Start an LLC in South Dakota with these Five Easy Steps
- Step 1. Name Your South Dakota LLC
- Step 2. Choose a Registered Agent in South Dakota
- Step 3. File the South Dakota Articles of Organization
- Step 4. Create an Operating Agreement
- Step 5. Get an EIN
Or Simply use a professional:
Northwest ($29 + State Fees)
LegalZoom ($79 + State Fees)
Starting an LLC in South Dakota is Easy
To start a South Dakota LLC you'll need to file the Articles of Organization with the South Dakota Secretary of State, with a starting fee of $150 to file. You can apply online or by mail. The Articles of Organization is the legal document that officially creates your South Dakota limited liability company.
Follow our step-by-step How to Start an LLC in South Dakota guide to get started today. You can learn more about LLCs and their benefits in our What is an LLC guide. To learn how to form an LLC in Spanish, read our Cómo crear una LLC en South Dakota guide.
For more information on how to form an LLC in any state, visit our guide.
STEP 1: Name your South Dakota LLC
Choosing a company name is the first and most important step of forming an LLC in South Dakota. Be sure to choose a name that complies with South Dakota naming requirements and is easily searchable by potential clients.
1. Follow the naming guidelines for a South Dakota LLC:
- Your name must include the phrase “limited liability company” or one of its abbreviations (LLC or L.L.C.).
- Your name cannot include words that could confuse your LLC with a government agency (FBI, Treasury, State Department, etc.).
- Restricted words (e.g. Bank, Attorney, University) may require additional paperwork and a licensed individual, such as a doctor or lawyer, to be part of your LLC.
For a complete list of naming rules in South Dakota, you can read South Dakota's Legislature guidelines.
2. Is the name available in South Dakota? Make sure the name you want isn't already taken by doing a South Dakota LLC name search on the State's website.
To learn more about searching for a South Dakota LLC name, read our full guide.
3. Is the URL available? We recommend that you check to see if your business name is available as a web domain. Even if you don't plan to start a business website today, you may want to buy the URL in order to prevent others from acquiring it.
Find a Domain Now
Now that you have verified your name and secured the URL you may select a professional service to complete the LLC formation process for you. We recommend using one of these professional services:
STEP 2: Choose a South Dakota Registered Agent
You are required to nominate a South Dakota registered agent for your LLC.
What is a Registered Agent? A registered agent is an individual or business entity responsible for receiving important tax forms, legal documents, notice of lawsuits, and official government correspondence on behalf of your business. Think of your registered agent as your business's point of contact with the state.
Who can be a Registered Agent? a Registered Agent must be a resident of South Dakota or a corporation, such as a registered agent service, authorized to conduct business in the state of South Dakota. You may elect an individual within the company including yourself.
Recommended: Northwest provides the first year of registered agent service free with LLC formation ($29 + State Fees)
STEP 3: File the South Dakota LLC Articles of Organization
To register your South Dakota LLC, you'll need to file the Articles of Organization with the South Dakota Secretary of State. You can apply online or by mail.
Now is a good time to determine whether your LLC will be member-managed vs. manager-managed.
File the Articles of Organization
OPTION 1: File Online with the State of South Dakota
- OR -
OPTION 2: File by Mail
State Filing Cost: $150, payable to the Secretary of State. $165 for paper filing. (Nonrefundable)
Secretary of State Office
500 E Capitol Ave
Pierre, SD 57501
For help with completing the form, visit our South Dakota Articles of Organization guide.
If you’re expanding your existing LLC to the state of South Dakota, you will need to form a Foreign LLC.
STEP 4: Create Your South Dakota LLC Operating Agreement
An operating agreement isn’t required for forming an LLC in South Dakota, but it’s a good practice to have one.
What is an operating agreement? An operating agreement is a legal document outlining the ownership and operating procedures of an LLC.
Why are operating agreements important? A comprehensive operating agreement ensures that all business owners are on the same page and reduces the risk of future conflict.
For more information on operating agreements, read our South Dakota LLC operating agreement guide.
