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LLC Cost In South Dakota - How Much To Pay In Fees & Taxes in SD

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Last updated February 17, 2023

Written by Dmytro Kondratiev

Editor, lawyer

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Do you already know how to start an LLC in South Dakota and plan to launch? And what about the costs? Have you made an estimate? It’s no less important part of business formation than the registration process.

In this article, you’ll find all costs you’ll encounter and need to consider when setting your legal entity up and running in South Dakota.

How Much Is an LLC in South Dakota?

First and foremost, LLC registration is payable. Yet, there is no single formation cost for companies across the US. These are state-specific entities, and registration costs will vary by jurisdiction.

Likewise, there is no uniform formation cost for all companies in the same jurisdiction since the final LLC price in South Dakota is more than just a filing fee. The factors impacting your subtotal include the following:

LLC type;
Area of activity;
The industry you are going to operate in;
Business growth goals and plans, etc.

By and large, all associated costs and payments can be divided into two major categories:

Standard costs that will appear for pretty much any company in the state;
Optional costs that you will choose depending on your individual business situation.

Below, we’ll enlist and explain all the payments and charges you’ll come across, and you’ll be able to work out your own estimate to calculate your own expenses.

Service	Cost
State filing fee	$150
Foreign LLC filing fee	$750
Annual report fee	$50
Registered agent change fee	$10
Name reservation	$25
Certificate of Good Standing	$20
DBA Name	$10
Certified document copies	$15 per doc + $2 per page
LLC amendment rate	$60
LLC dissolution rate	$10

Standard LLC Fees in South Dakota

These are expenses that embrace both one-off fees and some regular payments that will become a permanent part of your future operational expenses. Regular costs and fees are normally aimed at maintaining your company’s good standing status.

South Dakota LLC Filing Fee: $150

Your South Dakota LLC will start from the registration of the Articles of Organization with the state. A company statute is a generic document enlisting common info such as:

LLC name and registered address;
Registered agent info;
Entity formation date (and dissolution date if applicable);
LLC purpose or any other info you deem necessary.

The statute is to be filed with the SD Secretary of State either online or by mail. Online filings are faster and cheaper at $150. To file by mail, you’ll have to complete an application form and pay $165 including a paper processing fee of $15.

Notably, online applications are processed immediately while mailed forms are reviewed within about 3 weeks.

Registered Agent in South Dakota: $0 - $150

A registered agent (RA) is one of the few LLC requirements you’ll have to observe. It’s your company’s representative that will receive and handle your legal mail.

As such, it will ensure you timely obtain any crucial notes and service of process to promptly respond or react.

When it comes to the RA price, there is no fixed fee. How much it will cost you depends on your RA choice:

You can serve your own agent and handle your mail on your own paying nothing for this;
You can ask some of your close acquaintances such as family members, friends, or colleagues to process your mail and agree that they do it for free as well;
You have the option of hiring an attorney or business advisor for that purpose. Yet these specialists will most likely bring high costs;
Finally, you can cooperate with a special RA service that will do the job professionally and won’t cost you a fortune.

Our recommendation is that you hire one of the South Dakota registered agent services. They offer full-scale assistance and offer annual subscriptions at about $100 - $150.

Annual LLC Fee in South Dakota: $50

South Dakota has compulsory reporting requirements for LLCs. To stay compliant with state rules and maintain eligibility, you’ll have to file an annual report that updates your basic business data on a yearly basis.

You can submit this report online via the Secretary of State’s website. A filing fee is $50 and the due date is November 15. Delayed filings will entail a $50 penalty.

Foreign LLC Cost in South Dakota: $750

In South Dakota, you can both start a new LLC from scratch or register an already existing company to make it legal in this jurisdiction. To run a business in South Dakota under the LLC formed in another state, you should get a foreign qualification for your existing entity.

Unlike other states, South Dakota has a much higher state fee for foreign LLCs as compared to domestic ones. You’ll have to file an online Certificate of Authority and pay a $750 fee. Should you choose to file by mail, the fee will be $765.

South Dakota Series LLC: $200

South Dakota is one of a few states that allows for series LLCs. It’s a special form of entity great for multi-brand companies. The structure will let you optimize costs and save business funds in the long run.

To set up a series LLC in SD, you should file the Articles of Organization and Qualification of Master Series with the state and pay a $200 registration fee. Besides, you’ll have to pay $50 for each added series.

Note that series LLC filings are available only by mail for now and the documents are processed within 3 to 5 business days.

LLC Licenses and Permits in South Dakota: Local Fees

The state doesn’t have statewide business license requirements. You won’t have to register for a license and pay an annual fee to simply operate in the state.

At the same time, all entities physically present in SD will have to get a seller’s permit or a sales tax license issued by the Department of Revenue.

Besides, businesses engaged in certain professions, industries, or occupations might need specific permissive documents to operate. You can check with the SD Department of Labor and Regulation for the state occupational licenses.

Finally, there are a number of local permits to consider for your company. You can get info about those with your municipal and county authorities. Licensing fees will vary locally.

