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Perhaps you are hoping to form a South Dakota LLC. People assume that starting an LLC is difficult and costly. However, it’s generally not difficult, and the cost would vary across states. We have all the info you need to know about the cost of forming an LLC, particularly the LLC cost in South Dakota.
On this page, you’ll learn about the following:
South Dakota LLC Cost of Filing
Here are the costs involved in forming an LLC in South Dakota.
Cost of Filing Formation Certificates
The South Dakota Certificate of Formation is responsible for the majority of the cost, which could also vary depending on whether you’re forming a domestic LLC or a foreign LLC. Still, you can file both at the South Dakota Secretary of State.
South Dakota Domestic LLC
- Online Filing costs $150.
- Annual Report filing costs $50
- Name Reservation fee costs $25
- By Mail: Fill out the application form, and send it to Secretary of State Office, 500 E Capitol Ave, Pierre, SD 57501. Costs $165.
South Dakota Foreign LLC
- Online Filing costs $750.
- Annual Report filing costs $50
- Name Reservation fee costs $25
- By Mail: Fill out the application form, and send it to Secretary of State Office, 500 E Capitol Ave, Pierre, SD 57501. Costs $765.
Note that filing online is ideal, not only because you need to go to the Secretary of State office, but also it would be faster. You won’t have to wait in a queue in doing so.
South Dakota LLC Formation Service or Registered Agent Fee
You need a registered agent to form an LLC in South Dakota, hence, added costs for service fees. Here are three of the best LLC services on our list that will provide you with registered agents to ease your worries.
LLC Service | Our Rating & Pricing | Top Features | Learn More |
#1 TOP PICK  | $0 + State Fees |
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Business Permits and Licenses
The business licenses depend on your business’s activity and location and are renewed yearly. As such, the cost will vary. Check the South Dakota Department of Revenue for regulatory boards or agencies requiring licensing.
Taxes payable to the South Dakota Department of Revenue
An LLC in South Dakota has to pay several State as well as Federal Taxes at the stage of formation & during its operation. Read this article to know more about these taxes. The South Dakota State Department of Revenue charges several taxes on an LLC. The two main State Taxes are:
State Income Tax
The state of South Dakota does not charge any State Income Tax on the earnings made by an LLC. Which means more savings on all the income you draw through your LLC.
State Sales & Use Tax
Every LLC which is a service provider or is a seller of tangible goods is bound to the sales & use tax in South Dakota. The LLC has to collect taxes & then pay those to the South Dakota Department of Revenue. The Sales & Use Tax is different in different regions, counties, & cities. The current state sales & use tax rate on LLC in South Dakota is 4.5%
Federal Self-Employment Tax
As the name suggests, Federal Self-Employment Tax is paid by all the LLC Business members or managers. This kind of tax applies to all the earnings a member withdraws from the business.
The Federal self-employment tax rate in South Dakota is 15.3 percent.
Federal Income Tax
The Federal Income Tax is calculated on the basis of the earnings, the income tax bracket your LLC falls, the deductions, & the manner/ mode of filing.
Federal Income Tax is levied on all the profits your LLC makes minus the deductions & allowances such as Healthcare or Retirement Plans.
Employee & Employer Taxes
If you have several employees who draw monthly salaries, there will be some added Employee-Employer taxes. These tax implications vary, depending on various factors, e.g., the amount, number of employees, etc.
Cost Comparison Between States
South Dakota is surrounded by many states, namely Nebraska, Wyoming, Montana, North Dakota, etc. Each of these states has a different rate of taxes levied on LLCs. Let us take a look at this comparative chart.
| States | Filing Fee | Annual/Biennial Fee | Sales Tax |
| South Dakota | $150 | $50 | 4.5% |
| Nebraska | $125 | Not required | 5.5% |
| Wyoming | $102 | $50 | 4% |
| Montana | $70 | $10 | None |
| North Dakota | $135 | $50 | 5% |
Based on the kind of industry you LLC operated in, your LLC will be liable to some other taxes & duties. For Example, if your LLC is in the sector of import & export, you have to pay the import-export duty. You should consult with a professional to verify the tax rates or business costs of registering an LLC in South Dakota.
Other Costs
- South Dakota Name Reservation: $25 by mail
- Doing Business As (DBA): $10 for online filling
- Certified Document Copies: $15 + $2 per page.
- Certified of Good Standing: $20
- Business Domain Name and Website: depend on your preference, but domain name could be as low as $2.99/yr at NameCheap, and web hosting is at least $30/mo at Kinsta.
- Online workspace: at least $4.20/mo for GSuite.
- Business Insurance: would vary depending on insurance type–whether general liability insurance or professional liability insurance–and coverage.
- Dissolution of South Dakota LLC: $10
F.A.Qs
It is possible to form an LLC without professional help, but forms still have associated costs, regardless of where your LLC is formed.
It is difficult to say whether forming an LLC is expensive. Nevertheless, the cost could be anywhere from $40 to $500. If you refuse to hire professionals, you’ll still have expenses like form fees to cover.
The need to separate personal money from business funds, thus necessitating the creation of a business bank account for your LLC.
How Much Does It Cost to Maintain an LLC in South Dakota
To maintain an LLC in South Dakota you will need to pay an annual fee of $50 along with state sales & use tax at 4.5% and federal taxes.
One of the key costs associated with maintaining an LLC in South Dakota is the annual report fee. Each year, LLCs in the state are required to file an annual report with the Secretary of State, along with a filing fee. This fee can vary depending on the state of the LLC and it can also change from year to year, so business owners should be aware that this is an ongoing cost of maintaining their LLC.
Another important expense to consider is the cost of registered agent services. In South Dakota, as in most states, LLCs are required to have a registered agent who is responsible for receiving legal documents and official correspondence on behalf of the LLC. This service is typically provided by a third-party company, and the cost can vary depending on the provider and the level of service required.
In addition to these ongoing expenses, LLCs in South Dakota may also incur costs for additional services such as obtaining a business license, renewing insurance policies, and paying any applicable business taxes. These expenses can add up quickly, so business owners should be prepared to budget for these costs in addition to the basic maintenance fees for their LLC.
While these costs may seem daunting, it is important for business owners to remember that maintaining an LLC in South Dakota also comes with several advantages. For example, LLCs offer limited liability protection, which can help shield business owners’ personal assets from legal claims or debts incurred by the business. Additionally, LLCs in South Dakota benefit from the state’s low taxes and overall pro-business environment, making it a desirable choice for many entrepreneurs.
Ultimately, while maintaining an LLC in South Dakota may require some financial investment, the benefits of operating as an LLC often outweigh the costs. By understanding the various expenses involved and planning accordingly, business owners can ensure that their LLC remains in good standing and can continue to thrive in South Dakota’s business-friendly environment.
In Conclusion
The cost of South Dakota is much lower compared to other forms of business. Apart from the state filing fees and annual taxes, you might bear the cost of the registered agent. Compare the price of professional LLC services and choose the most affordable one.