S.D. Codified Laws § 3-13C-3
For the purposes of this chapter, compensation means an employee's fixed rate of pay from the employer. Compensation includes differential wage payments. Except as provided in this section, compensation for a specified period is the compensation actually paid or made available during that period. Compensation for a plan year also includes compensation paid by the later of two and one-half months after an employee's severance from employment with the employer maintaining the plan or the end of the plan year including the date of the employee's severance from employment with the employer, if the payment is regular compensation for services during the employee's regular working hours, or compensation for services outside the employee's regular working hours, commissions, bonuses, or other similar payments, and, absent a severance from employment, the payments would have been paid to the employee while the employee continued in employment with the employer.
Any payments not described in the preceding paragraph are not considered compensation if paid after severance from employment, even if paid by the later of two and one-half months after the date of severance from employment or the end of the plan year including the date of severance from employment.
Back pay, within the meaning of 26 C.F.R. § 1.415(c)-2(g)(8), shall be treated as compensation for the plan year to which the back pay relates to the extent the back pay represents wages and compensation that otherwise would be included in this definition.
Compensation paid or made available during a specified period includes amounts that would otherwise be included in compensation, but for an election under 26 U.S.C. § 125(a), 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k), or 457(b). Compensation includes employee contributions picked-up by a governmental entity and, pursuant to 26 U.S.C. § 414(h)(2), treated as employer contributions.
The annual compensation of each participant taken into account in determining contributions and benefits for any determination period, which is the period over which compensation is determined, may not exceed the limits established in 26 U.S.C. § 401(a)(17), as adjusted for cost-of-living increases in accordance with 26 U.S.C. § 401(a)(17)(B). The cost-of-living adjustment in effect for a calendar year applies to any determination period beginning with or within that calendar year.
SDCL 3-13C-3