Start an LLC in South Dakota Today, Easily and for Free
Tailor Brands stands out among top business formation providers, delivering exceptional service and forming 500k+ businesses, making it a reliable choice for your South Dakota LLC.
You can set up your LLC in South Dakota confidently—no service fees, no hassle.
From $0 + State Filing Fees
Create your LLC in South Dakota and other states completely free, with zero formation costs.
Unlock access to a free business coaching program to help launch and grow your new South Dakota LLC.
Handle tax filing, bookkeeping, branding, and more with Tailor Brands’ 20+ expert business services.
Things to Know Before Starting an LLC in South Dakota
There are several important regulations to consider before forming an LLC in South Dakota. Understanding these requirements will help you make informed decisions and ensure compliance with state laws.
Let’s briefly discuss some key requirements.
- If your LLC is established in another state and you wish to conduct business in South Dakota, you’ll need to register as a foreign LLC. Otherwise, you can simply register a domestic LLC in South Dakota.
- All South Dakota LLCs must file an annual report to maintain good standing. The filing fee is $50 for online submissions and $65 for paper filings. Late submissions incur a $50 penalty.
- South Dakota doesn’t impose a corporate income tax, which can be beneficial for LLC owners. Additionally, the state offers strong privacy protections and minimal bureaucracy for business owners.
- If you hire employees for your LLC in South Dakota, you need to pay state unemployment insurance taxes, known as Reemployment Assistance Tax. New employers typically start with a rate of 1.75%.
Staying compliant with South Dakota’s regulations is crucial for the success of your limited liability company. Tailor Brands offers services to assist with both the formation and ongoing compliance requirements of your LLC in South Dakota.
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How to Form an LLC in South Dakota
Starting an LLC in South Dakota is relatively straightforward, mainly thanks to the state’s business-friendly regulations.
Here’s the step-by-step process for forming an LLC in South Dakota:
1. Select a Business Name
The first step in forming your LLC in South Dakota is choosing the right business name. This must not already be in use by another registered entity. It also must include a legal ending like “Limited Liability Company,” “LLC,” or “L.L.C.”
To avoid delays in registration, ensure the name doesn’t violate any trademark laws or state naming rules. You can use the South Dakota Secretary of State’s business name search tool to check availability before moving forward.
2. Reserve Your Business Name
Reserving your LLC name isn’t mandatory in South Dakota, but it can be helpful if you’re not ready to file your formation documents. You can reserve the name for 120 days by filing an Application for Reservation of Name and paying a $25 fee.
This step ensures your chosen name remains protected while you finalize the details of your limited liability company. It also gives you time to secure a matching domain, even if you don’t plan on creating a website immediately, and handle branding before registering your business name.
3. Appoint a Registered Agent
South Dakota law requires every limited liability company to designate a registered agent to receive official and legal documents. This person or entity must have a physical address in South Dakota and be available during regular business hours.
You can appoint yourself, a trusted individual, or a professional service like Tailor Brands to fulfill this role. Using a registered agent service offers more privacy and ensures you never miss critical compliance notices or deadlines.
4. File the Articles of Organization
To officially register your LLC in South Dakota, you must file the Articles of Organization with the Secretary of State. This document includes your LLC’s name and management structure, and can be filed online for $150 or by mail for $165.
In South Dakota, LLCs can either be member-managed or manager-managed. If you prefer direct control, a member-managed structure is ideal. However, if you’d rather designate managers to oversee operations, opt for a manager-managed LLC.
5. Create an Operating Agreement
An Operating Agreement outlines ownership percentages, responsibilities, structure, and internal operations of your limited liability company. While not required by South Dakota law, having one helps prevent future conflicts between members and shows professionalism.
It also defines voting rights, the distribution of profits and losses, and what happens if a member leaves. Even single-member LLCs benefit from having an agreement, especially when opening a business bank account or facing legal scrutiny.
6. File for a DBA
If you plan to operate under a name different from your LLC’s legal name, you must register a Doing Business As (DBA) name with the South Dakota Secretary of State. This allows your LLC to use a trade name while maintaining its legal identity.
You can file your fictitious name application or amend it online for a $10 fee. No fee applies for cancelling a DBA. Your DBA registration is valid for five years and must be renewed before expiration to maintain the right to use the name.
7. Obtain an Employer Identification Number
An Employer Identification Number (EIN) is a nine-digit number issued by the IRS to identify your business for tax purposes. This is essential if you plan to hire employees, open a business bank account, or choose a specific tax classification.
You can apply for an EIN for free through the IRS website, or via mail, fax, or phone (for international applicants). Applying for a tax ID online is the fastest method, as it grants immediate approval upon submission.
