South Dakota IFTA Fuel Tax Reporting Guide

The International Fuel Tax Agreement (IFTA) is a cooperative program that simplifies the reporting of fuel use taxes by interstate motor carriers. In South Dakota, the Department of Revenue (DOR) administers IFTA licenses and tax returns. Carriers must apply for a South Dakota IFTA license if the state is the base jurisdiction for their operations, meaning the qualified motor vehicles are registered in the state, have an established place of business there, and the operational records are maintained or can be made available in South Dakota. A qualified motor vehicle is defined as one used, designed, or maintained for the transportation of persons or property and has two axles and a gross vehicle weight exceeding 26,000 pounds, or has three or more axles regardless of weight. Filing accurate reports requires tracking every mile driven in each jurisdiction and every gallon of fuel purchased. DispatchTool simplifies this process by automatically logging jurisdictional mileage and consolidating fuel purchase data directly from driver entries or telematics. This allows South Dakota carriers to generate IFTA-ready reports that minimize manual calculation errors and ensure compliance with Department of Revenue audits. Motor carriers can create a DispatchTool account to begin organizing their trip data for the next quarterly deadline.

South Dakota IFTA Licensing and Fees

To obtain an IFTA license in South Dakota, carriers must submit an application through the Department of Revenue’s online portal. Unlike some states that charge an annual fee for the license itself, South Dakota provides the license and the first set of two decals free of charge. However, if a carrier requires additional sets of decals for more vehicles, the cost is $0.50 per set. Decals must be renewed annually and are valid from January 1 through December 31. There is a two-month grace period through February for displaying the new year's decals, provided the carrier has submitted their renewal application by the December 31 deadline.

Quarterly Filing Deadlines and Penalties

South Dakota requires IFTA tax returns to be filed on a quarterly basis. The deadlines are April 30 for Q1 (January–March), July 31 for Q2 (April–June), October 31 for Q3 (July–September), and January 31 for Q4 (October–December). If the filing date falls on a weekend or a legal holiday, the deadline is extended to the next business day. Failure to file by the deadline results in a penalty of $50.00 or 10% of the total tax liability due, whichever is greater. Furthermore, interest is charged on all late payments at a rate of 1% per month or fraction of a month, consistent with IFTA Articles of Agreement.

Record Keeping and Audit Requirements

Per the South Dakota Department of Revenue, carriers must maintain detailed records to support their IFTA filings for a minimum of four years from the filing date. These records must include Individual Vehicle Mileage Records (IVMR) showing the date of the trip, origin and destination, routes of travel, beginning and ending odometer readings, and total distance traveled in each jurisdiction. Fuel records must include original receipts or invoices showing the date of purchase, seller's name and address, number of gallons purchased, and the vehicle unit number. Failure to maintain these records can result in the assessment of taxes based on an assumed 4.0 miles per gallon (MPG) for all miles traveled, which often leads to significantly higher tax liabilities.

South Dakota Fuel Tax Rates for 2024

The current state fuel tax rate in South Dakota is $0.28 per gallon for both gasoline and diesel fuel. When filing IFTA, South Dakota carriers must calculate the difference between the tax paid at the pump and the tax owed to each jurisdiction based on the distance traveled there. For example, if a driver travels through a state with a higher tax rate than $0.28 and did not purchase enough fuel there to cover the mileage, the carrier will owe the difference. Conversely, if fuel was purchased in a high-tax state but consumed in a lower-tax state, the carrier may be eligible for a credit. These calculations must be performed for all 48 contiguous U.S. states and Canadian provinces through which the vehicle traveled.

Non-IFTA Permits in South Dakota

Carriers that do not have an IFTA license but need to travel through South Dakota with a qualified motor vehicle must obtain a temporary fuel permit. This permit costs $20.00 and is valid for a period of 72 hours. This is an alternative for carriers that only occasionally leave their home jurisdiction or for those whose home jurisdiction is not a member of IFTA. These permits must be obtained before entering the state and can be purchased through various permitting services or directly at South Dakota ports of entry. Operating without a valid IFTA license or a temporary permit can result in citations and fines exceeding $100 per occurrence.

Exemptions and Non-Taxable Miles

South Dakota recognizes certain exemptions for fuel tax reporting. Miles driven on private property or by vehicles owned by government agencies (federal, state, or local) are generally exempt from IFTA reporting in South Dakota. However, it is important to note that not all IFTA jurisdictions recognize the same exemptions. For instance, while South Dakota might not tax miles driven on a farm, if that vehicle crosses into a state that does not have a farm exemption, those miles must be reported and taxed according to that jurisdiction's laws. Carriers must keep clear documentation of all exempt miles to prevent them from being included in the total taxable distance during an audit.

Sources

South Dakota Department of Revenue (2024) — https://dor.sd.gov/businesses/taxes/motor-fuel/ifta/ IFTA, Inc. Official Website (2024) — https://www.iftach.org/ South Dakota Codified Law 10-47B (2024) — https://sdlegislature.gov/Statutes/Codified_Laws/2043682

Frequently asked

What is the penalty for late filing in South Dakota?

The penalty for late filing is either $50.00 or 10% of the tax due, whichever amount is greater, plus interest of 1% per month.

How much do IFTA decals cost in South Dakota?

The first set of decals is provided free of charge, and additional sets for additional vehicles cost $0.50 each.

How long must I keep my IFTA fuel receipts?

South Dakota requires you to keep all fuel receipts and mileage records for a period of 4 years.

Can I file my South Dakota IFTA return by mail?

South Dakota strongly encourages electronic filing through the E-Path system, though paper forms can be requested from the Department of Revenue if necessary.

What is a qualified motor vehicle for IFTA in South Dakota?

A vehicle is qualified if it has two axles and a GVW over 26,000 lbs, or has three or more axles regardless of weight.