South Dakota LLC Taxes

Just like the LLC laws, its tax rates are state-specific. So, in South Dakota, you should take into account the following levies when planning your company formation:

South Dakota has neither an individual nor a corporate income tax, hence, your entity won’t have to pay a state income tax;
Self-employed LLC members will be exposed to a self-employment tax paid at a fixed rate of 15.3%;
A state sales tax in South Dakota is 4.5%. With a maximum local tax rate of 4.5%, an average combined sales tax rate across the state is 6.4%;
Payroll tax rates in the state vary from 0% to 9.3% and depend on the wage amount.

Optional South Dakota LLC Costs

These are additional costs that might occur in case you need some optional services. They won’t add to your regular expenses are all one-time payments.

Business Name Reservation in SD: $25

If you hit the spot with an original and distinguishable business name for your future LLC that is available in South Dakota, you can put it on hold for a period of 120 days.

This is normally done when entrepreneurs are not ready to file yet and need more time for due preparation, yet still want to retain the desired name.

To reserve a business moniker in South Dakota, you should file a name reservation application with the Secretary of State and pay a $25 processing fee.

DBA Registration in SD: $10

DBA (doing business as) names are allowed in nearly any US state and offer flexible growth opportunities for business.

Using a DBA or fictitious business name which is different from your registered LLC name, you can market your business in a more efficient and active way.

Besides, you are allowed to register as many DBAs for your company as you need. This will enable you to run several brands and product or service lines using the same LLC structure. This way, you can grow your company without getting into legal complexities.

The only thing to remember is that each DBA requires separate registration and paying a $10 processing fee.

Certificate of Good Standing in SD: $20

This document verifies that your company is duly registered with the state and fully complies with the state requirements. It’s not a must-have as the Articles of Organization and is issued by the Secretary of State under your request. The cost is $20.

Most often, a Certificate of Good Standing is required by banks and lending agencies or institutions to support your business bank account setup or business loan issue.

Certified Document Copies in SD: $15

At some point, you might need copies of your formation documents or other business-related papers issued by the state. You can order those copies from the SD Secretary of State with due state certification.

Whether you need a copy of your Articles of Organization or some license, you’ll get it on paper signed and endorsed by the state. The cost is $15 per document plus $2 per page.

Articles of Amendment in SD: $60

Unlike other states, South Dakota allows changing all your basic company info via filing the Articles of Amendment except for the registered agent change that requires a separate statement.

It costs $60 to file the Articles of Amendment. Usually, the amendments are processed within 2 business days.

Articles of Termination in SD: $10

While the procedure of LLC dissolution should be outlined in an Operating Agreement, to legalize the process, you should file the Articles of Termination with the state.

It costs only $10 and it takes the state 2 business days to consider your docs. You can expedite the approval and get your documents back in 1 business day by paying an additional $50 fee.

FAQ

Is a South Dakota LLC worth the investment?

Though the LLC formation is not free, the money you pay to use this legal structure quickly pays off with great advantages.

Liability protection ensured by this framework ensures the highest security to your personal assets no unincorporated business form can offer. This aspect alone makes an LLC a perfect choice for any small business, not to mention flexible taxation.

What is the processing time for LLC filings in South Dakota?

In this state, you can get your company formed in mere minutes if you file online. Meanwhile, postal applications are considered within a period of up to 3 weeks.

Do I need to register for a general business license for my LLC in SD?

LLCs are not required to get a statewide business license in South Dakota and pay for running their businesses within its territory. Yet, it doesn’t mean you don’t need any industry-specific or local licenses. Towns, cities, municipalities, and counties might have their own licensing requirements for LLCs. So, you should check with your local governments about that.

Will my South Dakota LLC be an income taxpayer?

If you stick to the pass-through tax scheme standard for LLCs, your company won’t have to pay an income tax at a state level. Its income will be taxed under the tax returns of its owners. However, companies taxed as C-Corps should pay a corporate income tax similar to common corporations.

Should my South Dakota LLC be renewed on a yearly basis?

LLCs in South Dakota are exposed to annual reporting requirements and should file a state report each year before November 15.

What is the cheapest way to get an LLC in South Dakota?

While many beginner entrepreneurs choose to hire an attorney or LLC service to handle the business registration for them, this type of assistance is not free. You’ll be able to get a cheap LLC in South Dakota by doing all the formation work on your own.

You’ll have only state fees to pay and save on extra costs that might bump up the final price quite a bit.

Will my South Dakota LLC be eligible for tax rebates?

An LLC structure doesn't give the right to get tax refunds. Yet, if you select a C-Corp tax status for your company under Form 8833, you can expect to compensate for some taxes.

Will I receive a salary from my South Dakota LLC?

When forming a standard LLC, you’ll get paid via income draws i.e. receive a part of the company’s profit pro rata to your contribution. These are only LLCs taxed as corporations that are entitled to hire their owners and pay them employee wages.

Can my cell phone costs be referred to as my SD LLC expenses?

In case over 50% of your personal phone use is for work, you can deduct the related costs from your LLC.

Is my Internet fee deductible from my South Dakota LLC if I run a business from home?

Yes, you can write off your Internet expenses from your LLC if you use your home connection for business purposes most of the time.

Can I compensate for my car costs from my South Dakota LLC?

Using your own vehicle for work, you can deduct the related costs from your LLC either in proportion to the use or in full if you drive your car solely for business.

Can my fuel receipts be a part of my South Dakota LLC expenses?

You can include your fuel receipts to general car costs to be written off. Or you can calculate the mileage driven for business and deduct the fuel costs accordingly.