Recommended: Download a template or create a Free Operating Agreement using our tool.
STEP 5: Get an EIN for Your South Dakota LLC
What is an EIN? EIN stands for Employer Identification Number. EINs are a nine-digit number assigned by the Internal Revenue Service (IRS) to help identify businesses for tax purposes. It is essentially a Social Security number for a business.
An EIN is sometimes referred to as a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number (FTIN).
Why do I need an EIN? An EIN is required to:
- Open a business bank account
- File and manage Federal and State Taxes
- Hire employees
What if I already have an EIN for my sole proprietorship? The IRS requires that sole proprietorships get a new EIN when converting to an LLC.
Where do I get an EIN? You can get an EIN for free from the IRS. Getting an EIN is an easy process that can be done online or by mail.
FOR INTERNATIONAL EIN APPLICANTS: You do not need a SSN to get an EIN. For more information, read our How to Get an EIN as a Foreign Person guide.
Frequently Asked Questions
What is an LLC?
LLC is short for Limited Liability Company. It is a simple business structure that offers more flexibility than a traditional corporation while providing many of the same benefits. For more information, read our What is an LLC guide.
Watch our video: What is an LLC?
How do I name my South Dakota LLC?
You must follow the South Dakota LLC naming guidelines when choosing a name for your LLC:
- Include the phrase "limited liability company" or one of its abbreviations (LLC or L.L.C.).
- Do not use words that could confuse your business with a government agency (FBI, State Department, CIA, etc.).
- Receive the proper licensing when using the words such as lawyer or doctor.
If you are having trouble coming up with a name for your LLC use our LLC Name Generator. That will not only find a unique name for your business but an available URL to match.
After you get your business name, your next step is getting a unique logo. Get your unique logo using our Free Logo Generator.
Do I need to get a DBA or Trade Name for my business?
Most LLCs do not need a DBA. The name of the LLC can serve as your company’s brand name and you can accept checks and other payments under that name as well. However, you may wish to register a DBA if you would like to conduct business under another name.
To learn more about DBAs in your state, read our How to File a DBA guide.
Can I be my own Registered Agent?
Yes. You or anyone else in your company can serve as the registered agent for your LLC.
Read more about being your own registered agent.
Is a Registered Agent service worth it?
Using a professional Registered Agent service is an affordable way to manage government filings for your LLC. For most businesses, the advantages of using a professional service significantly outweigh the annual costs.
For more information, read our article on South Dakota registered agents.
What is the processing time to form my South Dakota LLC?
Immediately after payment is received online, 1 to 2 business days by mail.
What is the difference between a domestic LLC and foreign LLC?
An LLC is referred to as a "domestic LLC" when it conducts business in the state where it was formed. Normally when we refer to an LLC we are actually referring to a domestic LLC. A foreign LLC must be formed when an existing LLC wishes to expand its business to another state.
Read our What Is a Foreign LLC article to learn more.
How much does it cost to start a South Dakota LLC?
The cost to start a South Dakota LLC is $150 online or $165 by mail.
To learn more, read our guide on the cost to form a South Dakota LLC.
Do I need to file my operating agreement with the state?
No. The operating agreement is an internal document that you should keep on file for future reference. However, many states do legally require LLCs to have an operating agreement in place.
How do I get an EIN if I don’t have a Social Security number?
An SSN is not required to get an EIN. You can simply fill out IRS Form SS-4 and leave section 7b blank. Then call the IRS at (267) 941-1099 to complete your EIN application. Learn more here about applying as an international applicant.
What tax structure should I choose for my South Dakota LLC?
When you get an EIN, you will be informed of the different tax classification options that are available. Most LLCs elect the default tax status.
Do I need an EIN for my LLC?
All LLCs with employees, or any LLC with more than one member, must have an EIN. This is required by the IRS.
Learn why we recommend always getting an EIN and how to get one for free in our Do I Need an EIN for an LLC guide.
What is the minimum wage in South Dakota?
The minimum wage in South Dakota is $9.95 per hour.
How often do I need to pay employees?
