An Ethanol Producer is any person who engages in the business of producing ethyl alcohol
for sale, use, or distribution. Ethyl alcohol is a motor fuel typically derived from
agricultural products that has been denatured.
All Ethanol Producers that sell, use, or distribute ethyl alcohol in South Dakota must be
licensed. They are required to collect taxes and TI Fees for ethyl alcohol that they sell
unless the ethyl alcohol is sold to a licensed Ethanol Broker or to a licensed Exporter for
Ethanol blend is defined as a blended motor fuel containing ethyl alcohol of at least ninety-
nine percent purity, typically derived from agricultural products which are blended
exclusively with a product commonly or commercially know or sold as gasoline.
The blending of casinghead is not permitted in an ethanol blend fuel product in quantities
larger than required to denature the alcohol.
The majority of Ethanol Producers in South Dakota have a company that also markets the
ethyl alcohol. The marketing company purchases the ethyl alcohol from the Ethanol
Producer and resells it. This company will need to obtain an Ethanol Broker license.
Selling Ethanol Blends and Methanol Blends
With the 2009 South Dakota Legislative Session, it was decided to tax all Ethyl Alcohol
and Methyl Alcohol at the rate of $.08 per gallon plus the $.02 per gallon Tank Inspection
Fee. This was done because of various levels of ethanol blends now seen in the industry.
If an Ethanol Producer sells an ethanol blend or methanol blend, the bill of lading
and the invoice must list the alcohol gallons and gasoline gallons separately.
Record Keeping/Acceptable Records
To ensure that the correct amount of fuel tax is collected on all fuel used on South Dakota
roads and highways, the law requires Ethanol Producers to keep detailed records of all fuel
transactions and deliveries. Ethanol Producers will need these records to accurately
complete tax returns and must present them to Department personnel if they are audited or
have their licenses reviewed. Records are to be maintained for a period of at least 30 days
at the delivery location or a location approved by the Secretary. All records must be
preserved for the current year and the three preceding calendar years.
Fuel Sales, Purchase and Shipping Records
Licensed Ethanol Producers must keep all sales and purchase invoices in either their
original format, through film retrieval or electronic media. They must also maintain
shipping records that indicate the destination state for all products sold. The Consignee