How to Form an LLC in South Dakota

Thinking about starting a business in South Dakota? Forming a Limited Liability Company (LLC) is one of the smartest ways to protect your personal assets and create a strong legal foundation for your venture. An LLC offers flexibility, limited liability protection, and a straightforward path to compliance — making it ideal for entrepreneurs and small business owners across the state.

In this guide, we’ll walk you through every step of the LLC formation process in South Dakota — from choosing a name and filing your Articles of Organization to staying compliant after you’re up and running.

Step 1: Choose a Business Name

Your business name is your brand’s foundation — but it must meet South Dakota’s naming rules.

To comply, your name must:

• Include “Limited Liability Company,” “LLC,” or “L.L.C.”

• Be distinguishable from other registered entities in the state

• Avoid misleading terms or words implying government affiliation (like “FBI” or “Treasury”)

You can check name availability through the South Dakota Secretary of State’s business name database. If the name you want is available but you’re not ready to register yet, consider reserving it for a limited time for a small fee.

Step 2: Appoint a Registered Agent

Every South Dakota LLC must designate a registered agent — an individual or company with a physical address in South Dakota (no PO boxes allowed).

The registered agent’s role is crucial: they receive legal notices, tax documents, and other official correspondence on behalf of your business.

You can act as your own registered agent if you meet the state requirements, or you may appoint another qualified person or service to handle this responsibility.

Step 3: File the Articles of Organization

To officially create your LLC, you’ll need to file Articles of Organization with the South Dakota Secretary of State.

Filing options and fees:

• Online filing: $150 (typically processed within 3–5 business days)

• Mail filing: $165 (processing may take longer)

The Articles of Organization must include:

• The official LLC name

• Principal business address

• Registered agent’s name and address

• Names and addresses of LLC members or managers

• The LLC’s duration (if not perpetual)

• The management structure (member-managed or manager-managed)

• The organizer’s signature

Once approved, you’ll receive a Certificate of Organization, which officially confirms your LLC’s existence.

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Step 4: Create an Operating Agreement

While South Dakota doesn’t legally require LLCs to have an Operating Agreement, drafting one is highly recommended.

This internal document outlines:

• Each member’s ownership percentage

• Voting rights and management duties

• Profit distribution methods

• Steps for handling disputes, new members, or dissolution

An Operating Agreement also helps preserve your limited liability protection, showing that your business operates as a separate legal entity — not just a personal venture.

Step 5: Obtain an Employer Identification Number (EIN)

After forming your LLC, you’ll need to apply for a free Employer Identification Number (EIN) from the Internal Revenue Service (IRS).

Your EIN is essential for:

• Filing federal and state taxes

• Opening a business bank account

• Hiring employees and processing payroll

It functions like a Social Security Number for your business, identifying it for all tax-related purposes.

Step 6: Maintain Company Records

Keeping proper business records is key to compliance and smooth operations.

Your LLC should maintain:

• Copies of the Articles of Organization and amendments

• The Operating Agreement

• Annual meeting minutes (if applicable)

• Financial statements, invoices, and tax filings

Proper documentation not only simplifies tax preparation but also strengthens your LLC’s legal standing in case of audits or disputes.

Step 7: Stay Compliant with Ongoing Requirements

South Dakota has relatively straightforward compliance rules, but missing any can result in penalties or administrative dissolution.

Key requirements include:

• Annual Report: Due each year by the first day of your LLC’s anniversary month.

• Filing fee: $50 if filed online, $65 if by mail.

• Licenses and Permits: Depending on your business type and location, you may need additional state or local permits.

Keeping up with these filings ensures your LLC remains active and in good standing.

How Accounting Services Can Help

Managing an LLC involves more than just filing paperwork — it’s about keeping your business financially healthy and compliant.

That’s where Counto can help.
As experts in accounting services in the US, Counto helps US small businesses manage their books, payroll, and taxes efficiently. From setting up your accounting system to tracking expenses and ensuring timely tax filings, Counto’s blend of automation and expert accountants keeps your finances clear and compliant — so you can focus on growing your business.

Whether you’re launching your first South Dakota LLC or scaling your existing one, Counto provides the financial clarity you need to thrive.

Summary

Forming an LLC in South Dakota is a smart way to protect your personal assets while building a strong business foundation. By choosing a compliant name, appointing a registered agent, filing your Articles of Organization, and maintaining proper records, you set your business up for success.

Your Books, Automated. Your Questions, Answered.

Manual bookkeeping eats into time you could spend growing your business. Traditional accounting services charge more but still need constant guidance. There’s a better way.

Counto’s modern accounting solution combines AI that learns your business with expert human oversight. Once our system understands your patterns, it handles daily bookkeeping automatically. Professional accountants review everything for accuracy, and you get instant access to your dedicated Customer Success Manager via SMS or phone—no more waiting for answers about your finances.

Join forward-thinking businesses who’ve upgraded to intelligent accounting that adapts to you, not the other way around. Ready for accounting that actually gets your business? Chat with us now, email [email protected], or use our contact form.

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