South Dakota requires wages to be paid at least once per month on a regular schedule.
Considering Using an LLC Formation Service?
We reviewed and ranked the top 5 LLC formation companies.
Find out which is best LLC service for you.
Important Steps After Forming an LLC
Separate Your Personal and Business Assets
When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your South Dakota LLC is sued. In business law, this is referred to as piercing the corporate veil.
You can start protecting your LLC in South Dakota with these steps:
1. Opening a business checking account:
- Separates your personal assets from your company's assets, which is necessary for personal asset protection.
- Makes accounting and tax filing easier.
Need help finding your EIN for your bank application? Visit our EIN Lookup guide for help.
Recommended: Read our Best Banks for Small Business review to find the best national bank, credit union, business-loan friendly banks, one with many brick-and-mortar locations, and more.
2. Getting a business credit card:
- Helps categorize and separate all business expenses for end-of-year tax purposes.
- Helps build your business credit score — an essential step toward getting a line of credit or business loan in the future.
- Allows you to keep track of department expenses by issuing multiple cards (with multiple budgets) to your employees.
For a closer look at business credit cards and their benefits, check out our review of the best small business credit cards.
Recommended: Visit Divvy to apply for their business credit card and build your business credit quickly.
3. Hiring a business accountant:
- Prevents your business from overpaying on taxes while helping you avoid penalties, fines, and other costly tax errors
- Makes bookkeeping and payroll easier, leaving you with more time to focus on your growing business
- Manages your business funding more effectively, discovering areas of unforeseen loss or extra profit
Recommended: Find out how much you could be saving today by trying our recommended accounting software.
For more business accounting tools, read our guide to the best business accounting software.
Get Business Insurance for Your LLC
Business insurance helps you manage risks and focus on growing your LLC. The most common types of business insurance are:
- General Liability Insurance: A broad insurance policy that protects your business from lawsuits. Most small businesses get general liability insurance.
- Professional Liability Insurance: A business insurance for professional service providers (consultants, accountants, etc.) that covers claims of malpractice and other business errors.
- Workers' Compensation Insurance: A type of insurance that provides coverage for employees’ job-related illnesses, injuries, or deaths. In South Dakota, businesses with one or more employees, including LLC members and corporate officers, are required by law to have workers compensation insurance.
Ready to Protect Your Business?
Get the protection you need with a dedicated small business insurance provider. Find out how much insurance will cost you by getting a quote from our partners at Next Insurance.
Read our review of the best small business insurance companies.
Create Your Business Website
Creating a website is an important step in legitimizing your business. Every business needs a website if you want your customers to find you.
Send Out a Press Release
Press releases are among the easiest and best ways to promote your business. They are also one of the most cost-effective strategies as they:
- Provides publicity
- Establish your brand presence on the web
- Improve your website’s search engine optimization (SEO), driving more customers to your website
- Are a one-time cost in terms of effort and money
- Have long-lasting benefits
Read our review of the best press release services.
Keep Your Company Compliant
South Dakota Business Permits and Licenses
To operate your South Dakota LLC you must comply with federal, state, and local government regulations. For example, restaurants likely need health permits, building permits, signage permits, etc.
The details of business licenses and permits vary from state to state. Make sure you read carefully. Don't be surprised if there are short classes required as well.
Fees for business licenses and permits will vary depending on what sort of license you are seeking to obtain.
Find out how to obtain necessary South Dakota business licenses and permits for your LLC business or have a professional service do it for you:
- Business License Guide: Use our detailed South Dakota Business License guide.
- Federal: Use the U.S. Small Business Administration (SBA) guide.
- State: Use the South Dakota Department of Labor & Regulation website.
- Local: Contact your local county clerk and ask about local business licenses and permits.
Recommended: If you are a first-time entrepreneur, consider having a professional service research your business’s licensing requirements. Read our best business license services review on Startup Savant.
South Dakota LLC Tax Filing Requirements
Depending on the nature of your business, you may be required to register for one or more forms of state tax:
If you are selling a physical product, you’ll typically need to register for a seller's permit through the South Dakota Department of Revenue website.
