Please note: this article is about the Justworks Payroll product. Not sure which product you're using? Check out: How Do I Know Which Justworks Product I Have?
Paying employees in South Dakota
When hiring employees in new states, you will need to register for relevant state tax accounts to facilitate their payment. In South Dakota, you must be registered with the South Dakota Department of Labor UI Division (unemployment tax). Please note that SD does not have income tax on wages and salaries.
Alternatively, Justworks Payroll can handle the registration process for you. We offer state tax registration services to assist with registering your business in new states. To request registration, please contact us at support@payroll.justworks.com.
South Dakota Accounts Registration and Rate Info
Registering for an Unemployment Tax Account with the Department of Labor and Regulation:
Register online with the South Dakota Department of Labor's UI Division. After completing your registration, you’ll receive:
- Employer Account Number (unemployment account number)
- Reemployment Assistance (RA) Tax Rate (unemployment rate), which includes:
- RA Tax
- Investment Fee
- Administrative Fee (if applicable based on liability)
Please keep in mind that in South Dakota, most businesses are required to pay unemployment insurance tax if they meet one of the following criteria:
- Paid $1,500 in wages within a calendar quarter, or
- Had at least one employee in South Dakota working part of a week for 20 or more different weeks in a calendar year.
If you do not meet the minimum requirements, you will need to apply once you’ve met either of the requirements mentioned above.
Already Registered? Locate This Information
Locate Your Unemployment Tax Account and Tax Rate:
If you’ve previously run payroll in South Dakota, you can locate your unemployment account number and tax rate by:
- Reviewing notices from the South Dakota Department of Labor, such as the "Contribution and Investment Fee Rate Notice" or the "Employer’s Unemployment Insurance (UI) Quarterly Report" (Form 21).
- Contacting the agency at (605) 626-2312.
Entering State Tax Info in Justworks Payroll
Once you registered with the State and have a valid SD address added to your company’s offices, you can add your account info in Justworks Payroll by navigating to:
- Company > Settings in the left navigation bar
- Under ‘Company tax info’ click into “South Dakota” to edit the state tax information
In your Justworks Payroll account, you’ll want to enter your Employer Account Number and Reemployment Assistance (RA) Tax Rate (unemployment rate) and Investment Fee.
Third-party admin access
As your payroll provider, Justworks Payroll will utilize the provided account information to manage and report your SD tax liabilities. Occasionally, the state may issue notices related to payroll taxes.
Justworks Payroll can examine these notices if granted Third-party admin access to your SD state tax account. During onboarding, we will request that you sign state specific TPA forms, which authorizes us to handle and report your taxes to the state.
Why is this important?
Justworks Payroll calculates tax liabilities as part of payroll processing. If we cannot access your SD state tax accounts, we must return any unremitted tax liabilities to your company bank account, requiring you to remit and file your company’s state taxes manually.
Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.