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South Dakota sales tax notices

Got a letter from the South Dakota Department of Revenue? Find it below to see what it means, why businesses usually receive it, and what to do next.

Sources checked

Tax authority

South Dakota Department of Revenue (opens in a new tab)

Disagree with a notice?

If you believe a Certificate of Assessment rests on a mistake of fact or an error of law, send the Secretary of Revenue a written request for an administrative hearing. The request must say which part of the assessment you contest and the mistake or error. You cannot request a hearing only on penalty and interest. Corporations, LLCs and other entities must have legal representation at the hearing. The Secretary's order can be appealed to circuit court within 30 days.

Deadline: 60 days from the date of the Certificate of Assessment

Source: South Dakota Department of Revenue (opens in a new tab)

Failure to file

The authority has no return on record for a period it expects one, often because an account is open but filings stopped.

Failure to file

30 day Notice - Remote Sellers (notice of failure to file)

A notice to a remote seller registered under the Streamlined Sales and Use Tax Agreement that a required return was not filed. It comes before the Department sets a sales tax liability based on the missing return.

Why you got it

  • A registered remote seller with no legal requirement to register in South Dakota missed a required return

What to do

  1. Check whether the return for that period was already filed.
  2. File the missing return before the 30-day notice period ends. If you have a history of late filing or not filing, the Department may set the liability sooner, so file right away.
  3. Pay the tax due with the return. If a late-filing penalty is charged and you had reasonable cause, ask the Department to reduce or eliminate it.

Before you pay penalties: check whether you can ask for them to be waived, and what the state needs paid first. How to ask

Response window: At least 30 days' notice before a liability is established

Source: 30 day Notice - Remote Sellers (South Dakota Department of Revenue) (opens in a new tab)

Balance due

A bill for tax, penalty, or interest the authority says is unpaid.

Balance due

Notice of Balance Due or Delinquency Notice

A notice that a return or payment is past due. Late returns carry a 10% penalty (at least $10), and unpaid tax accrues interest of 1% per month.

Why you got it

  • A return was not filed by its due date
  • Tax due was not paid in full

What to do

  1. Check the periods on the notice against your records and respond promptly.
  2. File any missing returns and pay the tax. Contact the Department at 1-800-829-9188 if you cannot pay in full.
  3. If you had reasonable cause for filing late, ask the Department to reduce or eliminate the penalty. The law allows this for reasonable cause.
  4. Do not ignore it. The Department can issue an estimated assessment, file a tax lien, issue a distress warrant, revoke your tax license, refer the debt to a collection agency or file a criminal complaint.

Before you pay penalties: check whether you can ask for them to be waived, and what the state needs paid first. How to ask

Source: Sales and Use Tax Guide (South Dakota Department of Revenue) (opens in a new tab)

Assessment

A proposed or final determination of tax owed, sometimes estimated when returns were never filed.

Assessment

Certificate of Assessment

The formal assessment of tax, penalty and interest after an audit, sent by certified mail. It is due on the date it is issued.

Why you got it

  • An audit found underreported sales, use or contractor's excise tax
  • The Department decided that you owe tax, penalty or interest

What to do

  1. Check the assessment against your records and the auditor's findings.
  2. If it rests on a mistake of fact or an error of law, send the Secretary of Revenue a written hearing request within 60 days. You cannot request a hearing only on penalty and interest.
  3. Otherwise, pay online through the Department's audit payment page or make arrangements to pay within 60 days. If you do neither and don't request a hearing, collection starts (liens, a jeopardy assessment, a distress warrant or license revocation).
  4. If a late-filing penalty is included and you had reasonable cause, ask the Department to reduce or eliminate it. Tax, interest and penalty can also be reduced if there was a genuine misunderstanding of how the tax applied and you had tried in good faith to check with the Department.

