Start a South Dakota LLC

The first step to forming an LLC in South Dakota is choosing a unique name. This is the perfect time to get creative, as your name reflects your brand, culture, and ideal customers. However, the name you choose must meet the state’s legal requirements for naming an LLC. If it doesn’t meet the requirements, the Secretary of State may reject your registration, and you’ll have to file again.

Official Naming Requirements for an LLC in South Dakota

 South Dakota requires LLC names to:

• Be distinguishable from other business names on the record in South Dakota
• Contain an identifying suffix, like “limited liability company,” “limited company,” “L.L.C.,” “LLC,” “L.C.,” or “LC.” You may abbreviate limited as Ltd. or company as Co.

Once you have some ideas, perform a business name search to see if your name is available in the state. We have detailed instructions to guide you through this search on our South Dakota business name search page. If your name is unique and available, you can reserve the name immediately.

Reserve your business name  

When you find your chosen name is available, you can reserve it for 120 days. A reservation gives you time to prepare your formation documents without worrying about another business using your name. To reserve your name, submit an Application For Reservation of Name with the Secretary of State’s office. You’ll pay a small filing fee when you file this application.

Our business experts can file this form for you when you use our Business Name Reservation Service. The service includes a name check, where we make sure your intended name is available based on the state’s standards.

Find a domain name

Having a website is an important tool for reaching potential and current customers. Whether a domain name is available might influence your name choice. The URL you choose will represent your business on your website, email address, and web hosting as you grow your online presence. When you find a domain name you want, use our Domain Name Registration Service to secure and reserve the URL.

Register a DBA

If you plan to do business under a name other than the LLC’s legal, registered name, you’ll register a DBA (“doing business as”) name. DBAs can be helpful if you want to abbreviate your name or differentiate a new product line or service. The South Dakota Secretary of State registers DBA names for a small filing fee and requires renewal every 5 years. We can complete this filing for you with our DBA Service.

Register for trademark protection

When you come up with a creative name, logo, or slogan, you can register your trademark for protection. The South Dakota Secretary of State manages trademark registration at the state level. Trademark registration requires a filing fee and a sample showing the use of the mark in commerce. Examples of trademarks include tabs or labels, invoices, brochures, catalogs, letterhead, or business cards. 

Remember that trademarks are also registered on the federal level. Before committing to a name, complete a search with the U.S. Patent and Trademark Office website. A search will let you see if another business has already trademarked the name.

Appoint a registered agent for your LLC. When you appoint a registered agent, that person acts as a contact person for the LLC. They receive legal notices, including service of process, subpoenas, and other information from the Secretary of State. The registered agent then delivers the notice to the appropriate person at the LLC, usually an owner. 

The agent must be available at a physical address (called a “registered office”) within South Dakota during business hours to receive notices in person. The registered office doesn’t have to be the same as the business’s principal address. 

Who can be a registered agent in South Dakota?

You may appoint any person with a physical address in South Dakota as the registered agent for your LLC. South Dakota maintains a list of Commercial Registered Agents in the state. If you use a commercial registered agent, you only need to list the agent’s name and their CRA# on your formation documents. To appoint another person who isn’t registered as a commercial agent, you need to include their name and address. You may also designate an agent by position or office (such as CEO or Secretary) if you include the business office address.

When you choose a registered agent, talk to them and obtain their consent. The consent doesn’t need to be in writing. However, by appointing a registered agent, you legally affirm that you’ve received their consent to serve as your agent.

Can I be my own registered agent?

Yes, you can serve as the registered agent for your LLC. However, this isn’t always the best idea. The registered agent must be available at the listed address during all business hours to receive notices. If you’re the registered agent, you risk being served notice of a lawsuit in front of customers or business partners. And worse, you might miss notices if you call out sick or take a vacation, and legal proceedings could move forward without you.

Use a registered agent service

Using a registered agent keeps you in legal compliance and lets you receive notices no matter where you are. You won’t need to worry about keeping your address updated if you move, and you can rest easy knowing you’ll always be informed. To help, we provide a Registered Agent Service that connects you with a commercial registered agent in South Dakota. In addition to forwarding your notices, we also save a copy in your business dashboard to help you stay organized.

File your Articles of Organization with the South Dakota Secretary of State. When the Secretary of State accepts your Articles of Organization, they will issue a Certificate of Organization. The Certificate of Organization serves as proof that your LLC is properly formed under the laws of South Dakota. You’ll keep the Certificate and Articles of Organization at the business’s principal office.

What is required in the LLC Articles of Organization?

Filing is one of the most important steps in how to set up an LLC in South Dakota. It informs the Secretary of State and the public of the company’s name and its owners. When filing your Articles of Organization for an LLC, South Dakota requires that you include:

• The company name
• The initial business office address
• Information appointing your registered agent
• Each organizer’s name and address
• The duration of the company (if other than perpetual)
• The initial manager’s name and address if the LLC is manager-managed.

If you plan to form a series LLC, you’ll include authorization to form a series in your Articles of Organization.

How to file your Articles of Organization

To help you through the process, we offer Business Formation Services that will have your LLC up and running quickly. In addition to filing your Articles of Organization, our services include expert support and a name search to check that your name is available. You’ll get access to our experts online or by phone, where we provide answers to all your filing questions. 

While our Formation Services help guide you through the process, we’ll explain the steps if you choose to file with the Secretary of State on your own.

File your Articles of Organization with South Dakota’s business online services

When you’re ready to file your Articles of Organization, the Secretary of State provides an online form to register your business. As a business owner, you can complete the registration yourself or have an organizer complete the form on your behalf. There is a $150 filing fee for online filing. On our South Dakota filing fees page, you can find the total cost to start an LLC in South Dakota.

