1350                            STATE OF SOUTH CAROLINA
                                     DEPARTMENT OF  REVENUE                                      I-334
                                                                                                 (Rev. 7/1/19)
                                                                                                      3407
                                     MILK CREDIT
   dor.sc.gov                                                                                    20
Name                                                                                             SSN or FEIN

This form must be attached to the SC1040, SC1065, SC1120, or SC1120S.

1. Enter the number of pounds of milk produced and sold during Calendar
   Year      , as certified by the Commissioner of Agriculture. ...................................................................................                           lbs.
   If less than 500,000 pounds,STOP. You do not qualify.

2. Enter $2,500 if line 1 is greater than or equal to 500,000 pounds...............................................................................$

3. Subtract 500,000 pounds from line 1...........................................................................................................................             lbs.

4. Divide line 3 by 500,000 pounds and round down to the nearest whole number......................................................... 

5. Multiply line 4 by $1,250..............................................................................................................................................$

6. Add lines 2 and 5.........................................................................................................................................................$

7. Enter the number of quarters in Calendar Year            to which the credit applies,
    as certified by the Commissioner of Agriculture........................................................................................................... 
8. Multiply line 6 by line 7. Enter here and on the appropriate line of your tax return.....................................................$ 
   This is the amount of the credit. 

Instructions:

For  taxable  years  beginning  after  2004,  a  refundable  credit  against  Individual  or  Corporate  Income  Tax  is  available  to 
resident taxpayers engaged in the business of producing milk for sale. This refundable credit is based on the amount of 
milk produced and sold.
The credit amount is $10,000 for the first 500,000 pounds of milk produced and sold below the production price over a 
calendar year, and $5,000 for each additional 500,000 pounds of milk produced and sold below the production price during 
the calendar year. Credits must be prorated on a quarterly basis.
The SC Commissioner of Agriculture will certify to the SCDOR which producers are eligible to claim the credit and the 
amount of the credit.

The credit is allowed when the USDA Class I price of fluid milk in South Carolina drops below the production price as 
determined  by  the  SC  Department  of  Agriculture  (SCDA).  The  production  price  is  based  on  such  factors  as:  (1)  the 
average price of milk in the top five states where milk is imported to South Carolina; (2) the average transportation cost of 
importing milk from those five states; and (3) the cost of production in South Carolina. The SCDA regulations are available 
at agriculture.sc.gov.

Once all information is available, the average production price is posted on the SCDA website at agriculture.sc.gov and is 
available in the SC Commissioner of Agriculture’s Office.

The SCDA provides a form to be completed and signed by all dairy producers filing for this credit. The form is for certifying 
the  amount  of  milk  produced  and  sold  by  a  specific  producer  for  the  entire  taxable  year.  The  form  includes  a  sworn 
statement by the producer regarding the accuracy of the information listed.

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The SCDOR will use this information to verify the credit claimed. All disputes regarding the credit or refund under the Milk 
Producer Tax Credit program will be resolved in accordance with SCDOR regulations and policies.

Definitions:

   “Class I price of fluid milk” is the uniform milk price in South Carolina published by the USDA.

   “Producer” is any individual, farm, corporation, or other legal entity that produces and sells milk produced from their own   
cows.

   “Cost of production” is the average cost of production in South Carolina.

   “Production price” is the cost of production in South Carolina, plus the difference between the average uniform price of 
milk in the top five markets where milk is imported, including transportation costs, and the uniform price of milk in the 
Appalachian Order. 

Social Security Privacy Act Disclosure
It  is  mandatory  that  you  provide  your  Social  Security  Number  on  this  tax  form  if  you  are  an  individual  taxpayer.  42 
U.S.C.405(c)(2)(C)(i)  permits  a  state  to  use  an  individual's  Social  Security  Number  as  means  of  identification  in 
administration of any tax. SC Regulation 117-201 mandates that any person required to make a return to the SCDOR must 
provide  identifying  numbers,  as  prescribed,  for  securing  proper  identification.  Your  Social  Security  Number  is  used  for 
identification purposes. 

The Family Privacy Protection Act
Under the Family Privacy Protection Act, the collection of personal information from citizens by the SCDOR is limited to the 
information necessary for the SCDOR to fulfill its statutory duties. In most instances, once this information is collected by 
the SCDOR, it is protected by law from public disclosure. In those situations where public disclosure is not prohibited, the 
Family  Privacy  Protection  Act  prevents  such  information  from  being  used  by  third  parties  for  commercial  solicitation 
purposes. 

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