Updated September 4, 2026. Quick answer: No. South Dakota is one of the states with no individual income tax, so pensions, 401(k)/IRA withdrawals and Social Security all pass through untaxed at the state level.
Federal civil service pensions in South Dakota: does South Dakota tax federal pensions.
Hold a 403(b) or 457(b)? What the state’s own documents say about taxing those withdrawals: does South Dakota tax 403(b) and 457(b) withdrawals.
The state retirement system (SDRS), with its options and refund rules from its own handbooks: South Dakota SDRS retirement decisions.
Married, or planning for a spouse’s death? Whether the state is a community property state, from its own statutes: Is South Dakota a community property state?.
Withdrawing from an IRA or 401(k)? Whether the state withholds tax from it, from its own documents: South Dakota tax withholding on IRA and 401(k) withdrawals.
A pension earned in another state, or paid after a move, is covered here: does South Dakota tax out-of-state pensions.
Taking money out of your TSP? How the state taxes it, from its own tax documents: Does South Dakota tax TSP withdrawals?.
Inheriting from, or planning for, someone in this state? Whether the state has an inheritance tax, from its own tax documents: Does South Dakota have an inheritance tax?.
Trusts have their own page: does South Dakota tax trust income.
Dividends and interest have their own page: does South Dakota tax dividends and interest.
Contributing to an HSA? How the state taxes it, from its own tax documents: Does South Dakota tax HSA contributions?.
Annuity payments have their own page: does South Dakota tax annuity income.
Planning for what you leave behind? The state’s estate tax answer, from its own tax documents: Does South Dakota have an estate tax?.
Military retired pay has its own page: does South Dakota tax military retirement.
Saving for a child’s college? The state’s 529 break has its own page: South Dakota 529 plan tax deduction.
Withdrawals from a 401(k) or IRA have their own page: does South Dakota tax 401(k) and IRA withdrawals.
Selling stocks, funds or real estate has its own page: does South Dakota tax capital gains.
More on South Dakota: How to Dissolve an LLC in South Dakota and How Much Does a Living Trust Cost in South Dakota?
Related state retirement tax guides: Does South Dakota Tax Social Security?
Confidence note: high. This page is scoped to pension, IRA and 401(k) taxation specifically. For the state’s full retirement-tax picture (Social Security, tax rates, estate and probate), see how South Dakota taxes retirement income generally.
How pensions and retirement-account withdrawals are taxed
| Public (state/local government) pensions | Not taxed: there is no state income tax to apply to it. |
|---|---|
| Private (employer) pensions | Not taxed, for the same reason. |
| Federal government pensions (FERS/CSRS) | Not taxed, for the same reason. |
| Military retirement pay | Not taxed, for the same reason. |
| IRA and 401(k)/403(b) distributions | Not taxed, for the same reason. |
| General retirement-income exclusion | Not applicable: there is no income tax to exclude retirement income from. |
Optional next step
Want help with your retirement plan?
Request an adviser match to discuss how this fits your retirement withdrawals.
- No fee to request a match
- No obligation to hire
Expect questions about your situation, your name, email and phone, and phone verification by text. A match is not guaranteed.
The form is run by Kapitalwise, our advisor-matching partner. Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide is paid when you submit the form, whether or not you ever hire anyone. This is free to you and there is no obligation to hire anyone.
Opens here. Nothing loads and nothing reaches Kapitalwise until you press the button.
How our partner relationships workSocial Security
Social Security is not taxed either, for the same reason. Social Security has its own rules in every state; see the full breakdown in how South Dakota taxes retirement income generally.
Figures verified against the South Dakota Department of Revenue Individuals: Taxes page on September 30, 2026.
Statute and sources
Governing citation: S.D. Dept. of Revenue, Individuals/Taxes page.
Read September 4, 2026.
Related: how South Dakota taxes retirement income generally · does South Dakota tax Roth conversions? · Roth conversion taxes, all 51 jurisdictions.
General information drawn from each state’s own published statutes and revenue-department guidance, not legal, tax or financial advice. Figures and exemption amounts are current as of the date in the quick answer, are set by state law, and can change by future legislation; any pending bill named on this page is not yet law. This page cannot see your own return, which governs. We are not a law firm, a tax adviser, or a fiduciary, and this is not personalized advice.
For your own numbers, run the Retirement Tax Comparison Tool (2026): Compare Any Two States.
See Retirement Tax Relocation (2026): The Four Taxes That Change When You Move for the full state by state breakdown.