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LLC Taxes In South Dakota

In order to launch and operate an LLC (limited liability company) in South Dakota, a number of documents will have to be prepared and filed with the state. Below, you’ll find more information about requirements for state tax filing and ongoing reporting for LLCs in South Dakota.


South Dakota LLC Taxes

Completing Annual Reports

In South Dakota, LLCs are required to file an annual report each year. This report can be submitted online via the Secretary of State site, or it can be sent in through the mail. A blank form can be obtained on the SOS site. The report only requires you to provide a few pieces of information, such as the name of your LLC and its ID number, the address its main office is located at, the name and address of its registered agent, and the name and addresses of any LLC managers.

This report needs to be filed every year. The deadline is the first day of the month following the month the LLC was created in. For example, if an LLC was created in March, the form would be due in April. There is a $50 filing fee. The SOS should send you a notice 30 days before your annual report must be submitted.

State Business Tax for LLCs

The majority of LLCs are considered to be “pass-through” tax entities. This means that the LLC is not responsible for paying federal income tax. Instead, taxes must be paid by members of the LLC.

Although most states have a corporate income tax or personal income tax, that is not the case for South Dakota. Because of this, the majority of LLCs, including ones that have chosen to be taxed as corporations, will not need to pay state income taxes. Since there is no personal income tax in South Dakota, the majority of LLC members will not owe any state tax on income earned from an LLC in South Dakota.

State Employer Taxes for LLCs

If your LLC has employers, paying employer taxes will be necessary. A portion of these taxes will be owed to the IRS, which means they won’t be covered here. However, you should be aware that obligations for federal employer taxes begin by obtaining an EIN, which is a federal employer identification number. It may also be necessary for employers in South Dakota to pay state taxes.

It’s likely that you will have to register to pay state UI (unemployment insurance) taxes. The DLR (Department of Labor and Regulation) in South Dakota handles these taxes. It’s possible to register for UI taxes by mail or online after completing DLR Form 1. From there, you’ll use DLR Form 21 to report wages and pay UI taxes every quarter. If you’d like to find out more, visit the site for the DLR.

Sale and Use Taxes for LLCs

LLCs that sell goods to South Dakota customers must collect and pay sales tax. In order to do this, you must register to pay sales tax with the DOR. This can be done online. Afterward, you’ll receive a sales tax license. Periodically, you’ll submit sales tax returns and make payments on the goods you’ve sold. You can obtain a blank form for sales tax returns on the DOR site. You can also find additional information here.

Registering Your LLC In Additional States

If you intend to do business in states that aren’t South Dakota, it may be necessary for you to register your LLC in these states as well. Is registration necessary? That will vary based on the states you are going to be doing business in. Different states have different requirements, which means you’ll have to check to see if you need to register. Activities like soliciting business in a state, having a physical business location in a state, or hiring employees in a state may require you to register. Typically, in order to register, you’ll need to obtain a document such as a certificate of authority.

Additional Resources