1099 Contractor in South Dakota with a Vermont Client: Where Do You File?
Answer
Usually nothing is due anywhere. As a South Dakota resident you file no state return, and Vermont reaches only the part of your self-employment income that comes from work physically done inside Vermont. Keep a record of any days you spend working on Vermont soil.
Last verified
The most common contractor worry — that invoicing an out-of-state client creates a filing obligation there — is usually unfounded. What creates the obligation is physical presence, and South Dakota residents have no home-state return in any case.
Vermont publishes no de minimis day count or dollar floor for nonresidents. Any Vermont-source wage income above the state's general filing threshold requires a nonresident return, and that threshold is reset each year — check the current figure on the Vermont Department of Taxes nonresident instructions before filing.
What you file
- 1Nonresident return · VermontForm IN-111 with Schedule IN-113
File a Vermont nonresident return only for income from services you physically performed in Vermont. South Dakota does not tax wage or self-employment income.
The two states, side by side
| South Dakota | Vermont | |
|---|---|---|
| Taxes wages | No | Yes — graduated |
| Reciprocity partners | None | None |
| Convenience rule | No | No |
| Nonresident return | Not applicable | Form IN-111 with Schedule IN-113 |
| Credit for other-state tax | No income tax | Schedule IN-117 |
| Nonresident safe harbour | Not applicable | None published |
| Local income tax | No | No |
| Revenue department | South Dakota Department of Revenue | Vermont Department of Taxes |
| Last verified |
The other direction
Reversing the commute does not always reverse the answer. Living in Vermont and working in South Dakota gives:Home state only — estimated payments.
Same two states, different situation
The withholding answer turns on how you are paid and where the work happens, not only on which two states are involved.
- W-2 commuter: South Dakota → VermontWork state only
- Remote worker: South Dakota → VermontNo state income tax on your wages
- Moved mid-year: South Dakota → VermontOne part-year return — the state you moved to
Other South Dakota pairs
Questions people actually ask
I live in South Dakota and my client is in Vermont. Do I have to file a Vermont tax return?
Usually nothing is due anywhere. As a South Dakota resident you file no state return, and Vermont reaches only the part of your self-employment income that comes from work physically done inside Vermont. Keep a record of any days you spend working on Vermont soil.
Do reciprocity agreements help a 1099 contractor?
No. Every state reciprocity agreement in the country is an arrangement about wage withholding between two revenue departments, and a 1099 has no withholding to switch off. Whether South Dakota and Vermont hold an agreement makes no difference to a self-employed filer — sourcing rules decide the answer instead.
How current is this?
The South Dakota and Vermont rules on this page were last checked against South Dakota Department of Revenue and Vermont Department of Taxes on 2026-08-07. We re-check the full grid every December after state legislative sessions close, and re-check the convenience-of-the-employer states quarterly because that is where the rules move fastest.
Sources
Every fact above comes from the revenue department that publishes the rule. We do not cite secondary summaries, and we do not restate a figure we could not find at source.
- South Dakota Department of Revenue — individual income taxaccessed 2026-08-07
- Vermont Department of Taxes — individual income taxaccessed 2026-08-07