SC Democrat Joe Cunningham reported jump in income, taxes paid after election to Congress

When Joe Cunningham was elected in 2018 to represent the 1st District in Congress, the now-Democratic nominee for governor reported a $100,000 jump in his income.

His taxes also went up as he paid an additional $20,000 a year to the state and federal governments.

In total, from 2017 through 2021, Cunningham reported $684,000 in income to the IRS and paid more than $117,000 in state and federal taxes, according to returns released Tuesday afternoon by his campaign.

The income reported on joint returns from 2017 through 2020 includes money earned from his now ex-wife’s yoga studio before they divorced earlier this year. In 2017, 2018 and 2021, Cunningham reported income from his work as a lawyer in the Lowcountry.

Cunningham in 2018 left the Lyles and Lyles construction law firm in Mount Pleasant when he first ran for Congress and started his own firm, Joe Cunningham Law. He did not earn any income from his own firm while in Congress.

In his 2021 return, separate this time, Cunningham reported $60,500 in wages from his law firm.

News outlets, including The State newspaper, were allowed to view Cunningham’s tax returns from 2017 through 2021 to view how the one-term congressman earned his money after entering the public eye.

The State last week reviewed the tax returns, which were embargoed until 5 p.m. Tuesday.

Analysis of Joe Cunningham’s tax returns

The annual filings ultimately show Cunningham filed vastly simpler tax returns than Gov. Henry McMaster, the Republican incumbent Cunningham’s trying to unseat in November.

McMaster reported more than $2.5 million income from 2015 to 2020, including income from rental properties he and his wife, Peggy, own around Columbia. The McMasters paid more than $647,000 in taxes during that time period.

Cunningham and his ex-wife Amanda reported income jumped from just under $70,000 in 2018 to $177,000 in 2019 once Cunningham joined the U.S. House for two years. Republican U.S. Rep. Nancy Mace, who recently bought a house in Isle of Palms, defeated Cunningham in 2020.

In 2019, Cunningham also contributed $21,000 into the congressional retirement fund.

In each year of tax returns released by his campaign, Cunningham took the standard deduction.

In 2017, the standard deduction was $12,700. The former couple also claimed $8,100 in exemptions.

In 2018, the standard deduction was $24,000, in 2019 it was $24,400 and in 2020 it was $24,800. In 2021, when Cunningham filed separately, the standard deduction was $12,550.

Cunningham filed jointly with his then-wife Amanda from 2017 through 2020. After seven years of being married, their divorced was finalized earlier this spring, and Cunningham filed a separate tax return for the 2021 tax year.

In his most recent federal return, Cunningham reported $60,500 in wages and nearly $112,000 in other net income after expenses from running his Charleston law firm, which specializes in construction and personal injury litigation. He also provides consulting services for businesses and advocacy groups, according to his firm’s website.

Cunningham’s returns did not list who his clients are and his campaign would not divulge the information.

“No attorney is going to give out their client list. That’s not for public consumption and no lawyer would, and certainly Henry McMaster as an attorney would know you can’t do that,” said Tyler Jones, Cunningham’s senior campaign advisor.

The amount of state income tax Cunningham paid dropped by more than $9,300 in 2021 as his pass through business income was deducted from his taxable income on his state return.

As part of his campaign push called “freedom agenda,” Cunningham has called for eliminating the state income tax. It’s a move that would require replacing $6.2 billion in the state budget.

Cunningham has said he would work with the General Assembly to craft it, but his plan includes legalizing sports betting and marijuana and eliminating state incentives to corporations.

Cunningham sold his house, donated to charity, records show

According to the Democratic nominee’s tax returns, Cunningham and his ex-wife sold their house for $335,000 in 2018, which they owned for two years. After closing fees, the couple netted $316,848 from the sale of the house, which they bought in 2016 for $299,000.

In addition to taking the standard deduction, the former couple had a handful of other deduction and credits on their returns.

In 2017, the couple took a $2,500 deduction for student loan interest paid.

Cunningham also reported paying $7,711 in self-employment taxes in 2018.

In 2018, they had their son, Boone, and began claiming the child tax credit on their federal returns and the dependent deduction on their state tax returns.

In 2020, they also spent $9,900 for Boone to attend a Montessori school in Mount Pleasant. That amount, however, was not high enough to claim a dependent care credit on their federal return.

Cunningham in 2021 also took a $9,015 deduction for self-employed health insurance.

Though both traditionally took the standard deduction, Cunningham and Amanda did take the $300 deduction for charitable contributions in 2020. Traditionally, in order to deduct charitable contributions, a filer would need to itemize deductions. But in 2020, the federal government allowed filers to claim up to $300 in cash donations to charities without itemizing as part of the federal government response to the COVID-19 pandemic.

The couple’s 2020 donations went to the Seacoast Church in Mount Pleasant, Cunningham’s campaign said.

Cunningham’s income, taxes paid by the numbers

Here’s a year-to-year breakdown of how much total income Democratic nominee for governor Joe Cunningham and his ex-wife, Amanda, reported since 2017, and how much they paid in income taxes. The couple filed jointly from 2017 through 2020. In 2021, Cunningham filed a separate return after their divorce was finalized.

Total income

▪ 2017: $66,631

▪ 2018: $69,969

▪ 2019: $177,088

▪ 2020: $198,078

▪ 2021: $172,434

Total federal income tax paid

▪ 2017: $5,566

▪ 2018: $8,515

▪ 2019: $21,864

▪ 2020: $26,486

▪ 2021: $28,834

Total state income tax paid

▪ 2017: $2,536

▪ 2018: $1,361

▪ 2019: $9,587

▪ 2020: $10,907

▪ 2021: $1,596