This certificate allows a business to collect sales tax on taxable sales.
Sales tax, also called "Sales and Use Tax," is a tax levied by states, counties, and municipalities on business transactions involving the exchange of certain taxable goods or services.
Read our South Dakota sales tax guide to find out more.
If you have employees in South Dakota, you will have to register for unemployment insurance tax, known in South Dakota as Reemployment Assistance Tax, on the Department of Labor and Regulation's website.
Federal LLC Tax Filing Requirements
Most LLCs will need to report their income to the IRS each year using:
- Form 1065 Partnership Return (most multi-member LLCs use this form)
- Form 1040 Schedule C (most single-member LLCs use this form)
How you pay yourself as an owner will also affect your federal taxes. Visit our guide to learn more about how to pay yourself from your LLC.
Read our LLC Tax Guide to learn more about federal income taxes for LLCs.
File Your South Dakota LLC Annual Report
South Dakota requires all LLCs to file an annual report with the Secretary of State. This form can be submitted online.
File your Annual Report
File Online with the Secretary of State
Fee: $50 (Nonrefundable)
Note: You will need your business ID to file. LLC business IDs can be searched here: Search for Business IDs
Due Date: Due November 15 each year. The first annual report is due the year following LLC formation.
Late Filings: South Dakota charges a $50 penalty for failure to file on time. In addition, South Dakota can revoke an LLC’s business registration after 60 days for failure to file an annual report.
Avoid Automatic Dissolution
LLCs may face fines and even automatic dissolution when they miss one or more state filings. When this happens, LLC owners risk the loss of limited liability protection. A quality registered agent service can help prevent this outcome by notifying you of upcoming filing deadlines and by submitting reports on your behalf.
If you plan to hire employees for your South Dakota LLC, stay compliant with the law by following these steps:
- Verify that new employees are able to work in the US
- Report employees as "new hires" to the State
- Provide workers' compensation insurance for employees
- Withhold employee taxes
- Print workplace compliance posters and place them in visible areas of your workspace
Find more information at the South Dakota Department of Labor & Regulation.
Recommended: Check out our Hiring for your Small Business Guide for resources like sample job descriptions, payroll service reviews, and more.
Small Business Resources
Get Help Starting a Business in South Dakota
We understand that creating an LLC in South Dakota and getting your business up and running comes with many challenges. To help you succeed, we compiled the best local resources in every major metro area in South Dakota. You can get free assistance in the following areas:
State of South Dakota Quick Links
More South Dakota LLC Information
Register a Foreign LLC in South Dakota
Forming a foreign LLC allows your company to operate as one entity in multiple states. If you have an existing LLC and want to do business in South Dakota, you will need to register as a foreign LLC. This can be done by mail or online.
Register a Foreign LLC in South Dakota
OPTION 1: File Online with the Secretary of State
- OR -
OPTION 2: File by Mail
Fee: $750 Online or $765 by Mail (Nonrefundable)
Secretary of State Office
500 E Capitol Ave
Pierre, SD 57501
How to Obtain a Certificate of Good Standing
A Certificate of Good Standing verifies that your South Dakota LLC was legally formed and has been properly maintained. Several instances where you might need to get one include:
- Seeking funding from banks or other lenders
- Forming your business as a foreign LLC in another state
- Obtaining or renewing specific business licenses or permits
You can order a South Dakota Certificate of Good Standing online.
Order a Certificate of Good Standing in South Dakota
Request a Certificate of Good Standing Online
Fee: $20 (Nonrefundable)
How to Dissolve an LLC in South Dakota
If at any point in the future you no longer wish to conduct business with your LLC, it is important to officially dissolve it. Failure to do so in a timely fashion can result in tax liabilities and penalties, or even legal trouble. To dissolve your South Dakota LLC, there are two broad steps:
- Close your business tax accounts
- File the Articles of Dissolution
When you are ready to dissolve your LLC, follow the steps in our South Dakota LLC Dissolution Guide.