The Irrevocable Letter of Credit is the South Dakota Department of Labor and Regulation form on which a bank establishes security, in favor of the Department, for the payment of workers' compensation claims. It names an applicant who is a self-insured employer, an aggregate amount and an expiry date, and it is signed by an authorized signer of the issuing bank. On FillingPDF you can fill out the irrevocable letter of credit online and download or print the completed PDF. The form is published by the Division of Labor and Management, and delivery follows the Division's instructions.
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What is Irrevocable Letter of Credit – South Dakota?
The Irrevocable Letter of Credit is the South Dakota Department of Labor and Regulation form by which a bank commits funds to the Department, as beneficiary, to secure the payment of workers' compensation compensation, costs and assessments owed by a self-insured employer. The Division of Labor and Management, at 123 W. Missouri Ave., Pierre, South Dakota 57501, publishes it.
The Division's instructions state that the letter of credit is considered security for the purpose of paying workers' compensation claims. The form has two parts: an application block (bank or financial institution, letter of credit number, date, confirming bank, applicant name, amount, date and place of expiry, and the beneficiary) and the letter itself, which sets the terms.
Under those terms, the bank honors a notarized, signed Order by the Director of the Division of Labor and Management that states the amount drawn and the letter of credit number. Partial drawings are permitted. The bank deposits the amounts drawn into a trust fund it establishes. The credit extends automatically for one year at a time unless the bank gives notice by registered mail at least sixty days before the expiry date. It is subject to the Uniform Customs and Practice for Documentary Credits (1983 Revision), International Chamber of Commerce Publication 400, or any subsequent revision.
All letters of credit are deposited with the Division. The form is not a petition, injury report or claim form; the Division lists those separately on its Workers' Compensation forms page.
Who needs to file Irrevocable Letter of Credit – South Dakota?
The form is used by a self-insured employer that gives the Division a letter of credit as security for workers' compensation obligations. The employer is the applicant named on the form, and the bank that issues the credit completes and signs it through an authorized signer.
- Issuing bank or financial institution: enters the letter of credit number, date, amount and expiry, and signs as "Very truly yours" with an authorized signature.
- Out-of-state banks: the instructions say that if the issuing bank is out of state, it may be necessary to list a South Dakota bank as a confirming bank.
- Self-insured employers: appear as the applicant and as the self-insured employer whose compensation, costs and assessments the credit secures.
The instructions bar changing the format of the letter before it is executed unless the Division of Labor and Management gives permission. The Division's forms page also says that employers who are currently self-insured do not need to resubmit a new security form unless the form of security or the amount is being changed. Anyone looking for injury, hearing or independent contractor forms should use the Division's separate forms.
When to file Irrevocable Letter of Credit – South Dakota
Use this form when a self-insured employer provides a letter of credit as its form of security to the Division of Labor and Management. The Division's forms page says that employers who are currently self-insured do not need to resubmit a new security form unless the form of security or the amount is being changed, so a new letter is relevant when security is first provided or when either of those changes.
The letter carries its own timing. It states a date and place of expiry, and it is considered automatically extended for one year from each relevant expiry date, unless the bank notifies the Division by registered mail at least sixty (60) days before that date that it elects not to extend. The form prints no other filing deadline.
How to fill out Irrevocable Letter of Credit – South Dakota
Ask the Division about the format
Before you execute the letter, remember that its format cannot be altered without permission from the Division of Labor and Management. Contact the Division if any wording needs to change.
Enter bank, number and date
In the application block, enter the Bank/Financial Institution, the Letter of Credit No. and the Date in the //_______ format.
List the confirming bank
Enter the Confirming Bank. If the issuing bank is out of state, it may be necessary to list a South Dakota bank here.
Enter applicant and amount
Write the Applicant Name and the Amount of the credit.
Enter the date and place of expiry
Complete Date and Place of Expiry. The Beneficiary is already printed: South Dakota Department of Labor and Regulation, 123 W. Missouri Ave., Pierre, SD 57501.
Complete the opening paragraph
Fill in the applicant name, the aggregate amount, the date drawn on, the name of the bank, and the name of the self-insured employer whose obligations are secured.