Before you pay penalties: check whether you can ask for them to be waived, and what the state needs paid first. How to ask

Response window: 60 days from the date of the Certificate of Assessment

Source: Audits (Tax Fact, December 2025) - South Dakota Department of Revenue (opens in a new tab)

Audit

A request for records or notice that the authority is examining your returns.

Audit

Notice of Intent to Audit

A notice confirming that your business will be audited. It lists the return periods under review and the date the audit starts.

Why you got it

  • Selection by automated systems or manual review, based on business type, earlier audits and filing history
  • Reported sales, use or excise tax that differs significantly from what the Department expects
  • Random selection to confirm compliance

What to do

  1. Gather all records for the return periods listed on the notice before the audit starts.
  2. Give documents supporting exemptions or deductions to the auditor within 60 days of the audit start date. Later documents may not be considered.
  3. If you need more time, ask for an extension before the 60 days run out. For good cause, an extra 30 days may be granted through an Agreement to Produce Records.
  4. Contact your auditor or their supervisor with questions.

Response window: Records must be provided within 60 days of the audit commencement date; the notice arrives at least 30 days before the audit begins

Source: Audit | South Dakota Department of Revenue (opens in a new tab)

Collections

Enforcement on unpaid balances, such as liens, levies, warrants, or referral to a collection agency.

Collections

Tax lien, distress warrant or tax license revocation

Enforcement actions the Department can take on unresolved delinquencies. It can file a tax lien with the register of deeds, issue a distress warrant telling the sheriff to seize property, or revoke your sales tax license.

Why you got it

  • Returns or payments stayed delinquent after a revenue agent tried to resolve them
  • An assessment was not paid, arranged or appealed within 60 days

What to do

  1. Contact the Department right away to pay in full or arrange payment.
  2. Stop making sales if your license is revoked. Doing business after revocation is a Class 6 felony.
  3. After paying all tax, penalty and interest, expect the lien to be removed within 30 days, which is your right under the Taxpayer Bill of Rights.

Before you pay penalties: check whether you can ask for them to be waived, and what the state needs paid first. How to ask

Source: Sales and Use Tax Guide (South Dakota Department of Revenue) (opens in a new tab)

Ask for penalty relief

Penalties on a South Dakota notice aren't always final. You can ask for them to be waived. Follow the steps below, including anything the state requires you to file or pay before it reviews the request.

Penalty reduction or elimination for reasonable cause

  1. File the missing return and pay the tax due, or contact the Department at 1-800-829-9188 to arrange payment
  2. Ask the Department of Revenue to reduce or eliminate the late-filing penalty, explaining the reasonable cause and including supporting documents
  3. If the problem was a genuine misunderstanding of how the tax applied, show that you contacted the Department in good faith to find out, and ask for the tax, interest and penalty to be reduced

What qualifies: Reasonable cause for the late-filing penalty (SDCL 10-59-6). Separately, a bona fide misunderstanding of how the tax applies plus a good-faith effort to check with the Department (SDCL 10-59-31).

Interest: The late-filing penalty rule does not provide for waiving interest. Interest can be reduced or abated only under SDCL 10-59-31 (bona fide misunderstanding and good-faith contact with the Department). If a late payment was caused by a mistake of law, the Secretary can cap interest at 24% on application.

Source: SDCL 10-59-6 – Penalty for failure to file return – Penalty reduced or eliminated (South Dakota Legislature) (opens in a new tab)

Before you respond

  • Check the date on the notice. Response windows usually run from that date, not the day you open it.
  • Match the account number and filing period to your own records before paying or disputing.
  • If returns are missing, filing the actual returns usually replaces an estimated bill. Confirm how on the notice or with the authority.
  • Ask about penalty relief before paying penalties, and check what must be paid with the request. See how
  • Keep a copy of the notice and everything you send back.

This page is general information, not tax or legal advice. Notice names and procedures change, so always follow the instructions on your notice and the official sources linked above.

Need the rates, nexus thresholds and filing rules? Read the South Dakota sales tax guide.

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