8. Open a Business Bank Account
Opening a dedicated business bank account is critical to separate your personal and LLC finances, which prevents “piercing the corporate veil”. It helps preserve your liability protection, simplifies bookkeeping, and supports better tax preparation. A separate business account also improves your company’s professional image and creditworthiness. That said, remember that most banks require your EIN, Articles of Organization, personal identification, and sometimes your Operating Agreement to open an account.
9. Apply for Business Licenses and Permits
South Dakota doesn’t require a statewide general business license, but your LLC may still need permits based on your industry or location. Common examples include sales tax licenses for retail businesses, health permits, or contractor licenses.
Check with your city or county offices, and the South Dakota Department of Labor and Regulation (DLR), to ensure full compliance. Failing to obtain proper licenses can lead to fines or even the suspension of your business operations.
10. Register for State Taxes
South Dakota is known for its business-friendly tax climate with no corporate income, personal income, personal property, or business inventory tax. However, you may need to register to collect sales tax if you’re selling goods and services.
Additionally, South Dakota employers must pay unemployment tax, known as Reemployment Assistance. Other common business taxes your limited liability company may need to comply with include use tax and municipal sales tax.
11. File the Annual Report
South Dakota LLCs must file an annual report with the Secretary of State to confirm or update their business information. This report must be submitted with a filing fee by the first day of the anniversary month of your LLC’s formation date.
The filing fee is $50 online and $65 by mail. Failing to file your annual report on time may cause your limited liability company to be administratively dissolved. If this happens, you’ll need additional paperwork and a $50 penalty to reinstate your business’s legal status.
12. File a BOI Report
As of 2024, LLCs must file a Beneficial Ownership Information (BOI) report with FinCEN unless they’re exempt. In South Dakota, any limited liability company owning agricultural land must disclose if it has foreign beneficial owners, as per state law.
This step promotes transparency and helps prevent misuse or unauthorized foreign control. Business formation services like Tailor Brands can assist with BOI report filing to ensure full compliance at the federal and state levels.
13. Develop a Business Website
A professional business website helps build credibility, attract customers, and strengthen the online presence of your LLC in South Dakota. This allows potential clients to easily find information about your services, hours, and contact details.
Even a simple website built with an affordable website builder is a powerful marketing tool for your South Dakota LLC. Include customer testimonials, service descriptions, and your company’s background to build trust with potential clients.
14. Maintain Ongoing Compliance
To keep your LLC in South Dakota legally protected and in good standing, you must stay compliant with state and federal requirements. This includes filing your annual report, renewing business licenses, and ensuring records are accurate.
You can also request a Certificate of Good Standing to prove your limited liability company’s active status when applying for financing or contracts. To make sure you’re on top of everything, Tailor Brands can help you manage ongoing compliance tasks.
Why Should You Outsource LLC Formation Services?
Starting an LLC in South Dakota—navigating paperwork, deadlines, and legal requirements—can be challenging. Here’s why partnering with professional formation services like Tailor Brands makes sense.
Simplified Process
Hiring experts ensures your LLC formation proceeds without complications or delays.
From business name checks to filing your Articles of Organization, every step is handled quickly and correctly. You won’t need to dig through legal requirements or chase paperwork. The entire setup is done clearly and easily, often in just a few clicks.
Error-Free Filing
Mistakes in your formation documents can cause costly setbacks and complications.
Incorrect or incomplete documents delay your LLC’s approval or trigger legal complications. Outsourcing ensures that forms are accurate, compliant with South Dakota law, and submitted properly the first time, keeping your business plans on track.
Fast Turnaround
Time saved during formation directly contributes to faster business operations.
Experts know how to fast-track your paperwork and work efficiently with state systems. You’ll get confirmation, documentation, and next steps faster, so your limited liability company can complete the startup checklist and start operating quickly.
Benefits of Starting an LLC in South Dakota
Forming an LLC in South Dakota provides limited liability protection similar to a corporation while remaining easier to form, manage, and dissolve.
Here are some key benefits of forming an LLC in South Dakota.
Limited Personal Liability
An LLC in South Dakota protects your personal assets from business debts and legal claims. If your business is sued or faces financial hardship, your home, savings, and other personal property generally remain protected from liability.
South Dakota has strong asset protection laws that reinforce this separation between personal and business finances. This level of protection makes the LLC structure a safe and reliable option for risk-conscious entrepreneurs.
Simple and Affordable Formation
Creating an LLC in South Dakota requires minimal paperwork and reasonable filing fees compared to many other states. South Dakota’s streamlined formation process is complemented by a low annual report cost of $50 to maintain good standing.
