Travis Bunn
Founder, AppealDesk · Published March 1, 2026
How Much Can Property Taxes Increase in South Dakota? 2026 Complete Guide
Updated July 2026
Quick Answer
South Dakota limits property tax growth in two separate ways, and neither one is a limit on your individual bill. Under SDCL 10-13-35, a taxing district's property tax revenue may grow by no more than the lesser of 3% or the CPI index factor over the prior year, plus growth from new construction. Separately, SB 216 (signed March 13, 2025) caps growth in the countywide aggregate assessed value of owner-occupied single-family dwellings at 3% per year for tax years 2027 through 2031. That second cap applies to the county total, not to your parcel, so your own assessment can still rise faster than 3% in a given year. Properties are reassessed annually, and the assessed value itself is the number worth checking.
Most homeowners never challenge their assessment, usually because nobody tells them they can or shows them how. That gap is the whole reason AppealDesk exists: see what your county has your home on record at, free, and if the number looks wrong we build the case for $49.
How South Dakota Limits Property Tax Increases
For most of its history South Dakota took a different route from cap states like California. Rather than freeze what a home is assessed at, it limited what local governments could collect. Under SDCL 10-13-35, each taxing district's total property tax revenue may increase by no more than the lesser of 3% or the index factor (a CPI-based figure set annually by the State Economist), measured against taxes payable in the preceding year, plus an allowance for growth such as new construction. Notice the word lesser. In a low-inflation year the ceiling lands well under 3%, not at 3%.
Here is what that looks like in practice. If a school district collected $10 million last year and the index factor comes in at 2.1%, the district may collect at most $10,210,000 this year from existing property, plus whatever new construction adds to the base. The limit constrains the size of the pool, not how the pool is divided. Your bill is your share of that pool, and your share is set by your assessed value relative to everyone else's. If your value rises faster than your neighbors' values, your bill can climb by more than 3% while the district stays comfortably inside its limit. That is the single most misunderstood feature of the South Dakota system.
The New 3% Cap: What SB 216 Actually Does
In March 2025 South Dakota added something it had never had: a cap on assessment growth. SB 216, signed into law on March 13, 2025 by Governor Larry Rhoden, caps growth in the countywide aggregate assessed value of owner-occupied single-family dwellings at 3% per year for tax years 2027 through 2031. It also caps taxing district and school capital outlay budget increases attributable to new construction at 3%.
The load-bearing word is aggregate. This is not a Proposition 13-style parcel cap. The 3% ceiling applies to the combined assessed value of all owner-occupied homes in a county, and inside that total individual assessments move at very different speeds. Imagine a county where owner-occupied values collectively rise the full 3% allowed. Homes in a flat rural township might be reassessed at roughly last year's value while homes in a fast-appreciating subdivision are reassessed 8% or 10% higher. Both outcomes are consistent with the cap. On a $300,000 home, an 8% increase is $24,000 of new assessed value, and the levies apply to every dollar of it. The cap changes the arithmetic county officials must do in aggregate. It does not promise anything about your number.
SB 216 also expanded the state's assessment freeze program for eligible homeowners. Income limits rose to $55,000 for a single-member household and $65,000 for a multi-member household, and the maximum eligible home value rose to $500,000 of full-and-true value. If you are on a fixed income and near those thresholds, the application is worth making. Your county director of equalization administers it and can confirm the current paperwork.
What Changed in 2026: SB 245 and SB 96
The 2026 session added two more measures aimed squarely at owner-occupied homes. SB 245 creates a homeowner property tax reduction fund that buys down school general education levies on owner-occupied single-family dwellings. It is funded by a transfer of $55,896,576 on July 1, 2026 and by a state sales tax increase from 4.2% to 4.5% effective July 1, 2027, with the additional 0.3% dedicated to the buydown. Projections cited during the session put owner-occupied reductions in the range of roughly 14% to 22% on the affected portion of the bill.
