The Property Tax Division is responsible for overseeing South Dakota's property tax system, including property tax assessments, property tax levies and all property tax laws. Property taxes are the primary source of funding for schools, counties, municipalities and other units of local government. The Property Tax Division plays a critical role in ensuring that property assessments are fair, equitable and in compliance with state law.
How Property Taxes are Calculated
- Establishing the Value of the Property
The first step is to establish the full and true value of all property within the boundaries of each unit of government. State statutes require property to be assessed at its market (or full and true) value. Market value is the amount the property would probably sell for if sold on the open market.
- Determine the Taxable Value of the Property
All property is to be assessed at full and true value. Then the property is equalized to 85% for property tax purposes. If the county is at 100% of full and true value, then the equalization factor (the number to get to 85% of taxable value) would be .85. For example: A home with a full and true value of $230,000 has a taxable value ($230,000 multiplied by .85) of $195,500.
- Determine the Tax Levy for All Taxing Jurisdictions Which can Tax Properties
The third step is to determine the amount of taxes needed to meet the costs of operating a unit of government. The higher the cost of operating the city or school district, the larger the revenues required from property taxes. Revenues from property taxes, combined with other monies such as federal grants, must equal the size of the budget of the unit of government. The amount of property taxes a taxing entity can ask for is limited based on the Property Tax Reduction Act. The tax rate for all property in a local unit of government is arrived at by dividing the value of all the property into the amount of the budget that is unfunded from other sources. This calculation results in a tax rate expressed in dollars of property value, or “dollars per thousand”. For example: if the taxable value within a city is $10,000,000 and the city has a tax levy request of $100,000, the tax levy is $10 per thousand.
- Taxes are Computed for Individual Properties
The final step is to apply the tax rate calculated in step three to individual properties. For example, using a tax levy of $10 per thousand from the example above, the tax on a home with a taxable value of $200,000 would be calculated at $10 X 200 or a tax of $2,000.
Property Owner Appeal Process Guide
As the owner of real property in South Dakota, you have the right to ensure your property is being assessed at no more than market value, as well as assessed equitably in relationship to other properties. Understand the process of appealing your assessed value with the Property Owner Appeal Process Guide (PDF).
Opting Out of Tax Limitations
Taxing Districts (other than School Districts)
“Opting out” means the taxing entity needs more monies from property taxes than they are allowed by the limitation. The limitation allows increases to taxes payable in the preceding year by the consumer price index and growth. The CPI for taxes payable in 2020 has been set at 2.4.
If the school district cannot operate on the revenues generated by the maximum levy for general fund and monies from state aid as determined by the funding formula, then the school district may choose to “opt-out” of the general fund levy limitations. School districts may opt out for General Fund only.
South Dakota Buffer Strip Program
South Dakota agricultural property owners with riparian buffer strips (a vegetated area near a body of water) have until October 15 to apply for a property tax incentive. Eligible waterways are determined by the Department of Environment and Natural Resources with additional waterways as allowed by the county commission. If you have questions about the eligibility of your land, contact your local Director of Equalization. To be eligible applicants must meet the following requirements:
- The land must consist of existing or planted perennial vegetation.
- The buffer strip has to be a minimum of 50 feet wide and can be a maximum of 120 feet wide. The measurement starts at the top of the bank or where the vegetation starts—whichever is closest to the water.
- The vegetation cannot be harvested or mowed before July 10. A minimum of 4 inches of vegetation must be maintained at all times.
- The land may not be grazed from May through September.
Property Tax Relief Programs
A number of relief programs offer financial assistance to the elderly and disabled. Find descriptions of each program and application forms.
Get to know the roles of the people to talk to when you have property tax questions.
Director of Equalization
The county Director of Equalization has the responsibility of ensuring all property in the county is accounted for on the tax list. They are also responsible to ensure these properties are all assessed in an equal and uniform manner.
The Auditor figures the tax levies for all allowable taxing entities within the County and ensures the amount of taxes received complies with state law. In addition, the County Auditor serves as the clerk of the County Commission and records and preserves the records of the Commission proceedings.
When people think of county revenues they often think of property taxes, which account for the majority of revenue in county budgets. The treasurer is responsible for collecting all property taxes for the county, cities, school districts and any other political district authorized to levy real estate taxes.
Register of Deeds
Your county register of deeds office can most appropriately be thought of as a library of local records. This office is a storage facility for a host of local documents. From land title transfers to birth, marriage, and death records, this office has a wealth of information about the local population. Although these are only a few of the documents recorded in this office, they remain some of the most widely requested by the general public.
Property Tax Publications
- 2018 Tax Increment Financing Annual Report (PDF)
- Agricultural Land Productivity Formula (PDF)
- Discretionary Formula (PDF)
- Tax Refund Program for Senior Citizens with Disabilities (PDF)
Property Tax Online Forms
See what others are asking about filing, paying and finding important information on property taxes for individuals.
Owner-occupied property is a property that is lived in by the owner as his / her primary residence. Any individual can only claim one owner-occupied property throughout the state. This status is not available to commercial property owners.
Only the County Board of Equalization has the authority to hear appeals on property classifications. For more information, download the Appeal Process Guide for the Property Owner (PDF).
Download the Assessment Freeze for the Elderly and Disabled form (PDF) or obtain an application form from your local County Treasurers office. Your local County Treasurers office will assist you with any questions you may have about the form. Complete the form and return it to your local County Treasurer on or before April 1 of the current year. For more information, view the Assessment Freeze Brochure (PDF).
Download the application for paraplegic or paraplegic veteran form (PDF) or obtain an application form from your local County Treasurer's office. Your local county treasurers office will assist you with any questions you may have about the form. Complete the form and return it to your local county treasurer on or before April 1 of the current year.