How Much Does an LLC Cost in South Dakota

It costs at least $150 to form an LLC in South Dakota. But these additional expenses could increase the total to over $3,000.

South Dakota, with its vast prairies and fertile fields, offers more than just scenic beauty.

In the land of infinite variety, profits aren't taxed away, regulations are minimal, and a strong work ethic is rooted in the culture. If this sounds appealing, forming an LLC in South Dakota might be right for you.

But how much does it cost to form an LLC in South Dakota? This in-depth guide breaks down the expenses, starting with the one-time state filing fee.

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Articles of Organization

One-Time Fee: $150 (online) | $165 (paper)^[1]

To form an LLC in South Dakota, you must submit the Articles of Organization to the Secretary of State. Once the documents are approved, your LLC will be recognized as a separate legal entity.

A South Dakota LLC's Articles of Organization contains the following information, among other details:^[2]

• Limited liability company name
  
• Business purpose
  
• Office address
  
• Registered agent name and address
  
• Organizer's name and address

You can file the Articles of Organization online, by mail, or in person. Online filings are typically processed as soon as they're received.^[3]

Certificate of Authority

One-Time Fee: $750 (online) | $765 (paper)^[1]

If you already have an LLC in another state and want to expand your business to South Dakota, register it as a foreign LLC.

To create a foreign LLC in South Dakota, you must file a Certificate of Authority with the Secretary of State. Don't forget to attach a Certificate of Good Standing from your domestic state.

Annual Report

Annual Fee: $50 (online) | $65 (paper)^[1]

All LLCs in South Dakota must file annual reports with the Secretary of State. It lets the government, banks, and anyone who can access public records know that your business is still active.

In South Dakota, annual reports are due on the first day of the LLC's anniversary date.^[3] For example, if you filed the Articles of Organization on September 21, 2024, the annual report is due by September 1 yearly.

Business Permits and Licenses

Cost: Typically $50+

South Dakota does not have a state-level general business license. Instead, it prefers to leave business licensing requirements to local jurisdictions and specific industries.

In Sioux Falls, the largest city in South Dakota, business licenses range from $50 to $500+ depending on the type of business.

In Rapid City, a tourist destination and the second-most populous city in the state, business permits typically cost upwards of $50.

The number of permits and licenses your LLC needs depends on its business purpose. Some businesses may be regulated by various governmental offices simultaneously and could renew yearly.

Business Taxes

Cost: 10% to 37% of taxable income^[4]

South Dakota is one of the few states that doesn't charge a state income tax. However, since the LLC's profits are passed on to its owners, you must still pay the federal income tax based on your taxable income.

Federal Income Tax Rates:^[5]

Don't forget the 15.3% federal self-employment tax.^[6]

Optional Fees

While the fees below are generally optional, some are unavoidable depending on your business needs.

For example, obtaining a Certificate of Good Standing is often necessary when opening an LLC bank account.

Expedited Services

Cost: $50^[1]

South Dakota offers expedited services for most of its filings. If you pay the fee, the Secretary of State will prioritize processing your documents sooner than the state's processing times.

However, South Dakota doesn't specifically state how long it takes to process your documents, even with expedited services. That said, make sure to file your Articles of Organization as early as possible.

Registered Agent Services

Annual Cost: $0, or $100-$300/yr

In South Dakota, you must have a registered agent to receive business and legal documents for your LLC. This includes government notices, tax forms, and annual reporting forms.

You can technically be your LLC's registered agent—as long as you're at least 18 and have a physical street address in South Dakota. You must also be available to receive documents during business hours.

However, your address will be public record. So many LLCs like to hire a registered agent service to keep their personal details private. These services usually charge $100-$300 per year to be your registered agent.

Change of Registered Agent

Cost: $10^[1]

In South Dakota, an LLC can change its registered agent's details by filing a form with the Secretary of State. Changes include the registered agent's name and address.

Operating Agreement

Cost: $0, or up to $500+

LLCs in South Dakota are not required to have an operating agreement. However, it's recommended because it defines important rules and regulations that all members must follow.

An LLC operating agreement contains the following:

• The roles and responsibilities of each member
  
• How new or departing members will be treated
  
• How business profits and losses will be divided

Ideally, you should already have a signed Operating Agreement before forming an LLC in South Dakota. But if your LLC is already formed, you can always draft it yourself after.

Alternatively, an LLC attorney might charge you a $500 flat fee for a standard operating agreement. If you have more complex details, the cost could be higher.

