6% Tax Rate - South Carolina Rental Properties

[Scott Vaeth]

I purchased a house in South Carolina this past year with the goal of BRRRRing it. I currently live in it as my primary residence but had plans to eventually rent it out and then cash out refi once I reach 20% equity in the property. I'm now realizing that in the state of South Carolina, the tax rate jumps 2% for rental properties to help fund public schools, a $600/mo cost that I didn't account for when using the calculators in the earlier stages. By the time I reach 20% equity (likely 3+ years away), my monthly mortgage payment will come down when I refinance, but $600 is a big hit to the numbers. I feel like these are my only options:
- House Hack: Would I still need to pay the 6% tax rate if I'm getting rental property insurance?
- Renting it Out: The likely rent I'd get in this area will cover half my mortgage payments at the moment
- Add Square Footage: Taxes will likely go up significantly
- Build an ADU: Overall ROI will likely not offset much since it'll still be counted as value tied to the one house
- Selling Off Land: Sits on .5 acre that I might be able to sell. This obviously will only get me so far. 

I already have some equity in the property after doing a complete rehab but I don't want to diminish my returns selling it after one year, paying for commissions/closing costs. It's in great location that I'm confident will continue to appreciate. However, the opportunity cost is that I won't have funds to invest with my current salary as long as I have this house. Any advice would be greatly appreciated.

[John Underwood]

Are you sure it's not $600 extra per year?

If you are living there you can keep the 4% rate.

If you are not living there you can rent it out to pay for the property taxes.