SB 96 works from the county level. It allows a county to adopt an additional 0.5% county sales tax dedicated exclusively to reducing owner-occupied residential property taxes, with 100% of the proceeds going to owner-occupied relief before any funds reach other property classes. Adoption is county by county, and those debates were still underway across the state as of spring 2026. Whether you benefit depends on what your county commission decides.
Read together, these laws shift part of the school funding burden off owner-occupied property taxes and onto sales taxes. The relief arrives as a lower levy, which means it lowers the rate applied to your assessed value. It does nothing to verify that the assessed value is correct in the first place. A percentage discount on an inflated number is still an inflated bill.
Caps and rate limits only control how fast your bill can grow. Nothing in them checks whether the number underneath is right. Assessors in South Dakota set values with mass-appraisal models that price thousands of homes at once, and nobody reviews yours unless you challenge it.
See what South Dakota has your home on record at
The number your tax bill is figured from, pulled free in seconds. No account needed.
What Is South Dakota's Property Tax Rate in 2026?
There is no single statewide property tax rate in South Dakota. Your bill is the product of your assessed value and the combined mill levies of every district that taxes your parcel: county, school district, municipality, and any special districts. Because those levies differ from one district to the next, two identically valued homes in different towns can owe meaningfully different amounts. Classification matters too. Owner-occupied single-family homes are taxed at a lower school general fund levy than agricultural or commercial property, and the SB 245 buydown lowers that levy further as its funding phases in.
The most reliable way to find your own effective rate is to divide last year's total tax by your assessed value, which gives you the real percentage you paid rather than a statewide average that may not describe your district at all. For the forward-looking number, ask your county treasurer for the current mill levies applied to your parcel. Minnehaha County, the state's largest and home to Sioux Falls, publishes levy sheets by taxing district each year, and most other counties do the same. Treat any single quoted South Dakota average with caution, because the spread between districts is wide enough to make the average misleading in either direction.
Are Property Taxes High in South Dakota?
Property taxes carry unusual weight here, and the reason is structural. South Dakota has no state income tax, so schools and local governments lean on property taxes and sales taxes to fund almost everything. That reliance is precisely why the legislature spent 2025 and 2026 passing relief. SB 216's aggregate assessment cap, SB 245's state-funded levy buydown, and SB 96's county-option sales tax all exist because owner-occupied bills had been climbing alongside the housing market faster than lawmakers were willing to defend. Whether your own bill is high, though, still resolves to two local variables: the levies in your districts and the assessed value on your notice. The first is out of your hands. The second is not.
Does South Dakota Have Property Tax?
Yes. The question comes up constantly because the state has no income tax, but property tax is very much in force and is the primary funding source for schools and local government. Every parcel is assessed annually at market value by the county director of equalization, and the resulting taxes are billed and collected by the county treasurer. There is no state property tax levy. The tax is local, which is exactly why rates and bills vary so much from one county and school district to the next.
Do Property Taxes Go Up Every Year in South Dakota?
They can, because South Dakota reassesses every property every year. An annual cycle means your assessed value tracks the market closely, so in an appreciating market you should expect the number on your notice to move most years rather than sit still for a decade the way it might in a state with a long reassessment cycle. The levy limit in SDCL 10-13-35 holds district revenue growth to the lesser of 3% or the index factor, and from tax year 2027 the SB 216 cap slows countywide owner-occupied assessment growth, but neither mechanism stops your individual assessment from jumping in a given year. When your value rises faster than the county average, your share of the levy rises with it. The annual cycle cuts both ways, though: it also hands you a fresh chance to appeal every single year.
When Are Property Taxes Due in South Dakota?
South Dakota property taxes are billed and paid in the year following the assessment year, and the county treasurer collects them, typically in installments across the year. Exact due dates, discount rules, and delinquency dates are administered at the county level, so confirm the current calendar with your county treasurer's office rather than relying on a statewide summary. For controlling what you owe, the payment date is the less important deadline anyway. The appeal window closes months earlier, and once it passes the value is fixed for that year.
