempt, such as a home rented for 14 days or fewer in a year.

Sources: S.C. Constitution Art. X, Art. XVI, S.C. Code 12-43, 12-37, 11-11-155, 12-36, Horry County 2026 levy, H. 3841, S. 815, SC Election Commission, SC Daily Gazette, WIS, Fox Carolina, HERE Columbia, Wilson's priorities, WMBF, Lincoln Institute, USC law note, Florida Constitution Art. VII. Bills are our arithmetic from the county's 2026 rates, before credits and fees. Election results are the unofficial count. Not legal or tax advice.

Buying or selling a Myrtle Beach rental?

Send us the address. We work out its tax at 6% today and at 4%, and price it on the law as it stands.