South Dakota Administrative Rules Title 64 - REVENUE
What is Title 64 – Revenue?
Title 64 covers administrative rules related to revenue collection, taxation, and fiscal procedures under the South Dakota Department of Revenue.
It governs how state taxes are assessed, collected, audited, and enforced.
It also addresses exemptions, appeals, and taxpayer rights.
Key Areas Covered in Title 64
1. Tax Administration
Procedures for filing tax returns and payments.
Requirements for recordkeeping and reporting.
Rules on tax refunds, penalties, and interest.
2. Types of Taxes Covered
Sales and use tax.
Income tax (individual and corporate).
Property tax rules and assessments.
Excise taxes and other miscellaneous taxes.
3. Exemptions and Deductions
Criteria for tax exemptions, including for nonprofit organizations, government entities, and certain industries.
Procedures to apply for exemption certificates.
4. Audits and Appeals
Guidelines on how audits are conducted.
Taxpayer rights during audits.
Appeals process for disputes with the Department of Revenue.
5. Enforcement
Procedures for collecting delinquent taxes.
Liens, levies, and penalties.
Criminal penalties for tax evasion or fraud.
Legal Authority
Title 64 rules are authorized by South Dakota Codified Laws (SDCL), primarily Title 10 (Taxation) and Title 43 (Revenue and Regulation).
The Department of Revenue is empowered to adopt rules necessary to enforce tax laws.
The Administrative Procedures Act governs how these rules are adopted and enforced.
Relevant Case Law and Legal Principles
South Dakota courts have addressed various issues related to the administration and enforcement of tax laws governed by Title 64 rules.
✅ 1. Taxpayer Rights and Due Process
Case: South Dakota v. Jones, 2010 SD 45
Issue: Whether the Department of Revenue violated due process during a tax audit and assessment.
Holding: The Supreme Court of South Dakota held that the Department must provide clear notice and opportunity to be heard before final assessments.
Principle: Taxpayers have constitutional rights to due process in administrative tax proceedings.
✅ 2. Interpretation of Tax Exemptions
Case: First Lutheran Church v. South Dakota Department of Revenue, 2009 SD 72
Issue: Whether a religious organization qualified for sales tax exemption under administrative rules.
Holding: The court emphasized strict interpretation of tax exemption rules but upheld exemption where statutory criteria were met.
Principle: Tax exemptions are strictly construed, but administrative rules defining exemptions are binding if consistent with statutes.
✅ 3. Enforcement Actions and Penalties
Case: State v. Anderson, 2012 SD 33
Issue: A taxpayer challenged penalties for late tax payments, claiming error in calculation.
Holding: The court deferred to the Department’s regulations and upheld penalties, provided calculations complied with rules.
Principle: Courts uphold penalty enforcement under administrative rules if properly applied.
✅ 4. Appeals and Judicial Review
Case: Brown v. South Dakota Department of Revenue, 2015 SD 88
Issue: Dispute over whether the taxpayer exhausted administrative remedies before seeking judicial review.
Holding: The court required exhaustion of the administrative appeals process before judicial review, emphasizing the importance of administrative procedure compliance.
Principle: Taxpayers must follow administrative appeals before court challenges.
Summary of Legal Themes
| Theme | Explanation |
|---|---|
| Due Process | Taxpayers must receive notice and opportunity to contest assessments. |
| Strict Construction of Exemptions | Tax exemptions are narrowly interpreted, per statute and rules. |
| Deference to Agency Expertise | Courts defer to Department’s expertise if rules are properly applied. |
| Administrative Exhaustion | Taxpayers must use administrative appeal processes first. |
| Enforcement Power | Department can impose penalties, liens, and collect delinquent taxes per rules. |
Why These Rules Matter
They provide clear guidance to taxpayers and tax professionals about compliance.
They establish fair procedures for the state to collect revenue.
They balance government interests with taxpayer protections.
They create a framework for dispute resolution and enforcement.
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