This cost-effectiveness and simplicity reduce administrative overhead and allow business owners to focus on growth rather than paperwork. It’s essentially what makes South Dakota an attractive location for LLC formation.
Ownership Flexibility
South Dakota LLCs offer remarkable versatility in ownership structure, allowing for single-member or multi-member ownership. Several types of individuals, including foreign nationals, other LLCs, corporations, or a mix of member types, can own them.
The number of members in your LLC isn’t limited, so it’s more flexible compared to sole proprietorships and partnerships. This way, you can easily structure ownership to fit your business goals and investor needs.
Flexible Management Structure
A South Dakota LLC can be member-managed or manager-managed. This way, you can choose how you want to run your business. You can either run the business yourself or delegate responsibilities to professional managers.
Your chosen structure doesn’t affect liability protection, tax benefits, or ownership interests. It simply allows you to organize your LLC in South Dakota in a way that matches your operational style without triggering complex reorganizations.
Robust Tax Advantages
One of the biggest perks of forming an LLC in South Dakota is that there’s no state income tax. This means South Dakota LLC owners can retain more of their profits, making it one of the most tax-friendly states to launch a business.
Additionally, South Dakota has no franchise or business inventory tax, so businesses have a lesser financial burden. This favorable tax environment ensures your LLC in South Dakota can enjoy some of the lowest operational costs nationwide.
Flexible Tax Options
Your LLC in South Dakota benefits from federal tax flexibility and can take advantage of pass-through taxation by default. This means profits and losses pass through to members’ personal tax returns to avoid double taxation.
You can also elect corporation or S-Corporation taxation if it better optimizes your tax benefits or suits your financial strategy. The ability to choose your tax structure gives you control over how the IRS treats your business income.
Credibility and Branding Advantages
Operating as an LLC in South Dakota enhances business legitimacy in the eyes of customers, vendors, and potential partners. It signals professionalism, making it easier to establish beneficial business relationships and secure favorable terms.
Thanks to the confidence created by the legal recognition and permanence of LLC status, it’s also easier to access funding and business credit. Investors and lenders tend to prefer working with formal structures over sole proprietors or informal partners.
Perpetual Existence
Unlike sole proprietorships or partnerships that dissolve upon owner death or withdrawal, an LLC in South Dakota can continue indefinitely. This perpetual existence creates stability to ensure that operations continue seamlessly.
Ownership transfer is also simplified, allowing members to sell or pass on their interests without dissolving the limited liability company. This makes it much easier to sell the business, add partners, or engage in long-term planning for your business.
Tailor Brands South Dakota LLC Formation Services: Free + Paid Plans
Tailor Brands has over a decade of experience helping entrepreneurs launch and grow businesses, with thousands of companies formed through its platform. It offers a free LLC formation plan and premium options that bundle helpful tools for branding, compliance, and growth.
Here’s a quick breakdown of its plans:
Lite Plan
The Lite Plan is Tailor Brands’ free tier offering. It’s perfect for basic LLC formation in South Dakota. Here’s what it includes:
- LLC Formation: Tailor Brands prepares and files your Articles of Organization within 14 days at no cost. It ensures your LLC in South Dakota meets state requirements.
- Business Coaching Program: Receive valuable guidance and development tips to help grow your LLC in South Dakota effectively, without the usual entrepreneurial stress.
- Invoicing and Bookkeeping: Enjoy a 30-day free trial of essential financial tools to help you easily manage income, expenses, and taxes for your South Dakota LLC from day one.
Price: $0 + state filing fees
Essential Plan
Building on Tailor Brands’ free tier, the Essential Plan adds premium features for entrepreneurs seeking faster service and additional benefits. Here’s what it includes:
- Expedited LLC Formation: Tailor Brands helps you fast-track the formation of your LLC in South Dakota within just two business days.
- Compliance Tracking: Receive timely alerts and guidance to stay up-to-date with annual reports and filings for your LLC in South Dakota.
- $30 Amazon Gift Card: Enjoy a welcome bonus you can use to buy business essentials and supplies as you get your LLC in South Dakota started.
- Operating Agreement: Customize your limited liability company’s internal structure with a professional, ready-to-use LLC operating agreement.
Price: $199/year + state filing fees
Elite Plan
The Elite Plan, Tailor Brands’ premium offering, provides South Dakota LLC owners with comprehensive formation services plus extensive branding tools, including:
- $50 Amazon Gift Card: This generous bonus helps equip your new LLC in South Dakota with the necessary supplies.
- One-Year Free Domain: Secure your business name online with a reputable domain for your South Dakota LLC’s web presence.
