Start Your LLC In
South Dakota with One IBC
Got Questions? Call (949) 524-4399 to talk to a business expert.
Discover the Perfect Plan for Your Company
Basic
$199
Fees for filing legal documents to register or maintain a business.
02 weeks processing
Agent fee
Registered Address
Document filing with the Secretary of State
Standard
$499
Fees for filing legal documents to register or maintain a business.
05 days processing
Includes everything in basic package
Comprehensive name check
Preparation of Articles of Incorporation
Lifetime customer support (phone & email)
Federal Tax ID (EIN) Obtainment Service
Premium
$599
Fees for filing legal documents to register or maintain a business.
01 day processing
Includes everything in standard package
2 hours of free tax consultation
Key Points for South Dakota LLCs
No State Income Tax
South Dakota is one of the few states with no personal or corporate income tax, making it highly attractive for LLC owners seeking tax efficiency.
Strong Asset Protection
The state provides strong liability protection and privacy for LLC members and managers.
Business-Friendly Regulations
With low startup costs, simple compliance requirements, and a reliable online filing system, South Dakota offers an ideal environment for startups and remote businesses.
Understanding South Dakota LLCs
A South Dakota LLC combines liability protection with management and tax flexibility. It’s especially appealing for business owners seeking to avoid state income tax while benefiting from straightforward filing and maintenance.
What is a South Dakota LLC?
A South Dakota LLC is a legal entity formed by filing Articles of Organization with the Secretary of State. It must have a South Dakota registered agent and can be structured as member-managed or manager-managed.
A South Dakota LLC offers several benefits, including:
No state personal or corporate income tax. Low annual report fee. Limited liability protection for members. Flexible tax and management structure.
Why choose an LLC in South Dakota?
Business owners select South Dakota because of its tax-friendly policies, asset protection, and low-cost compliance, making it an excellent choice for startups and established businesses alike.
Key Benefits Include:
Privacy Protection
Predictable Taxes
No Double Taxation
Legal Environment
Business Credibility
Clear Guidelines
Pros and Cons of an LLC in South Dakota
Starting a South Dakota LLC: Benefits
LLCs enjoy personal liability protection, no state income tax, low filing and maintenance costs, and flexible governance structures.
Taxation of a South Dakota LLC
By default, LLCs are pass-through entities. South Dakota imposes no state income tax, so members only pay federal taxes on profits. Sales and use tax may apply to certain goods or services.
Starting a South Dakota LLC: Drawbacks
An Annual Report must be filed each year. Missing deadlines risks penalties and dissolution. Some businesses may still need local licenses or permits.
Who Can Form an LLC in South Dakota?
Any individual or business entity (including non-residents and foreign LLCs) may form or register to operate an LLC in South Dakota.
Types of LLCs in South Dakota
Domestic LLC (South Dakota-based LLC)
Formed under South Dakota law and operating primarily in-state. Requires Articles of Organization and a registered agent in South Dakota.
Foreign LLC (Out-of-state LLC registering in South Dakota)
An LLC formed elsewhere must register with the South Dakota Secretary of State to do business in the state, including appointing a local registered agent.
Series LLC
South Dakota does not allow Series LLCs under current state law.
Restricted LLC
There is no Restricted LLC classification in South Dakota. Limitations must be set via the Operating Agreement.
Professional LLC (PLLC)
Licensed professionals may form an LLC, but South Dakota does not have a separate PLLC statute. Professional compliance is subject to licensing boards.
How to Start an LLC in South Dakota
Choose a Business Name
Select a unique name that includes "LLC" or "L.L.C." and ensure it’s distinguishable from existing entities in South Dakota. Use the Secretary of State’s name search tool to verify availability.
Appoint a Registered Agent
Designate a registered agent to accept legal documents. This can be an individual or a registered service company with a physical address in South Dakota.
File the Articles of Organization
Submit Form LLC to the South Dakota Secretary of State, providing LLC name, principal office address, and registered agent details.
Create an Operating Agreement
Though not required, it’s recommended to draft an Operating Agreement outlining ownership, governance, and profit distribution to reinforce liability protection and support tax compliance.
South Dakota LLC Requirements
Age and Residency
Number of Members
Management Structure
Registered Agent and Office
Name Compliance
South Dakota LLC Application
To start an LLC in South Dakota, you must file Articles of Organization with the Secretary of State.
Required Information
- LLC name (must include LLC or equivalent).
- Registered agent with a physical South Dakota address.
- Principal business address.
- Management structure (membeor manager-managed).
- Duration (perpetual or limited).
Filing Options
- Online via the South Dakota Secretary of State portal.
- Paper filing available.
Post-Filing Requirements
- File Annual Report each year by the first day of the LLC’s anniversary month.
- Maintain a registered agent in the state.
- Draft an Operating Agreement (not filed with the state).
South Dakota LLC Taxation
Pass-Through taxation
Profits/losses pass directly to members. No state personal or corporate income tax applies.
Sales & Use Tax
LLCs selling taxable goods/services must collect and remit South Dakota’s sales/use tax. Rates vary by locality.
Other Taxes
Payroll and employment taxes apply if the LLC has employees. Industry-specific licenses or fees may also apply.
South Dakota LLC Annual Filing (Annual Report)
What to File
The Annual Report includes LLC name, principal office address, registered agent information, and member/manager details.
Filing Deadlines
Reports are due annually by the first day of the LLC’s anniversary month.
Penalties & Consequences
Failure to file leads to late fees and may cause administrative dissolution, resulting in loss of good standing and liability protections.
Expanding Your South Dakota LLC
Registering a Foreign LLC in South Dakota
An LLC formed outside South Dakota must file a foreign registration application, appoint a registered agent in South Dakota, and comply with state reporting requirements.
Doing Business in Other States
To operate in other states, a South Dakota LLC must foreign-qualify there, file necessary reports, pay local taxes, and keep good standing in both South Dakota and the new jurisdiction.
Find The Right State To
Form An LLC
Every state has different rules, costs, and considerations for LLC formation.
Start Your Business Today
Our Experts are ready to assist!
Doing Business in South Dakota
Frequently Asked Questions
Yes, most states require you to have a registered agent to handle legal documents and notices during business hours.
While not always required by law, having an operating agreement is a smart move to outline your LLC’s rules and avoid disputes down the road.
An EIN is a federal tax ID; most LLCs need one to open a business bank account, file taxes, or hire employees.