Local taxes in SD (Sioux Falls, Rapid City: sales, real estate, co-op)

[ulsterscot]

I know SD has no state income tax, but I was curious about local taxes. Here in Ohio I have to pay state income tax, city income tax in the city I work in, city income tax in the city I live in, property tax, and school tax.

I used to live in Washington and was shocked at all the local taxes slapped on in Ohio when I first moved here. The final straw was the other day when my fine city decided to start it's own gas co-op and involuntarily enrolled everyone in town. My gas service is still through my old gas company, but I had to pay a extra fee to the city co-op. It took me all day on the phone to get unenrolled, and I still have to pay the first months "co-op service fee".

How is SD? Any cities to avoid tax wise? I am torn between RC, Mitchell, and Aberdeen. So if anyone of them has a heavy handed city government, it would help me to rule them out.

Thanks in advance for any replies.

[DannyBanany]

It's true that we do not pay income tax. Sales tax is on everything we buy and it is at 6% with some exceptions like services and tobacco. Cigarettes have an extra dollar added to each pack, so many people cross state lines for cigarettes.

I am not sure how property taxes are in Sioux Falls, Aberdeen, and Mitchell, but in Rapid City they are quite high. I have a friend that pays $3000 a year on a paid for house. Rapid City tends to take the highest allowed tax increase allowed by the state each year.


I am not exact on all South Dakota taxes, so here is the website for the South Dakota Department of Revenue
South Dakota Department of Revenue & Regulation

[ulsterscot]

Thanks. Ohio also has sales tax, gas tax, tobacco tax, etc etc etc. If you can name it, they have taxed it here.

I included RC ( and surrounding area ) for the scenery, but kind of figured it would be too expensive an area to look at realistically. Some of the houses I looked at online were a million plus, yikes!

Mitchell seems nice, but is right on an interstate hwy, and has lots of growth, so that makes me leery.

Basically, anywhere with city income taxes ( or other excessive taxes ) will be ruled out. I am touring around the state this summer, and kind of want to narrow my search.

[windtimber]

Originally Posted by ulsterscot

...Mitchell seems nice, but is right on an interstate hwy, and has lots of growth, so that makes me leery...

Being on the interstate is, by and large, a positive, not a negative, impact for a community in South Dakota. You need to realize that it's a heck of a long ways to anywhere and the sooner you can get on a 75 mph limited access highway the better. Mitchell has had growth in the last 5 years - pent up housing demand and retail trade on the south side of town. Population demographics have not significantly changed.

I don't have the real estate tax notice for my residence handy, but for my office building the real estate tax levy per $1000 of assessed value is $6.00 for the City, $4.85 for the County, $0.10 for the James River Water District, and $13.81 for the School District. That totals $24.76 per $1000 so for a property assessed at $100,000 the tax bill is $2,476 per year. Assessed value is supposed to be at about 90% of fair market value.

State sales tax is 4%. The City of Mitchell has a 2% additional sales tax. There are very few exemptions to sales tax [advertising, newspapers, medical care, to name a few] so for practical purposes figure you'll pay sales tax on everything.

There are a few other taxes or "fees" as well. Sellers of real estate must pay $0.50 per $500.00 of value as a transfer fee. Some communities, Mitchell included, have an additional 1% "bed & booze" tax on hotel rooms and prepared foods to fund auditoriums, convention centers, community promotion, and so forth.

South Dakota repealed its inheritance tax several years ago. It has no individual or corporate income tax.

[DannyBanany]

I am sorry, I was wrong about state sales tax. It is 4% and an extra 2% in Rapid City.

I am not sure on Aberdeen, Mitchell, and Sioux Falls' taxes. Why are taxes such an important factor in your home search? I would much rather live somewhere that I was happy and pay taxes than be somewhere miserable and have a few cents in my pocket.

Mitchell is growing very nicely and it is on the Interstate which is desirable for living in South Dakota. The further you live from an Interstate, the more hazardous your winter driving becomes. Rapid City is probably the most expensive city to live in in South Dakota, so many people build in Meade County which is about 5 miles northwest of Rapid City. Taxes are very low there. People also build outside of city limits to avoid high property taxes. Rapid City has some massive projects to pay for so I think they leave it up to property taxes.

Don't rule out Sioux Falls either. It is one of the best places to live in the United States and jobs are readily available there. It is one of the fastest growing cities in the US as well, but it looks to be growing nicely.

As for Aberdeen... BRR!!!

[sugarbeet]

Any of the cities you're interested in (I would add Sioux Falls, Brookings and Watertown to your list) will be quite similar to one another. Although South Dakota is rather large in land area, most of the state is similar in terms of quality of life. At least for someone like you coming from another state it will probably seem that way. West River will look different from East River, but I think you'll find a wonderful, welcoming environment wherever you go in SD. You will get a "vibe" which town is right for you.

And as others have said, I don't think you will have to worry about growth being an issue. Maybe in Sioux Falls, but certainly not in Mitchell. Growth is only a good thing in towns of that size!

[ulsterscot]

Thanks for the replies. Taxes are a big issue to me because I like to keep what I earn, as opposed to giving it away to be wasted by big gov't. As the bible says "If a man will not work, he shall not eat" 2 Thes 3:10

Not including the taxes that are fairly nationwide ( sales, property, gas etc ), I pay as much in local taxes as I do in federal taxes. The lovely city income taxes here don't even come with a rebate if they over tax you. My home city over taxed me by $200 last year, and I can't get it back.

I ruled out Sioux Falls because it is too big, and seems to be "the spot" to move to. I see it continuing to grow and get worse and worse as more folks move in from bad areas.

Mitchell made me leery because if SF does go the way of the rest of the nation, Mitchell would be the first jumping off spot for the refugees. I figured Aberdeen might be isolated enough to stay decent for 40 or 50 years until I pass away.

I am coming out in June to see everything in person. Can't wait to visit your beautiful state!

[Chris19]

The license plates/registration ($35-$55) and sales tax (3%) is affordable, compared to other states.

I had to pay 3% of the difference between the selling price of the new car and trade in value of my prior car a year and a half ago when I traded my 04 Pontiac for an 06 Pontiac.

[windtimber]

Originally Posted by ulsterscot

Thanks for the replies. Taxes are a big issue to me because I like to keep what I earn, as opposed to giving it away to be wasted by big gov't.

I'm no big tax fan, but we do have to pay for roads, schools, fire departments, law enforcement, public utility service, etc. Additionally, parks, recreation areas, public lands, museums, city bands, and other public amenities certainly add to quality of life. I don't think you'll find SD taking your tax money to be "wasted by big gov't."

[MJ1986]

Aberdeen is isolated, but it's also seeing small growth...a new beef packing plant is opening, and a few other businesses have located there/increased employment. Its connected to I-29 via a four lane expressway. It's a nice city...out of the way...I grew up near there...I think Aberdeen is what you're looking for