ND vs. SD for Tax Burden Comparisons (sales, house)

[Muffinpuncher]

Sure SD has no income tax, but what is the actual difference in total encumbered tax burden ? Looking for more applied input vs. excel spread sheet comparisons.

[601halfdozen0theother]

If you are looking at property taxes, you have to be really clear that there is a huge difference between rural places and cities. In SD, the property taxes in and around Sioux Falls and Rapid City are much higher than the property taxes found in small towns and rural areas in other counties around the state.

The same is true, to a lesser degree, with sales taxes. The general state sales tax rate is currently 4.5%, but "South Dakota municipalities may impose a municipal sales tax, use tax, and gross receipts tax. Municipalities may impose a general municipal sales tax rate of up to 2%. They may also impose a 1% municipal gross receipts tax (MGRT) that is in addition to the municipal sales tax. The municipal gross receipts tax can be imposed on alcoholic beverages, eating establishments, lodging accommodations, admissions to places of amusement, athletic, and cultural events." https://dor.sd.gov Different cities and towns impose different rates onto the state rate.

So the total tax burden of an urban dweller is just going to be higher than the tax burden of a rural resident, and it's important to bear that in mind instead of just thinking of a state as a whole.

[SDbp]

In SD, it depends a lot on where you live and also the school district. I'm in Sioux Falls, and our sales tax is 6.5%. While no income tax was great while I was still working in a STEM field, property tax takes a pretty good bite out of me, about 1.5%. Part of Sioux Falls is in the next county south, and I have heard the property taxes down there are even higher. A person just has to look at the overall tax burden, and what you are ... or aren't ... getting for the taxes you pay.

[jmgg]

Both states can take a bow when compared to other states in the U.S. when it comes to overall tax burden.

South Dakota ranks 44th and North Dakota is 40th for least overall tax burden.

https://wallethub.com/edu/states-wit...x-burden/20494

It should be noted that South Dakota's STATE sales tax rate of 4.5% is being lowered to 4.2%. Most municipalities will normally add 2% to this rate.

North Dakota's sales tax rate is 5%. Municipalities there usually add approx. 2% to this as well.

Also, South Dakota does not tax Social Security Benefits NOR does it have a state income tax. North Dakota does tax both.

Property taxes based on the value of your property are not a bargain in SD, but compared to most of the country. are still lower than average. To make sure that no one on a small fixed income is taxed off of their property, South Dakota has an elderly tax freeze. If your income plus SS benefits is below approx. $ 35,000 a year (I didn't look to update this figure, but it's close) the house you live in and an appurtenant garage with up to 1 acre of land can have the ASSESSMENT frozen to whatever it was when that person turned 65. As assessments go up year after year YOURS stays the same. This has to be applied for every year.

I'm unsure if ND has this assessment freeze.

[SDbp]

I think the 4.2% rate goes into effect in July. I'd much rather have had the repeal of grocery tax. But I heard there is one of those citizen initiatives starting up to get this on the 2024 ballot.

If anyone is interested in prop tax relief for SD seniors, this link should work. I saw the assessment freeze for singles is ~37k.
https://dor.sd.gov/individuals/taxes...operty%20taxes.

[jmgg]

Originally Posted by SDbp

I think the 4.2% rate goes into effect in July. I'd much rather have had the repeal of grocery tax. But I heard there is one of those citizen initiatives starting up to get this on the 2024 ballot.

If anyone is interested in prop tax relief for SD seniors, this link should work. I saw the assessment freeze for singles is ~37k.
https://dor.sd.gov/individuals/taxes...operty%20taxes.

I would have too. The #1 REASON that it went up from 4% to 4.5% during the previous state administration was to increase teacher pay. It immediately changed SD's ranking from 51st to about 45th from the added funding. Well guess what, the excess money going to the schools weren't targeted to teacher pay, but was allocated for each school to raise it as they wish. The schools started using it for other things and we're 51st again. This was a legislative boo boo TRUSTING the schools to use it for teacher salaries. Now, dropping the sales tax by .3%, what do you think will be allocated to teacher pay now?

Gov. Noem was OK with signing the sales tax reduction, but she wanted the grocery tax repeal instead.

[sluggermatt15]

Originally Posted by Muffinpuncher

Sure SD has no income tax, but what is the actual difference in total encumbered tax burden ? Looking for more applied input vs. excel spread sheet comparisons.

Are you moving to one or the other to work? Are you retired? If you have a higher income, probably SD would be more tax friendly.

[2011KTM530]

Property Tax in North Dakota is exploding the last ten years. It’s bad.

[rkcarguy]

Originally Posted by 2011KTM530

Property Tax in North Dakota is exploding the last ten years. It’s bad.

Valuations are up hugely due to west coast exodus
FWIW there wasn't any spread (for me) between ND and SD, ND's income tax + sales tax + property taxes was within $100/year of SD's sales taxes + property taxes.
Both seem overpriced at this point, for a total tax load savings of 2-3% and hellish winters it's not worth it.