There are a few different options when it comes to starting a business in South Dakota. From a legal perspective, there are three main types of South Dakota for-profit business entities: LLCs, S Corporations or C Corporations. For most entrepreneurs, we believe an LLC provides the right mix of liability protection and ease of administration.
In order to form an LLC in the state of South Dakota, there are some minimum requirements you must meet. These are a completed set of Articles of Organization, a business name and a fee you pay to the South Dakota Secretary of State. We recommend taking some additional steps before formally starting your LLC:
- Research your target market to make sure there’s a demand for the products and services you provide.
- Read industry guides to give you a starting point in your niche.
- Create a comprehensive business plan that defines the most important aspects of your South Dakota business.
- Write an Operating Agreement that covers how you will run your LLC.
After you’ve created your South Dakota LLC, you will also need to review your business license requirements, understand ongoing filing needs, set up a separate business bank account and get an accountant.
In South Dakota, you register a business by completing and filing your Articles of Organization with the South Dakota Secretary of State. You will need to gather information about your business, fill out the form and send it to the Secretary of State with your filing fee. This will formally create your LLC in South Dakota.
You can file your Articles of Organization on the Secretary of State website or mail it in. Alternatively, Incfile can guide you through every step of the process by getting details from you and filing the form on your behalf — for free! There’s no additional charge for our basic LLC filing service, so all you need to do is pay the South Dakota state filing fee.
At the time of writing the fee charged by the South Dakota Secretary of State is $150 if you file online, or $165 if you file a paper form. You can always check the latest South Dakota filing fees here. You can also pay an additional $50 for expedited filing through Incfile, which will create your LLC faster. Some LLC filing services do charge you extra to prepare and submit your filing documents, but at Incfile, we do this for free — so you only pay the state fee.
Once you’ve gathered all of your information together and filed your Articles of Organization (or had Incfile do it for you), it can take up to 14 business days for the South Dakota Secretary of State to legally create your LLC. If you pay an additional $50 expedited fee, your LLC can be formed in as little as 2 days.
There are a few ways to register your South Dakota LLC name.
- If you’re starting a new business and your business name is unique in South Dakota and meets state naming rules, you simply include it in your Certificate of Formation.
- If you want to change the legal name of your business, you'll need to file Amended Articles of Organization with the Secretary of State.
- If you just want to do business under a different name, file a form for a "Doing Business As" (DBA) Name with the South Dakota Secretary of State, or we can do that on your behalf.
If you want to prevent people from using your business name across the U.S., you can file a trademark for the name. We can help.
In several other states, the formal documents that you file to form a corporation or LLC might be known as Articles of Incorporation. In South Dakota, this document is called your Articles of Organization, and it performs the same functions as the Articles of Incorporation.
Yes, the formation of a Series LLC within the state of South Dakota is permitted. A Series LLC is a special type of LLC where you create one “overall” business and then have individual, series LLCs within it, each counted as separate legal entities.
To form a Series LLC, simply fill out the Series LLC Articles of Organization form and file it with the Secretary of State. The fee for a Series LLC formation is $200 plus $50 for each series established. Check the registration details provided by the Secretary of State to ensure you have met all the requirements.
If you wish to change your South Dakota Registered Agent you can do so by filing a Statement of Change with the SD Secretary of State. Here at Incfile, we provide a free South Dakota Registered Agent service for the first year if you file through us. If you’ve been using a different Registered Agent and want to switch to us, we’ll file the Statement of Change on your behalf.
If you need to know the Registered Agent of a specific South Dakota business, you can reference a list of registered commercial agents provided by the South Dakota Secretary of State.
As an LLC, any business profits you earn will be reported on your personal 1040 filing and reported and taxed as “pass-through” income. You will typically need to pay:
- Self-employment or payroll tax on all business profits
- Federal income tax on profits after you meet your tax-free allowance
- Sales tax for selling taxable products and services
South Dakota charges a 4.5 percent state sales and use tax on all retail sales, leases and rentals of most goods. You will also need to pay sales tax if you provide a taxable service. You can find a full list of taxable services here.
For more information on sales and use tax details, refer to these resources provided by the SD Department of Revenue.
You will need to register as a sales tax vendor with the South Dakota Department of Revenue. You can complete this process online.
The base rate for South Dakota sales tax is 4.5 percent, and there may be additional municipal sales taxes depending on your region, county or city. Once you know your overall sales tax amount, calculate the value of all your taxable products and services. Then, multiply that by your sales tax rate to understand how much you will need to pay.
Once your LLC’s sales tax application is approved, you will receive a letter with instructions on how often you must file a sales tax return and pay sales taxes. Returns and payments may be due monthly, quarterly or annually.
No. In numerous states across the country, businesses are expected to pay a tax for the privilege of doing business in that state. Fortunately, this is not the case in South Dakota, making it one of the more business-friendly states.
If you are starting a business within any state in America, it's likely that you'll need some type of business license in order to operate. The types of business licenses you need will vary depending on your type of business, industry, location and various other factors. We can research the types of business licenses you might need for you.