- Eight Free Logo Designs: Choose from professionally generated logo options to establish the visual identity of your South Dakota LLC.
- DIY Website Builder and Online Store: Create a polished professional website or ecommerce store for your LLC in South Dakota.
- Social Media Post Maker: Create engaging, branded content that promotes your LLC in South Dakota across various social platforms.
- Business Card Design Tools: Develop professional digital and physical business cards for your LLC in South Dakota.
Price: $249/year + state filing fees
Additional Tools and Services from Tailor Brands
Tailor Brands offers helpful add-ons to support and streamline the management of your LLC in South Dakota.
Here are some of the available services when starting your limited liability company.
EIN Assistance
Tailor Brands helps you apply for an Employer Identification Number (EIN) so your LLC in South Dakota can pay taxes, hire employees, and open business accounts. The process is quick and accurate. It also ensures your business meets IRS requirements from day one.
Registered Agent
Your LLC in South Dakota must designate a registered agent to receive legal notices and state correspondence. Tailor Brands offers reliable agent services to ensure you never miss important documents, lawsuits, or deadlines that could affect your legal standing.
Tax Support
Filing taxes for an LLC in South Dakota doesn’t have to be stressful. Tailor Brands offers support with federal and state filings, helping you minimize tax liabilities and stay compliant throughout the year. This is especially helpful if it’s your first time owning a small business.
Trademark Service
Protecting your brand identity is essential when running a limited liability company in South Dakota. Tailor Brands helps you file a trademark quickly and affordably, keeping your business name, logo, and other assets safe and distinctive from competitors and any copycats.
Licenses & Permits
Tailor Brands helps your LLC in South Dakota identify and apply for all required licenses and permits, including the South Dakota sales tax permit. Get personalized guidance based on your location, industry, and operations, ensuring the legal operation of your limited liability company.
Legal Documents
Your LLC in South Dakota can access customizable legal documents, including contracts, NDAs, and Operating Agreements. Tailor Brands provides attorney-approved templates that save you time and reduce costs since you don’t need to hire third-party legal services.
Business Banking
Open a dedicated bank account to keep your South Dakota limited liability company’s finances separate from personal assets. Tailor Brands partners with trusted banking providers, offering simple setup, low fees, and tools like capital solutions tailored for small business needs.
Business Email
Give your LLC in South Dakota a professional edge with a custom business email address. Tailor Brands makes it easy to set up and manage branded email that enhances trust and credibility with customers, vendors, and partners, strengthening your business reputation.
Why Choose Tailor Brands to Form an LLC in South Dakota
Tailor Brands is a trusted LLC formation service provider with a proven track record of helping over 500,000 businesses successfully launch. Its comprehensive understanding of South Dakota’s LLC formation process makes it an ideal partner.
Free Formation, No Hidden Fees
Forming an LLC in South Dakota doesn’t need to come with surprise fees, confusing terms, or irritating upsells.Tailor Brands offers a transparent, no-cost LLC formation option with absolutely no hidden charges or upsells—issues plaguing its competition. You only pay the mandatory state filing fees to enjoy services like Articles of Organization filing and compliance alerts.
Effortless User Experience
Navigating the paperwork and compliance process for an LLC in South Dakota can be intimidating.,Tailor Brands simplifies everything with an intuitive interface that walks you through each step. It automates form completion, deadline reminders, and filings. With this, it’s simpler to start your LLC in South Dakota—just answer a few questions and click submit.
Expert Guidance and Business Tools
Tailor Brands doesn’t just form your LLC in South Dakota. It also provides tools for business management and growth.From EIN assistance to legal templates, Tailor Brands keeps you compliant and professional. With over 10 years in business, its experience ensures your LLC in South Dakota is formed smoothly and managed easily, even if you’re a first-time business founder.
FAQ
The cost of forming an LLC in South Dakota depends on whether you’re registering a domestic or foreign LLC.
The filing cost to start a domestic LLC in South Dakota is:
- $150 for online filing via the Secretary of State’s website
- $165 for paper/mail-in submissions (includes $15 paper filing fee)
For foreign LLCs registering to do business in South Dakota, the cost is:
- $750 for the Certificate of Authority when filed electronically/online
- $765 if the foreign Certificate of Authority is filed via paper
Beyond the initial filing fees, South Dakota LLCs face several ongoing costs. Every LLC must file an annual report with a $50 fee, due by the first day of your anniversary month of formation.
You’ll also need a registered agent service, which can range from no cost (if you serve as your own agent) to approximately $300 or more annually if using a commercial provider.