Employer Identification Number

Cost: $0, or $50 to $99

Any LLC with more than one member or with employees must have an EIN, regardless of how it's taxed. This is a unique nine-digit number assigned by the Internal Revenue Service (IRS) to identify a business entity for tax-related purposes.

You can just apply for an EIN for free on the IRS website. But if you'd like an LLC service to process it for you, you can do so for a small fee. Here are some providers that do this and their pricing:

• Northwest Registered Agent: $50
  
• Bizee: $70
  
• ZenBusiness: $99

Single-member LLCs in South Dakota don't require an EIN, but it's almost essential in practice. For instance, you'll need one if you hire employees or want to open a business bank account.

BOI Report

One-Time Cost: $0, or up to $149

The Beneficial Ownership Information (BOI) is a one-time report that must be submitted to the Financial Crimes Enforcement Network (FinCEN) within 90 calendar days of your LLC's formation.^[7]

It includes information about the LLC's beneficial owners, including name, birth date, and address.

FinCEN doesn't charge a fee to submit your BOI report. But you can pay an LLC service to process it for you and save yourself the hassle:

• Northwest Registered Agent: $25
  
• LegalZoom: $149
  
• ZenBusiness: $149

You're considered a beneficial owner if you own 25% or more of the ownership interests in your LLC. Or if you exercise substantial control over the LLC.

Name Reservation

Cost: $25^[1]

You can reserve your desired name first if you've already got a business name but aren't ready to form an LLC. This will prevent others from using that name for 120 days.^[8]

If you need more time, renew the name reservation for the same fee and get another 120 days. However, this can only be done 60 days after the first name reservation's expiry date.^[8]

Remember to review South Dakota's naming regulations. For example, an LLC name must include LLC, Ltd., or similar.

Fictitious Name

Cost: $10^[1]

A fictitious name (also known as "Doing Business As" or DBA) allows your LLC to operate under a name different from its legal name registered with the state.

Some LLCs use a DBA for branding purposes. It's also ideal if you want to use a name without "LLC" at the end.

In South Dakota, a DBA must be renewed every five years for as long as the business uses it.^[9]

Articles of Amendment

Cost: $60^[10]

Your South Dakota LLC's Articles of Organization contains specific details about your business. Should these details change, you must file an amendment to the Secretary of State.

File the Articles of Amendment if you:

• Change the LLC name
  
• Have a new business address
  
• Appoint a new registered agent

You must also file a change of registered agent form with the $10 filing fee if you update your registered agent's details. Some registered agent services shoulder this fee for new customers.

Certificate of Good Standing

Cost: $20 (online) | $35 (paper)^[1]

A Certificate of Good Standing is an official document by the Secretary of State. It verifies that your LLC is updated with all state filings and has paid all its fees and taxes.

You might need a Certificate of Good Standing to:

• Open a bank account
  
• Apply for business loans
  
• Qualify for business insurance
  
• Conduct business as a foreign LLC

Certified Copies

Cost: $15 + $2 per page^[1]

Certified copies of documents verify that your LLC is legitimate and that its details are accurate.

You might need these for circumstances like opening a business bank account or expanding your LLC in another state.

Additionally, some LLCs keep certified copies of their initial Articles of Organization and amendments (if any) for recordkeeping purposes.

Business Website Domain

Annual Fee: $10 to $20

A website domain and social media presence provide dedicated online spaces for your business. It's essential for marketing, customer engagement, and brand visibility in today's digital world.

Even if you aren't planning to build a business website now, you could still buy the domain name. This will prevent others from using your LLC's name as a web address.

Business Insurance Premiums

Cost: Varies

South Dakota is one of the few states that does not require workers' compensation insurance.^[11] However, having one is highly recommended to prevent significant financial losses.

Additionally, consider protecting your LLC's assets with other types of insurance:

• General liability insurance
  
• Commercial property insurance
  
• Professional liability insurance
  
• Cyber liability insurance

The cost depends on factors like the number of employees, the risk level of your industry, and your past insurance claims.

Bottom Line

Forming an LLC in South Dakota requires at least $150 for the Articles of Organization state filing fee.

Your expenses in the first year might also include:

• $25 business name reservation
  
• $10 DBA name registration
  
• $50+ business permit and license fees

That said, expect to shell out $235 or more to form an LLC in South Dakota. Ultimately, it's never a bad idea to set aside an extra budget for unexpected fees.

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