Overview of South Dakota Taxes
South Dakota is one of seven states that does not have a personal income tax. The sales tax is among the lowest in the country. The average effective property tax in South Dakota is above the national average.
Number of Personal Exemptions
Your Income Taxes Breakdown
|Tax Type||Marginal |
|2018 Trump Taxes*|
|Total Income Taxes|
|Income After Taxes|
* These will be the taxes owed for the 2018 - 2019 filing season.
Under the Trump Tax Plan (2018-2019 filing season), your Federal Income Tax will be and your FICA will be .
Changes to Your Federal Income
Taxes Under the Trump Tax Plan
- Your marginal federal income tax rate will
- Your effective federal income tax rate will
- Your federal income taxes will
Total Estimated Tax Burden
Total Estimated Tax Burden $
Percent of income to taxes = %
- Our Tax Expert
Jennifer Mansfield, CPA Tax
Jennifer Mansfield, CPA, JD/LLM-Tax, is a Certified Public Accountant with more than 30 years of experience providing tax advice. SmartAsset’s tax expert has a degree in Accounting and Business/Management from the University of Wyoming, as well as both a Masters in Tax Laws and a Juris Doctorate from Georgetown University Law Center. Jennifer has mostly worked in public accounting firms, including Ernst & Young and Deloitte. She is passionate about helping provide people and businesses with valuable accounting and tax advice to allow them to prosper financially. Jennifer lives in Arizona and was recently named to the Greater Tucson Leadership Program.
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South Dakota state tax quick facts
When considering all types of taxes, South Dakota is one of the most taxpayer-friendly states in the U.S. It is one of seven states without a personal income tax and its sales taxes are among the lowest in the country. Sales tax rates range from 4% to 6% when including local rates. The combined average is 5.83%, 12th-lowest nationally. In fact, the only major tax in South Dakota that stands above the national average is the state’s property tax. In South Dakota the average effective property tax rate is 1.36% while the national average is 1.1%.
South Dakota Sales Tax
South Dakota’s state sales tax rate is 4.5%. In addition, cities in South Dakota (but not counties) have the option of collecting a local sales tax of 1% or 2%. Most major cities collect the full rate. The table below shows the state and city rates for the largest cities in South Dakota.
Sales Tax Rates (Updated January 2018)
|City||State Rate||City Rate||Total Sales Tax|
|North Sioux City||4.5%||2.0%||6.5%|
Sales tax in the Mount Rushmore State applies to all retail sales, leases or rentals of tangible personal property, electronically downloaded products and services. Unless an item or service is specifically exempt, the sales tax applies.
South Dakota has sales tax exemptions on a number of items. Exempt services include travel agencies, banking services performed by registered institutions, social services, agricultural services, educational services and medical services. Exempt products include prescription drugs, lottery tickets, purchases made with food stamps and water purchased in bulk or through a water supply system. All food sales are taxed in South Dakota (excluding those made with food stamps).
South Dakota Income Tax
If you hate paying taxes, you might want to consider relocating to South Dakota. There is no state income tax in South Dakota. This means income from wages, salaries, capital gains, interest and dividends are not taxed by the state. Furthermore, taxpayers in South Dakota do not need to file a state tax return.
South Dakota Property Tax
Property taxes in South Dakota are the principal source of revenue to support local services like schools, law enforcement, libraries and parks. Property taxes are administered at the local level, but the state oversees property assessments to ensure fairness and compliance with state law. The state’s average effective tax rate is 1.32%, the 16th-highest rate in the country. That varies significantly between counties, from a high of 2.17% in Bennett County to a low of 0.85% in Faulk County.
If you are considering buying a home or thinking about refinancing in the Mount Rushmore State, have a look at our South Dakota mortgage guide. It includes the most relevant information you’ll want to be familiar with before getting a mortgage.
South Dakota Gas Tax
The state gas tax in South Dakota is 30 cents per gallon on regular gasoline. When combined with the federal tax of 18.4 cents, the total gas tax in the state is 48.4 cents per gallon. Diesel fuel faces the same state tax of 30 cents per gallon and a total state and federal tax of 54.4 cents per gallon.
South Dakota Cigarette Tax
Cigarettes in South Dakota are taxed at a rate of $1.53 per pack of 20, slightly lower than the national median of $1.68. Someone who smokes a pack a day would therefore pay more than $550 in cigarette taxes annually in South Dakota.
South Dakota Alcohol Tax
Along with the sales tax rates described above, some cities in the state levy an additional 1% tax on alcohol sales (bringing the total rate to 7%). Alcohol in South Dakota is also subject to excise taxes. Excise taxes, which are charged to the wholesaler and therefore included in the price, vary by beverage type. The tax on liquor is $4.63 per gallon. The tax on wine is $1.27 per gallon. The tax on beer is 27 cents per gallon.
South Dakota Inheritance Tax
South Dakota’s inheritance tax was repealed in the year 2000. The state no longer has an inheritance tax. Likewise, there is no estate tax in South Dakota.
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Places with the Lowest Tax Burden
Are you curious how your tax burden stacks up against others in your state? SmartAsset’s interactive map highlights the counties with the lowest tax burden. Scroll over any county in the state to learn about taxes in that specific area.
Where you live can have a big impact on both which types of taxes you have to pay each year and how much money you spend on them. SmartAsset calculated the amount of money a specific person would pay in income, sales, property and fuel taxes in each county in the country and ranked the lowest to highest tax burden.
To better compare income tax burdens across counties, we used the national median household income. We then applied relevant deductions and exemptions before calculating federal, state and local income taxes.
In order to determine sales tax burden we estimated that 35% of take-home (after-tax) pay is spent on taxable goods. We multiplied the average sales tax rate for a county by the household income less income tax. This product is then multiplied by 35% to estimate the sales tax paid.
For property taxes, we compared the median property taxes paid in each county.
For fuel taxes, we first distributed statewide vehicle miles traveled down to the county level using the number of vehicles in each county. We then calculated the total number of licensed drivers within each county. The countywide miles were then distributed amongst the licensed drivers in the county, which gave us the miles driven per licensed driver. Using the nationwide average fuel economy, we calculated the average gallons of gas used per driver in each county and multiplied that by the fuel tax.
We then added the dollar amount for income, sales, property and fuel taxes to rank the counties to calculate a total tax burden.