The processing time to form an LLC in South Dakota is relatively quick, especially if you file online. Most online submissions are processed within one to two business days, making this the fastest and most efficient option.
If you submit your documents by mail, the timeline extends. Paper filings are processed within three to five days, depending on the workload of the Secretary of State’s office. It’s important to account for mailing time in addition to internal processing.
Using a professional LLC formation service can speed things up. Tailor Brands, for one, offers expedited filing, ensuring your documents are processed within two days. However, final approval still depends on the state’s system.
South Dakota is widely regarded as one of the most tax-friendly states in the US, particularly for LLCs. Here are some of its key tax benefits:
- No business inventory tax
- No corporate income tax
- No personal income tax
- No inheritance tax
- No franchise tax
Compared to states with high annual franchise taxes or steep business income rates, South Dakota allows LLCs to retain more of their earnings.
Because South Dakota LLCs don’t have to pay state personal income taxes, owners’ business profits pass through to their personal returns. Additionally, at 4.2%, South Dakota has a relatively low state sales tax rate.
Here’s a breakdown of the process for forming an LLC in South Dakota:
- Select a Business Name: Choose a unique and distinguishable name for your LLC in South Dakota that meets state naming rules. The name must include “Limited Liability Company” or an approved abbreviation like “LLC.”
- Reserve Your Name: Although optional, reserving a business name prevents others from registering it while you finalize paperwork. South Dakota allows name reservations for 120 days, ensuring availability during formation.
- Appoint a Registered Agent: Every LLC in South Dakota must designate a registered agent to receive legal documents. The agent must have a physical address in the state and be available during business hours.
- File the Articles of Organization: Filing this document with the South Dakota Secretary of State legally establishes your LLC. The Articles require basic information about your business, including name and registered agent details.
- Create an Operating Agreement: An Operating Agreement outlines how your South Dakota LLC will be run and managed. While it’s not mandatory in South Dakota, it helps prevent disputes and clarifies internal responsibilities.
- File for a DBA: If your LLC in South Dakota will operate under a name other than its legal one, you need a DBA. Also called a “Fictitious Business Name,” it must be registered with the state and renewed every five years.
- Obtain an Employer Identification Number: Apply for an EIN from the IRS to legally hire employees, open a business bank account, or file taxes. Every LLC in South Dakota must obtain one, even single-member entities.
- Open a Business Bank Account: Establishing a separate bank account for your LLC in South Dakota improves financial clarity. It also protects your personal assets by reinforcing the legal separation between you and your LLC.
- Apply for Business Licenses and Permits: Depending on your business type and location, your South Dakota LLC may need specific licenses or permits. Research what applies to you at the federal, state, and local levels.
- Register for State Taxes: While South Dakota doesn’t have state income tax, you might need to register your LLC for sales tax if selling goods or certain services. You also need to register for employer taxes if hiring employees.
- File the Annual Report: Every LLC in South Dakota must file an annual report to maintain active status. This incurs a $50 filing fee (plus $15 for paper filing). Reports are due by the first day of the LLC’s anniversary month of formation.
- File a BOI Report: For transparency, South Dakota LLCs must file a federal BOI (Beneficial Ownership Information) report with FinCEN. If your LLC owns agricultural land and has foreign owners, you’ll also need a state-level report.
- Develop a Business Website: A well-designed website improves the credibility and branding for your LLC in South Dakota. Fortunately, Tailor Brands can help with domain registration and website or e-store design.
- Maintain Ongoing Compliance: To keep your South Dakota LLC in good standing, meet all annual filing deadlines and update state records as needed. This includes maintaining a registered agent and renewing permits promptly.
A BOI report is a disclosure requirement established under the federal Corporate Transparency Act (CTA). It’s part of a national regulation designed to enhance financial transparency and combat money laundering, terrorist financing, and other financial crimes.
So, do you need to file one for your LLC in South Dakota? Yes, most South Dakota LLCs are required to file a BOI (Beneficial Ownership Information) report. In some cases, they must file two separate reports—one federal and one state-level.
For LLCs created after January 1, 2024, you must file your initial report with the Financial Crimes Enforcement Network (FinCEN) within 90 days of formation.
South Dakota has an additional reporting requirement for LLCs that own agricultural land. If your LLC owns or is planning to acquire farmland and has any foreign beneficial ownership, the state requires you to file a disclosure report.
Form an LLC in South Dakota for Free with Tailor Brands
Starting an LLC in South Dakota can feel overwhelming with all the paperwork, filings, and legal requirements involved.
However, with expert support and user-friendly tools, Tailor Brands helps you launch your dream business with peace of mind.
$0 + State Filing Fees