South Dakota Mileage and Vehicle Tax Records (2026): No State Income Tax, TNC Insurance Rules, Local Ordinances and Driverless Vehicles

General information, not tax or legal advice. Talk to your tax preparer or attorney about your situation.

South Dakota doesn't impose a state income tax, so a driver's mileage log mainly supports the federal return: Schedule C, self-employment tax and any vehicle depreciation. State TNC law covers insurance and driver checks, and cities and counties may add rules. Since 2024, fully autonomous vehicles may operate without a human driver if they meet set conditions.

With no state income tax, South Dakota drivers keep mileage records mainly for the IRS. This guide covers what the South Dakota Department of Revenue and the South Dakota Codified Laws say as of October 16, 2026.

The federal baseline every South Dakota driver starts from

Most vehicle deductions begin on your federal return. If you're self-employed, you can generally use the standard mileage rate or actual expenses for the business share of your car (IRS Topic 510). For 2026 the business rate is 72.5¢ per mile for January 1 to June 30 (IR-2025-128 / Notice 2026-10) and 76¢ per mile for July 1 to December 31 (IR-2026-29 / Announcement 2026-11) (IRS standard mileage rates). EVs use the same rates; see the 2026 EV mileage rate guide. Most employees can't deduct unreimbursed car expenses federally (Topic 510). IRS Publication 463 asks for each business trip's miles, date, destination and purpose, plus total miles. Commuting stays personal (commuting vs business miles).

South Dakota taxes and your vehicle

The South Dakota Department of Revenue says South Dakota doesn't impose a state income tax. That means there's no South Dakota return for wages or self-employment earnings. Your mileage log supports your federal return: Schedule C vehicle expenses, self-employment tax and any depreciation on Form 4562. See Form 4562 Part V vehicle records and commuting vs. business miles.

Depreciation and federal records

With no state return, there's no South Dakota depreciation adjustment to track; the federal rules decide your vehicle deduction. Choose between the standard mileage rate and actual costs with your preparer, and keep purchase documents and Form 4562 for any vehicle you depreciate. If you also earn income in another state, that state may tax it. See robotaxi fleet depreciation and Section 179.

Rideshare (TNC) rules in South Dakota

South Dakota's TNC law is SDCL chapter 32-40, enacted in 2016. It covers driver applications, criminal background and driving record checks, a zero-tolerance drug and alcohol policy, insurance while logged on and during rides, and disclosures to drivers. Under SDCL 32-40-23, nothing in the chapter limits further regulation of TNCs by a municipality or county, except on insurance. So check your city's rules too. Save your own trip receipts and annual summaries for your federal Schedule C. See which rideshare miles count. If you also drive in a neighboring state, see the Minnesota and Iowa guides.

Robotaxis and automated motor vehicles in South Dakota

South Dakota's 2024 law (SL 2024, ch. 122) created SDCL chapter 32-41, Automated Motor Vehicles. Under SDCL 32-41-2, a fully autonomous vehicle may operate on public roads without a human driver if its automated driving system is engaged and it can achieve a minimal risk condition, follows traffic laws and carries any required federal certification label. SDCL 32-41-6 allows on-demand autonomous vehicle networks under the TNC chapter. Under SDCL 32-41-11, no state agency or political subdivision may prohibit these vehicles or networks or add taxes, fees or requirements specific to them, apart from local traffic control. For fleet records, see robotaxi fleet tax basics.

What to keep in your South Dakota records

Each business trip's date, start, destination, purpose and miles, plus total miles for the year (Pub 463); a weekly log counts as timely kept.
Separate Business, Commute and Personal totals for Form 4562 Part V.
Keep records until the period of limitations runs out, generally 3 years federally (IRS); ask your preparer about the state period.
Keep your federal mileage log, Schedule C and Form 4562; there's no South Dakota income tax return.
For rideshare: download trip receipts and annual summaries, and check any city rules where you drive.

For the full list of log fields, see what the IRS asks you to record.

Example: 1,000 hypothetical business miles driven in September 2026 × 76¢ (IR-2026-29) = $760 at the federal standard rate. Miles driven in March 2026 would use 72.5¢ (IR-2025-128) instead, so keep each trip's date. Estimates, not tax advice.

One log for your federal return

With no South Dakota individual income tax return, your mileage log serves your federal return; your preparer works from the same business, commuting and personal miles. CyberDeduct builds a mileage log around IRS Pub 463 from your Tesla's own trip and odometer data (Model S, 3, X, Y and Cybertruck). You connect your Tesla account once through Tesla's standard account sign-in (OAuth); CyberDeduct never sees or stores your password. Home/work rules and route templates label most trips Business, Commute or Personal; you tap to change any label and confirm the purpose. The dashboard shows your business-use percentage and warns you on the 28th if you're under 50%. You export a PDF or CSV log plus a Form 4562 Part V worksheet for your preparer. See how the log is built or see plans.

Sources (checked October 16, 2026)

Frequently asked questions

Does South Dakota tax rideshare or self-employment income?

No. The Department of Revenue says South Dakota doesn't impose a state income tax.

Why keep a mileage log in South Dakota?

For your federal Schedule C, self-employment tax and Form 4562, and for any other state where you earn income.

Can South Dakota cities regulate rideshare?

Yes. SDCL 32-40-23 leaves room for municipal or county regulation, except on insurance.

Are driverless cars legal in South Dakota?

Yes. Since 2024, SDCL 32-41-2 lets fully autonomous vehicles operate without a human driver if they meet its conditions.

Can robotaxi networks operate in South Dakota?

SDCL 32-41-6 allows on-demand autonomous vehicle networks to operate under the TNC chapter.

This article is general information, not tax or legal advice. Talk to your tax preparer or attorney about your situation. State laws and bill status change; check the linked sources for the current text.

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