Veterans of Foreign Wars: Conferences - Departments - States > For Veterans: VFW South Dakota

Tax Burden for South Dakota Retirees:

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DoggyDaddy:
Many people planning to retire use the presence or absence of a state income tax as a litmus test for a retirement destination. This is a serious miscalculation since higher sales and property taxes can more than offset the lack of a state income tax. The lack of a state income tax doesn’t necessarily ensure a low total tax burden. Following are the taxes you can expect to pay if you retire in South Dakota:

Sales Taxes
State Sales Tax: 4% (prescription drugs exempt); municipalities may add up to an additional 2.75%. Residents who are age 65 and older and have a yearly income of under $9,750 (single) or in a household where the total income was under $12,750 are eligible for a sales tax refund. Gasoline Tax: :* 24 cents/gallon
Diesel Fuel Tax: * 24 cents/gallon Cigarette Tax: $1.53 cents/pack of 20 * Tax rates to do not include local option tax of 1 cent.

Personal Income Taxes
No state personal income tax Retirement Income: Not taxed.

Property Taxes
Property is assessed at 85% of market value between counties. Assessors determine the market value of property by using a combination of the following three approaches:
(1) Cost approach whereby the assessor estimates the cost of replacing the property (structures), reduces that amount by its age (depreciation) and adds the value of the land.
(2) Market approach whereby the assessor compares the subject property to like properties that have recently been sold.
(3) Income approach in whereby the assessor uses the value of the projected income from a property to determine its value. For more information refer to http://www.state.sd.us/drr2/propspectax/property/home.htm
Property taxes are assessed and collected by local government entities. A tax freeze and/or municipal property tax reduction is available for seniors age 65 and older, and disabled persons. Single homeowners 66 and older who earn $10,000 or less can get a refund of up to 35% of taxes paid. Multi-person households headed by someone 66 and older, where the combined income is $13,000 or less, are eligible for a refund of up to 55% of taxes paid.   
The state has several other property tax relief programs. For details refer to http://www.state.sd.us/drr2/propspectax/property/relief.htm#Sales%20and%20Property%20Tax%20Refund%20for %20Senior%20&%20Disabled%20Citizens
There is a property tax exemption for disabled veterans. Veterans that have been rated as permanently and totally disabled as the result of a service connected disability may be eligible for up to $100,000 of their property value to be exempt from property taxes. Refer to www.state.sd.us/drr2/propspectax/property/disabledveteransforweb.pdf.
The state has a property tax homestead exemption that delays payment of property taxes until the property is sold. Taxes are a lien on the property and must be paid along with interest before the property can be transferred. For more information on all property taxes, www.state.sd.us/drr2/propspectax/property/publications.htm or call 800- 829-9188.
Inheritance and Estate Taxes - There is no inheritance tax and the estate tax is limited and related to federal estate tax collection.

For further information, visit the South Dakota Department of Revenue site www.state.sd.us/drr2/revenue.html or call 800-829-9188.

[Source: www.retirementliving.com Nov 2010 ++] jQuery(document).ready(function($){jQuery(function(){jQuery("#msg_22174").css("min-height", "50px");jQuery("#msg_22174").hoverIntent(function(){jQuery("#msg_22174").css("overflow-y", "hidden");jQuery(".sharethis_22174").delay(100).fadeIn();},function(){jQuery(".sharethis_22174").delay(300).fadeOut();});});});Tweet

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