What hourly rate does a South Dakota freelancer need in 2026?
Hourly rate needed in South Dakota by take-home pay
30 billable hours a week, 4 weeks off, $500 a month of business expenses, no health insurance or retirement savings, tax year 2026.
| Take-home pay | Single | Married filing jointly | Tax share (single) |
|---|---|---|---|
| $50,000 | $48/hr | $47/hr | 18.4% |
| $75,000 | $71/hr | $69/hr | 20.8% |
| $100,000 | $96/hr | $92/hr | 23.3% |
| $150,000 | $147/hr | $138/hr | 25.8% |
| $200,000 | $200/hr | $182/hr | 28.3% |
South Dakota income tax for freelancers in 2026
South Dakota has no personal income tax on wages or self-employment income in 2026.
South Dakota does not levy a personal income tax on wages or self-employment income. Freelancers there pay federal income tax and the 15.3% self-employment tax only.
How the calculator handles South Dakota
- South Dakota has no personal income tax, so self-employment income is subject only to federal income and self-employment tax.
- South Dakota's 4.2% state sales tax (plus any municipal sales tax) applies to sales of services unless a specific exemption applies, so many freelancers must collect and remit sales tax; this is a pass-through tax on customers and is not modeled.
Local income taxes in South Dakota
South Dakota cities and counties do not levy a local income tax.
South Dakota estimated tax payments
- Who must pay: Not required. Not applicable: no state personal income tax.
- Safe harbor: Not applicable.
- Form: None
Federal estimated payments follow their own schedule. Work them out with the quarterly estimated tax calculator.
Business costs for a South Dakota freelancer
| LLC formation fee | $150 Articles of Organization filed online ($165 on paper) with the South Dakota Secretary of State. |
|---|---|
| Annual report | $55 annual report filed online ($70 on paper), due every year; $55 late fee if delinquent. |
| Franchise or minimum tax | None. South Dakota has no corporate, unitary or personal income tax and no franchise tax on LLCs. |
| Gross receipts tax | None for a typical freelancer. (Contractor's excise tax of 2% applies only to construction services; municipal gross receipts tax applies only to alcohol, eating establishments, lodging and admissions.) |
You don’t need an LLC to freelance as a sole proprietor. Compare the tax treatment in LLC vs sole proprietor for freelancers.
What else a South Dakota freelancer deals with
Sales tax applies to most services
The South Dakota Department of Revenue says sales tax applies to the sale of services as well as goods. The state rate is 4.2%, and municipal sales tax of 1% to 2% applies where the buyer receives or uses the service in a taxing municipality. The July 2026 Sales and Use Tax Guide lists exempt service categories. They include health, educational, social, agricultural and forestry services, trucking, travel agent services, and construction services covered by the contractor's excise tax. (source 1, source 2)
Professional services are taxable
Department tax facts state that accounting services are subject to state sales tax plus municipal tax. Attorney services are taxable after allowable expenses are deducted. Architect, engineering and surveying receipts are taxable unless the project is entirely outside South Dakota. Services are taxed where the client receives them, generally where the report or result is received. For a client who does not receive the service at the provider's office, the tax rate follows the client's address. (source 1, source 2, source 3)
Sales tax license and remote thresholds
The Department says any business with a physical presence in South Dakota must be licensed for sales tax collection. A business without a physical presence must get a license and pay sales tax if its gross sales into South Dakota exceeded $100,000 in the previous or current calendar year. A remote seller must register by the first day of the month that starts at least thirty days after reaching the threshold. (source 1, source 2)
Creative and web-related services
Department tax facts say internet access and web hosting have not been subject to sales tax since July 1, 2020. Advertising fees are not taxable when the agency that prepares an ad also places it in the media. An ad handed to the client instead is taxable. Photography sitting fees and photos are taxable, with photos taxed where delivered, including electronic delivery. (source 1, source 2, source 3)
LLC formation and annual report fees
The Secretary of State's fee schedule lists $150 online or $165 on paper for domestic LLC Articles of Organization. The annual report costs $55 online or $70 on paper. The annual report instructions direct filers to the online search tool to find their due date. They add a $15 paper processing fee and a late fee for delinquent entities. (source 1, source 2)
Frequently asked questions
Does South Dakota have a state income tax on freelance income?
No. South Dakota does not tax wage or self-employment income, so freelancers there pay federal income tax and self-employment tax only. Business taxes can still apply: None for a typical freelancer. (Contractor's excise tax of 2% applies only to construction services; municipal gross receipts tax applies only to alcohol, eating establishments, lodging and admissions.)
Do freelancers in South Dakota pay state estimated taxes?
No. South Dakota does not require state income tax estimated payments. Not applicable: no state personal income tax.
Sources for South Dakota figures
Verified October 22, 2026 against official South Dakota and IRS publications.
- Sales and Use Tax Guide, July 2026 - South Dakota Department of Revenue
- Business Tax - South Dakota Department of Revenue
- Filing Fees - South Dakota Secretary of State
- Sales & Use Tax - South Dakota Department of Revenue
- Tax Facts: Accountants - South Dakota Department of Revenue
- Tax Facts: Attorneys - South Dakota Department of Revenue
- Tax Facts: Architects, Engineers, and Surveyors - South Dakota Department of Revenue
- Tax Facts: Internet - South Dakota Department of Revenue
- Tax Facts: Advertising Agencies - South Dakota Department of Revenue
- Tax Facts: Photographers - South Dakota Department of Revenue
- Annual Report Instructions - South Dakota Secretary of State
Estimates for educational and planning purposes only. HourFloor does not provide tax, legal or financial advice. Verify your numbers with a qualified tax professional.