The South Dakota sublease agreement is a legal contract that allows a tenant to rent out all or a portion of the property to a subtenant in exchange for regular payments.
Does a Tenant Need the Landlord’s Permission to Sublet in South Dakota?
A tenant in South Dakota does need to receive a landlord’s explicit written consent to sublet. Even after consent is given, a landlord still has the right to reject a subtenant if they are unqualified, such as for having filed for bankruptcy or low credit score.
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Standardized South Dakota Sublease Agreements
A standard form can be used in South Dakota to create a sublease. Here’s what is generally included in a South Dakota sublease agreement:
- The Names of the Parties – The original tenant under the lease is named in the sublease and is called the “Sublessor.” The third party that is subleasing the rental unit is named in the sublease and is called the “Sublessee.”
- Term – The exact date of the sublease beginning and ending date.
- Rent – How much the rent is, when it needs to be paid, and how to pay it.
- Rental Unit Location – The address for the rental unit as described in the master lease.
- Master Lease Inclusion – A copy of the Master Lease is attached to the sublease. If any exceptions in the Master Lease are not included they should be clearly stated in this section.
- General Conditions – A statement that the written sublease agreement contains all of the agreements between the parties and can only be modified by written consent of the parties to the agreement.
- Disputes – A description of how disputes between the Sublessor and Sublessee are to be settled, which may include mediation and binding arbitration to avoid more expensive legal proceedings.
- Liability – The sublessee will be liable for any damages to the Sublessor. The Sublessor is responsible for paying for any damages that impact the landlord as stated in the master lease agreement.
- Authorized Occupants – This identifies the new tenant(s) and those authorized to live in the rental unit including any policy about short-term guests.
- Lead-Based Paint Notice – Under Federal law, if the rental unit’s premises were built before 1978, the Sublessee must be given a written warning notice, called a Lead-Based Paint Disclosure.
- Security Deposit – The security deposit is held by the Sublessor (not the landlord). South Dakota law limits the maximum security deposit to one month’s rent. However, a landlord can exceed the limit with the tenant’s consent if special conditions pose a risk to the property.
- Pet Deposit – Landlords can collect an additional pet deposit in South Dakota, except for service dogs and emotional support animals.
- Return of Security Deposit – South Dakota landlords have 14 days after the lease term ends and the tenant provides a forwarding address or delivery instructions to return any unused portion of the security deposit.
- Inventory of Included Items – The list of items in the rental unit that are part of the sublease which may include appliances or furniture.
- Utilities – The utilities to be paid by the Sublessee and those that are to be paid by the Sublessor.
- Parking Policy – A description of where the subtenant and any guests can park on the property, including any fees.
- Smoking Policy – If smoking is restricted in the rental unit and any designated smoking areas are identified in the sublease.
- Landlord’s Consent – This section describes how the landlord is asked to give permission (if permission is not already included in the Master Lease). Tenants may create a signed sublease that is conditional on being accepted by the landlord before the sublease becomes effective.
- Signature: The signature and date for the Sublessor, the Sublessee, any Co-Sublessors, and Co-Sublessees (if they exist).
Tax Implications of a Sublease
In South Dakota, a sublessor may be subject to state and local taxes if they sublet a property for 28 days or less. For example, in Sioux Falls, taxes may include:
- South Dakota State Sales Tax – 4.5%
- Municipal Sales Tax – 2%
- Municipal Gross Receipts Tax – 1%
- Tourism Tax – 1.5%