What you can do about it
How to Challenge Your Assessment: The 2026 Appeal Window
South Dakota uses a two-step board process, and the sequence is not optional. Your written appeal to the local board of equalization must reach the local board clerk no later than the Thursday preceding the third Monday in March. If a local board applies to your property and you skip it, you forfeit your right to appeal to the boards that follow, so start local. The next step is the county board of equalization, and that appeal must be filed with the county auditor on or before the first Tuesday in April. Where no local board applies to your property, the county board is your first stop. Appeal rights exist beyond the county board at the state and court level; confirm the exact venue and deadline with your county auditor if your case goes that far.
These deadlines land early in the year, well before any tax is due, and they are firm. The homeowners who win reductions are the ones who arrive with evidence rather than an opinion: recent sales of genuinely comparable homes, documentation of condition problems the model could not see, and a clear argument that the assessed value overshoots what the property would actually sell for. Because South Dakota reassesses annually, an appeal you miss this March comes around again next March. The overpayment in between does not come back.
A real AppealDesk order, Hennepin County, Minnesota
In April 2026, a homeowner in Hennepin County, Minnesota ran the check. The county had their home on record at $441,600, while recorded sales of comparable homes supported about $356,693: an over-assessment of $84,907, worth roughly $943 per year if corrected. Their packet laid out the comparable sales, the forms, and the filing steps. Nobody at the county was ever going to run that check for them.
Growth limits only help if the number they grow from is fair. If your assessment jumped after a purchase, new construction, or a revaluation, that new number is the one nobody has reviewed. Checking it is free and takes about a minute.
Check the number your bill is figured from
Enter your address to pull your county record free. If it looks too high, your $49 packet gives you everything to challenge it.
Frequently Asked Questions
How much can my South Dakota property taxes increase per year?
There is no fixed limit on an individual bill. District revenue growth is capped at the lesser of 3% or the CPI index factor under SDCL 10-13-35, and for tax years 2027 through 2031 the countywide aggregate assessed value of owner-occupied homes may grow no more than 3% per year under SB 216. Both caps operate on totals. If your assessment rises faster than the countywide average, your bill can increase by well more than 3% with every cap technically satisfied.
Does South Dakota now have an assessment cap like California's Prop 13?
No. SB 216's 3% cap applies to the countywide aggregate of owner-occupied assessed value for tax years 2027 through 2031, not to individual parcels. Under Prop 13, a specific home's assessment cannot grow more than 2% a year. Under SB 216, the county total is constrained while your parcel is not, so an individual assessment can still jump sharply in a strong local market.
How often is my property reassessed in South Dakota?
Annually. Every parcel receives a fresh assessed value each year, which is why South Dakota values track the market more closely than in states with multi-year cycles. It also means a new appeal opportunity opens every year, with the local board deadline falling on the Thursday preceding the third Monday in March and the county board deadline on the first Tuesday in April.
Who qualifies for South Dakota's assessment freeze?
After the SB 216 expansion, the income limits are $55,000 for a single-member household and $65,000 for a multi-member household, and the home's full-and-true value may be up to $500,000. Applications go through the county, and your director of equalization can confirm the current requirements, forms, and filing dates before you rely on them.
Will the new laws actually lower my tax bill?
If you own and occupy a single-family home, likely yes on the school portion. SB 245's buydown of school general education levies is funded starting July 1, 2026, with session projections of roughly 14% to 22% reductions for owner-occupied homes, and SB 96 adds more relief in counties that adopt the optional 0.5% sales tax. None of it corrects an inflated assessment. A value that is too high quietly consumes the relief, which is why confirming the assessed value is still step one.
Related Resources
If your assessment looks high, start with our guide on how to appeal property taxes in South Dakota, which walks the local and county board process step by step. If you are weighing whether the effort pays off, see is it worth appealing property taxes for the math, then read what evidence you need for an appeal for what boards actually want to see.
This article provides general information about South Dakota property tax laws as of July 2026. Tax laws change frequently, and local rules vary. Consult your county assessor or a tax professional for advice specific to your situation.