South Dakota LLC Costs
Recommended LLC Services
Small businesses and entrepreneurs benefit when forming a limited liability company in South Dakota. An LLC is a business structure that provides business owners with liability protection, unique taxes, state-specific incentives, and a flexible management structure. A common misconception is that forming an LLC in South Dakota is difficult and expensive. However, the process is straightforward and worth the investment for many.
Costs to start an LLC in South Dakota
LLC Articles of Organization ($150 online)
South Dakota annual report fee ($50 online)
- You must file an annual report with the South Dakota Secretary of State.
- You can file online using the South Dakota Secretary of State website.
- Or, you can complete the annual report form and submit it by mail.
- The annual fee is $50 online, or $65 if you file by mail.
- The due date for your annual report is November 15th.
- The penalty for failure to pay the fee on time is $50, and the LLC could face possible dissolution.
South Dakota registered agent fee (varies between $50 to $300)
- In South Dakota, you must appoint a registered agent when forming an LLC in the state.
- When you appoint a registered agent, you are alerting the South Dakota Secretary of State that someone is physically available during business hours to accept services such as tax notices and subpoenas.
- In South Dakota, you can appoint anyone as a registered agent as long as they meet the state requirements, which include yourself.
- The total cost for a registered agent in South Dakota will depend on the commercial service you appoint, the needs of your LLC, and state filing fees.
Fees to form a foreign LLC in South Dakota ($750 online)
- If you have an existing LLC in another state, you will need to register your LLC as a foreign LLC if you wish to expand into South Dakota.
- You can register a foreign LLC online using the South Dakota SOS website.
- Or, you can complete the Application for Certificate of Authority and submit it by mail.
- The filing fee to register a foreign LLC in South Dakota is $750 online and $765 if you file by mail.
LLC name reservation fee ($25)
- You do not have to reserve a South Dakota LLC name before formation.
- But, when you reserve an LLC name, you are ensuring that no one else can register the same before you begin LLC formation.
- A South Dakota LLC name must be unique.
- You can reserve an LLC name for up to 120 days before formation.
- You can reserve your name online using the South Dakota Secretary of State website.
- Or, you can complete the Application for Reservation of Name and submit it by mail.
- The LLC filing fee to reserve a South Dakota LLC name is $25.
DBA filing fees in South Dakota ($10)
- The acronym DBA stands for the business term ‘doing business as.’ A DBA, or an assumed name, is any name an individual or business uses to operate that is not the legal name.
- In South Dakota, LLC must register a DBA for any business that operates using any name other than the LLC’s legal name.
- A DBA in South Dakota does not have to be unique.
- You will register a South Dakota DBA name online using the SOS website.
- The cost to register a South Dakota DBA name is $10.
Cost of certified document copies ($15)
- You will order your certified LLC documents online using the South Dakota Secretary of State website.
- The cost for certified LLC documents in South Dakota is $15 plus $2 for every additional page.
South Dakota Certificate of Good Standing ($20)
- Banks and money lenders will require you to present a copy of the South Dakota Certificate of Good Standing before allowing you to open a business bank account.
- You will order a Certificate of Good Standing through the South Dakota SOS website.
- The filing cost for a Certificate of Good Standing in South Dakota is $20.
Foreign LLC name reservation fee ($25)
- If your LLC name is already taken, as a foreign LLC, you will need to reserve and register a different name.
- You will complete the Application for Registration of Name and submit it to the South Dakota SOS.
- The filing fee to reserve a foreign LLC name in South Dakota is $25.
Steps to start an LLC in South Dakota
Choose a business name
When deciding on an LLC name in South Dakota, you will want to consider a few things.
- An LLC name in South Dakota must be unique and available.
- An LLC name must meet all South Dakota naming requirements.
- You keep branding simple by checking for web domain availability.
You will use the South Dakota Secretary of State Business Name Availablity Search to conduct a name search.
LLC name reservation fee
South Dakota does not require the reservation of an LLC name before formation.
The cost to reserve a company name in South Dakota is $25. An LLC name is good for up to 120 days. South Dakota does not require you to reserve an LLC name.
Appoint a South Dakota registered agent
You must appoint a registered agent in South Dakota when forming an LLC in the state.
The price for a South Dakota registered agent or service varies between $50 and $100 a year. The cost depends on the state and your LLC needs.
A registered agent in South Dakota is an individual or business entity that receives tax forms, legal documents, subpoenas, civil notices, service of process, and other official government correspondence on behalf of a sole proprietorship, corporation, or LLC.
The registered agent you choose must be a South Dakota resident or a registered agent service authorized to conduct business in the state.
- Starter Plan – $39 a year plus State Fees
- Pro Plan – $149 a year plus State Fees
- Premium Plan – $249 a year plus State Fees
ZenBusiness has a stand-alone registered agent service for South Dakota LLCs. The price is $99 per year.
- Total Out The Door South Dakota LLC Formation Service Package – $50 a month and includes:
- South Dakota State Fee
- Filing Service Fee
- Registered Agent
- Tax ID
- Annual Plan – $225 plus State Fees a year
- Economy – $79 plus $153 South Dakota filing fees
- Standard – $329 plus $153 state filing fees
- Express Gold – $349 plus $255 state filing fees
File South Dakota Articles of Organization
You will file your LLC’s Articles of Organization with the South Dakota Secretary of State.
