This bill proposes amendments to existing South Dakota tax law, specifically targeting the bank franchise tax. It seeks to repeal certain income modifications related to bad debts, thereby simplifying the tax calculation for financial institutions. The bill amends sections 10-1-47, 10-43-10.2, and 10-43-10.3, which outline the definitions and components of taxable income for banks. The amendments clarify the treatment of various types of income and deductions, including interest, dividends, and capital gains, while also specifying the conditions under which these items are added to or subtracted from taxable income.

Key changes include the removal of specific provisions that previously allowed for the modification of taxable income concerning bad debts. The bill maintains the definitions of taxable income and the treatment of dividends and capital gains but streamlines the process by eliminating the complexities associated with bad debt modifications. Overall, the legislation aims to create a more straightforward tax framework for banks operating in South Dakota, potentially enhancing compliance and reducing administrative burdens.

Statutes affected:
Introduced, 01/01/2026: 10-1-47, 10-43-10.2, 10-43-10.3
Enrolled, 02/05/2026: 10-1-47, 10-43-10.2, 10-43-10.3