Complete item 1 details
Enter the letter of credit number, the name of the bank, the issue date and the expiration date in the blanks of item 1, matching the application block.
Leave the printed terms intact
Items 2 through 5 cover the trust fund deposit, the automatic one-year extension with sixty days' registered-mail notice, honoring requests, and the Uniform Customs and Practice for Documentary Credits. Do not alter them.
Add the authorized signature
An authorized signer of the issuing bank signs on the (Authorized Signature) line under "Very truly yours."
Review and download the PDF
Check that the names, amounts and dates agree throughout, then download or print the completed PDF from FillingPDF and deliver it as described under How to submit.
How to submit Irrevocable Letter of Credit – South Dakota
The form names one destination rather than a list of channels: all Irrevocable Letters of Credit are deposited with the South Dakota Department of Labor and Regulation, Division of Labor and Management, 123 W. Missouri Ave., Pierre, South Dakota 57501. That address also appears on the form as the beneficiary's address.
- Contact the Division first: Tel 605.773.3681, Fax 605.773.4211, website dlr.sd.gov. The form prints no mailing, upload or appointment procedure, so confirm how the Division wants the executed original delivered.
- Do not alter the format: the instructions say the format cannot be changed before execution without the Division's permission.
- Out-of-state bank: ask the Division whether a South Dakota confirming bank must be listed.
The Division's forms page also lets you reach the office through its "Can't Find a Form?" contact option. FillingPDF lets you fill out and download the PDF; submission follows the Division's instructions above.
Common mistakes to avoid
- Changing the wording or format of the letter before execution; the instructions say it cannot be altered without the permission of the Division of Labor and Management.
- Using an out-of-state issuing bank without checking whether a South Dakota bank must be listed as the confirming bank.
- Leaving the applicant name blank or inconsistent between the application block and the opening paragraph.
- Entering an expiry date that does not match the expiration date written into item 1 of the letter.
- Omitting the letter of credit issue date or number, which the Order by the Director must cite when drawing on the credit.
- Sending the letter unsigned; it ends with an authorized signature line for the bank.
- Treating the letter as a document for the Division's injury or hearing procedures; it is security for self-insured employers' obligations.
- Resubmitting security when nothing has changed; the Division says current self-insured employers need a new security form only if the form of security or amount changes.
Frequently asked questions
What is an irrevocable letter of credit for South Dakota workers' compensation?
It is a bank-issued security, on a South Dakota Department of Labor and Regulation form, for paying workers' compensation claims. The bank commits to honor a notarized, signed Order by the Director of the Division of Labor and Management, up to the stated aggregate amount.
Who issues and signs the Irrevocable Letter of Credit?
The bank or financial institution issues it, and an authorized signer of the bank signs it. The applicant named on the form is the self-insured employer whose compensation, costs and assessments the credit secures.
Can I change the wording of the letter of credit?
Not before execution without permission. The instructions state that the format of the Irrevocable Letter of Credit cannot be altered without the permission of the Division of Labor and Management, so contact the Division before changing anything.
Does an out-of-state bank need a South Dakota confirming bank?
It may. The instructions say that if the issuing bank is out of state, it may be necessary to have a South Dakota bank listed as a confirming bank. Ask the Division at 605.773.3681 before you finalize the form.
Does the letter of credit renew automatically?
Yes. It is considered automatically extended for one year from each relevant expiry date, unless the bank notifies the Division by registered mail at least sixty (60) days before that date that it elects not to extend.
Where do I send the Irrevocable Letter of Credit?
The form says all letters are deposited with the Division of Labor and Management, 123 W. Missouri Ave., Pierre, South Dakota 57501. It prints no other delivery channel, so call 605.773.3681 or fax 605.773.4211 to confirm how to deliver it.
Can I fill out the irrevocable letter of credit online?
You can fill out the PDF online on FillingPDF and download or print it. FillingPDF is an independent service and does not deliver the letter to the Division; delivery follows the Division's instructions.
Do current self-insured employers need to submit a new letter each year?
Not necessarily. The Division's forms page says currently self-insured employers do not need to resubmit a new security form unless the form of security or the amount is being changed.
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