You can file your Articles of Organization online using the SOS website.
Or, you can complete the Articles of Organization form and submit it by mail.
The LLC cost to file South Dakota Articles of Organization online is $150, and $165 if you file by mail.
South Dakota offers 24-hour expedited LLC services for an additional $50.
South Dakota Secretary of State Office
500 E Capitol Ave
Pierre, SD 57501
The South Dakota LLC Articles of Organization form will ask for specific information.
- LLC name
- Purpose of the LLC
- Registered agent information
- Name of organizers
The fee in South Dakota for filing your LLC Articles of Organization online is $150, and $165 if you file by mail.
Get a South Dakota LLC EIN
An Employer Identification Number, or EIN, can also be referred to as a Federal Employer Identification Number (FEIN) or Federal Tax ID Number (FTIN).
The IRS issues an EIN to your LLC free of charge. The 9-digit number acts like a Social Security Number for companies for income tax purposes.
In South Dakota, you must apply for an EIN if you are converting a sole proprietorship into an LLC.
Applying for an EIN is a simple process online through the IRS website.
Business banking for a South Dakota LLC
Professionals recommend that you open a business bank account separate from your personal one. It protects your personal assets and future credit scores.
In South Dakota, banks will require you to submit a copy of your Articles of Organization, operating agreement, and EIN before allowing you to do business banking.
Business banking accounts are generally free, and do not have additional charges or fees.
Business attorney fees in South Dakota
Business attorneys keep LLC formation in South Dakota straightforward. Another benefit of retaining a lawyer is that you will have someone on your side in the case of business-related issues that may come up later.
South Dakota business attorneys typically offer free consultations for first-time clients.
On average, a business lawyer in South Dakota will cost $300 per hour.
LLC taxes in South Dakota
- In South Dakota, LLCs are considered pass-through entities. An LLC owner files personal tax returns rather than their LLC’s tax returns.
- If you sell physical products in South Dakota, you must register for a seller’s permit using the South Dakota Department of Revenue website.
- The South Dakota state tax rate is 4.50%, and the max local and county rate is 4.50%.
- If you hire employees in South Dakota, you must register for the Unemployment Insurance Tax through the South Dakota Department of Labor and Regulation.
- South Dakota does not have a personal income tax, meaning they do not have an employee withholding tax.
- By hiring a tax expert, you are reducing the chance of missed deadlines, penalties, and possible dissolution.
Business licenses and permits in South Dakota
The LLC cost for business licenses and permits in South Dakota will vary depending on where the company is located and the type of business.
You will use the SD.gov Information Gateway to locate the necessary licenses and permits for your LLC.
A business licence in South Dakota varies between $50 to $300. The total cost of permits and licences will depend on where your LLC is, and the type of LLC.
Local government agencies in South Dakota will have different processes and rules for licenses. You will want to contact the office to inquire about the process, price, and office hours.
Some South Dakota LLC formation documents will require a notarization from a notary public.
If you cannot locate one, most government agencies have one in the office.
According to South Dakota state law, a notary public can only charge a max of $10 per act.
Employer obligations in South Dakota
- If you hire employees in South Dakota, you have specific obligations.
- You must verify that your LLC employees are eligible to work legally in the US using Form I-9 from the USCIS Website.
- You must enroll in worker’s compensation insurance.
- You will report all new hires to the state of South Dakota using the State’s Department of Labor and Regulation.
- You can find a complete list of South Dakota employer obligations.
Benefits of a South Dakota LLC
- In South Dakota, business banking is easier when you form an LLC. Banks will require that you open separate personal and business banking accounts. It protects future liability.
- LLCs have different compliance requirements than other business structures. Incorporations must answer to shareholders and stock owners when they make business decisions.
- LLCs are pass-through entities in South Dakota. Owners file personal tax returns rather than the LLC’s tax returns.
- Forming an LLC decreases the chances of being double-taxed as an LLC. C-corporations are double-taxed while LLCs are not.
- South Dakota has state-specific incentives that are available to LLCs. Reinvestment Payment Program and South Dakota Variety Business Benefit Programs are incentives available to LLCs in the state.
How long does it take to register an LLC in South Dakota?
If you register your South Dakota LLC online, the Secretary of State processes it immediately. It will take the state 3 to 5 business days if you process it by mail.
South Dakota does offer 24-hour expedited LLC services for an additional $50.
How do I dissolve my South Dakota LLC?
You must dissolve a South Dakota to avoid ongoing costs. You can file the LLC’s Articles of Dissolution by mail.
The filing fee for LLC cancellation in South Dakota is $10.
Does South Dakota have a publishing requirement?
Unlike Arizona and Nebraska, South Dakota does not have any publishing requirements outside of submitting the LLC’s annual report fee.
Do I need a business operating agreement for my LLC in South Dakota?
You are not required to submit an operating agreement to the Secretary of State. However, having one on file helps reduce the chances of future misunderstandings.
The LLC’s operating agreement can be written or oral as long as it is in the LLC’s files.
Does South Dakota have a franchise tax?
South Dakota does not impose a corporate or annual franchise tax on LLCs.
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