A state audit has found that some South Dakota motorists paid more motor vehicle excise tax than they owed following the rollout of the state’s new 605Drive vehicle registration system.
The Department of Revenue launched 605Drive in February of 2025, replacing the previous SDCars platform used for vehicle titles, registrations, and tax calculations.
According to the state’s fiscal year 2025 audit, errors in vehicle trade-in values resulted in some customers being overcharged. Auditors found that trade-in information either failed to transfer correctly or was entered incorrectly during some transactions. Because trade-in values reduce the taxable amount of a vehicle purchase, the mistakes led to higher excise tax bills.
Auditors identified approximately $1,400 in overpayments across three transactions. While the total dollar amount was relatively small, auditors noted the new system had processed more than seven hundred fifty thousand transactions.
The audit also found that the safeguards designed to catch those errors did not work. Both automated system checks and manual review processes failed to identify the incorrect tax calculations.
The Department of Revenue says it is taking corrective action, including reviewing past transactions, issuing refunds where overpayments occurred, adding a compliance auditor, and providing additional staff training.
State officials say the finding underscores the challenges that can come with major technology upgrades and the importance of closely monitoring new systems after implementation.
