How do I register as a household employer in South Dakota?

Start with a federal EIN, then register with South Dakota for each account that applies to you. Apply for a federal EIN at IRS.gov. It is free and takes about 15 minutes. Register with South Dakota's unemployment insurance agency once you cross $1,000 in any calendar quarter. Most states want this within 20 days of becoming a covered employer.

What payroll taxes does South Dakota charge for a household employee?

Federal FICA and FUTA, South Dakota SUTA, and anything else below that applies to you. Federal FICA: 7.65% employer share, matched by your nanny. Federal FUTA: 6.0% on the first $7,000, an effective 0.6% after the state SUTA credit. South Dakota SUTA: 0% - 9.5% plus South Dakota's separate investment & administrative fees on a state-specific wage base, with a separate rate for new employers. No state income tax, because South Dakota does not tax wages.

What are South Dakota's minimum wage and overtime rules for nannies?

At least $11.85 an hour for a nanny in South Dakota. That is South Dakota's own minimum wage. The state exempts babysitters, which may not include a full-time nanny, so pay at least this rate. Some cities and counties may set a higher floor, so check your locality before you set a rate. Overtime is 1.5x pay for hours over 40 in a week, under the FLSA. Live-in nannies are exempt from FLSA overtime, but not from minimum wage. Source: SDCL 60-11-3.

Can I require my nanny to use direct deposit in South Dakota?

Yes. South Dakota allows direct deposit for household employees. Federal Regulation E still applies: your nanny must be free to choose their own bank, or you offer another payment method. Get a written, signed authorization before the first deposit, even though South Dakota does not strictly require one.

What records do I need to keep for a South Dakota household employee?

Keep them for at least 4 years after the return reporting the tax was due, or the tax was paid, whichever is later. Timesheets, pay stubs, W-2 copies, payment confirmations and SUTA filings. South Dakota follows the federal baseline, so 4 years covers both. Most household-employer audits open with the IRS or a state agency asking for exactly these records, so keep them with your tax filings. Source: IRS Publication 926.

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South Dakota Nanny Tax Guide

South Dakota has no state income tax, making it one of the simplest states for household employers. You only need to manage federal taxes and state unemployment insurance.

South Dakota household employer quick facts

Applies in South Dakota

State unemployment

Not in South Dakota

State income tax withholding
Disability insurance
Paid family leave

Minimum Wage

$11.85/hour

The state exempts babysitters, which may not include a full-time nanny.

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SUTA Rate Range

0% - 9.5%

New employers: 1.2% on the first $15,000 (2026). South Dakota Department of Labor and Regulation

Key things to know

No state income tax
South Dakota's minimum wage is $11.85/hour. The state exempts babysitters, which may not include a full-time nanny.
No disability or paid leave requirements
One of the simplest states for compliance

South Dakota Employer Requirements

No State Income Tax

South Dakota has no state income tax. You only need to handle federal income tax withholding if your employee requests it on their W-4.

State Unemployment Insurance

Employers pay SUI tax on the first $15,000 of wages. New employer rate is 1.2%, with rates ranging from 0.0% to 9.5% based on experience. South Dakota also charges a 0.55% investment fee and a 0.08% administrative fee on the same wages. Both are yours to pay and neither can be withheld from your nanny.

Workers' Compensation

South Dakota doesn't require workers' compensation from any employer, so it's optional for your nanny too. It's still worth considering: if your employee is hurt at work and you have no coverage, they can sue you in civil court for damages.

South Dakota household employer questions

What will it cost?

Wondering what you'll actually owe as a South Dakota employer? Adjust the numbers below to get a quick estimate of your annual tax obligations.

This guide is for informational purposes only and should not be considered legal or tax advice. Tax laws change frequently. Always verify current requirements with your state's tax agency or consult with a qualified tax professional.

Verified accurate as of June 2026Sources: South Dakota tax agency, IRS Publication 926

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South Dakota Nanny Tax Guide

South Dakota household employer quick facts

South Dakota Employer Requirements

No State Income Tax

State Unemployment Insurance

Workers' Compensation

South Dakota household employer questions

What will it cost?

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