Expedited Services

The good news is that the Secretary of State immediately processes South Dakota LLC formation documents that are submitted online. If you’ve signed up for our Business Formation Services, we offer a faster filing speeds service to skip the line.

What if I need to make changes?

Once you file your Articles of Organization and receive your Certificate of Organization, your LLC is officially formed. However, if you change the information in your Articles of Organization, you’ll file the South Dakota Articles of Amendment. Typical changes include appointing a new registered agent or changing to a manager-managed LLC. 

If you do need to file an amendment, we have an Amendment Filing Service that can handle it for you. Plus, our Worry-Free Compliance Service includes two amendment filings every year, compliance reminders, and a professional, organized document dashboard.

Draft an operating agreement that sets rules for how the business will be organized and operated. The operating agreement (OA) is an internal document and isn’t filed with the Secretary of State. The OA defines terms for the LLC’s ownership and management, like:

• Ownership percentages
• How profits are distributed among members
• What happens when a member leaves or wants to sell their stake in the company 

Without an OA, you’ll have to follow South Dakota’s default LLC rules to resolve disputes. But the default rules may not reflect your wishes for your LLC. Having an OA lets you customize your experience.

Register for an Employer Identification Number (EIN) from the Internal Revenue Service (IRS). Sometimes called a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number, the EIN identifies your LLC when paying federal taxes, remitting employee wage withholdings, and applying for a business bank account. You can apply for your EIN online with the IRS, or you can let us handle your application with our EIN service.

Register for South Dakota business taxes

If your business engages in a taxable activity, you must register with the South Dakota Department of Revenue (SD DOR). Any business with a physical presence in South Dakota must obtain a sales tax collection license. There is no threshold sales requirement before you must obtain a license. You can register for most tax licenses on SD DOR’s Filing and Tax Payment portal. Finally, South Dakota doesn’t have a corporate income or general privilege tax.

Additionally, all South Dakota businesses must register with the Reemployment Assistance Tax Unit of the State Department of Labor. Your business will pay reemployment assistance (RA) tax if you meet certain employment criteria. The RA tax rate depends on the years you’ve been in business and the current usage of RA funds.

For Employers

South Dakota doesn’t require employers to have workers’ compensation insurance coverage. However, it’s strongly recommended. An injured employee can file a civil suit against an employer who doesn’t have this insurance. A business owner may choose to enroll in the South Dakota Workers’ Compensation program to receive coverage for work-related injuries and illnesses.

Every business must register with the South Dakota Department of Revenue if engaging in a taxable activity, including sales. Further, new businesses must register with the South Dakota Department of Labor Reemployment Assistance Tax Unit regardless of whether or not they’ll have to pay RA taxes. In addition to state licenses, you may need to register for licenses at the federal or municipal level. Our Business License Report can help you find all the licenses you need to operate legally.

The fee for filing your Articles of Organization in South Dakota is $150, but this doesn’t include other fees like name reservation. The fees change over time, so it’s important to check with the South Dakota Secretary of State to determine the current fee when you’re ready to file.

The LLC is a popular business structure for entrepreneurs because it combines personal liability protection with flexibility and tax advantages. Business owners can avoid corporate formalities while taking advantage of the LLC’s flexible management and ownership options.

The LLC doesn’t pay income taxes to the state or federal government at the entity level. Instead, LLCs use “pass-through” taxation. Owners pay taxes on their personal profits from the business, avoiding the “double taxation” on corporate income. The business might need to pay other taxes, depending on your business activities and if you have employees.

The South Dakota Secretary of State processes online filings immediately.

No, LLC operating agreements are internal company documents. You don’t need to file your OA with the Secretary of State or any other agency.

By default, the LLC uses “pass-through” taxation, where the owners pay income taxes on their share of profits from the business. One benefit of the LLC is the flexibility to choose C Corp or S Corp taxation, which could change how your income is taxed.

Yes, South Dakota Codified Laws Section 47-34A-701 allows series LLCs to have separate profits and losses associated with specified property or obligations.

An event specified in the OA, consent of the members, or judicial decree can trigger LLC dissolution. Once the LLC is dissolved, it must wind up the business and file Articles of Termination to terminate the business.

The LLC operating agreement will spell out the process for transferring ownership. Usually, this involves completing a purchase agreement to document the sale and updating the OA to reflect the change. You’ll also need to file an amendment to update the state on the new ownership.

An LLC that uses a name other than its registered name (or the members’ surnames) must register a DBA with the Secretary of State.

Review your operating agreement for the process to terminate membership in your LLC, including any voting or cause-related criteria. The OA also governs how the removed member’s share will be allocated among the remaining members or offered for sale to third parties. 

You’ll also need to change your LLC’s Articles of Organization by filing your South Dakota Articles of Amendment with the Secretary of State. Finally, update your LLC operating agreement to reflect the new ownership structure.

Yes, every LLC registered in South Dakota must file an annual report with the Secretary of State. If you’re more than 60 days late filing your annual report, your business faces possible administrative dissolution. We offer an Annual Report Service so you’ll never miss a deadline or pay a late fee.

Although it’s not a legal requirement, it’s a good idea to have a business plan. Drafting a business plan allows you to prepare for unexpected events like an economic recession. Further, if you’re just starting out, potential investors and partners may want to see your business plan.

Some states require newly registered LLCs to publish their registration in a local newspaper. South Dakota has no publication requirement.