Detailed answer (how South Dakota law treats sale proceeds when someone dies intestate)

When a person dies without a valid will (intestate) in South Dakota, any money that belongs to their estate — including leftover proceeds from the sale of real estate or other property — becomes part of the decedent’s estate. A court-appointed personal representative (often called an administrator) will collect those assets, pay valid debts and expenses, and then distribute the remaining funds according to South Dakota’s intestate succession rules.

Who holds the proceeds right after death?

If the property was sold before the person died but some proceeds remained unpaid, or if a buyer paid into escrow and a title issue or other matter delayed distribution, the money is an estate asset. If the sale closed after the person died, the personal representative signs for the estate and the proceeds are estate property.

Who gets paid first from those proceeds?

The administrator must use estate assets (including sale proceeds) to pay, in order generally set by probate rules:

• funeral and last illness expenses;
• administration costs and court fees;
• taxes owed by the decedent or the estate;
• reasonable attorney and executor/administrator fees (as allowed by the court); and
• valid creditor claims filed against the estate.

Only after these claims are paid will any remaining balance be distributed to heirs under intestate succession.

How South Dakota law determines who inherits

South Dakota law sets the order of inheritance when someone dies without a will. Typical priority is spouse and descendants (children), then parents, then siblings and more remote relatives. If no eligible heirs exist or if heirs cannot be located, the estate may eventually escheat (pass) to the State of South Dakota. For statutory text and details, see South Dakota’s probate statutes (Title 29A): sdlegislature.gov — Title 29A (Probate).

Common scenarios involving sale proceeds

• Sale completed before death, seller died before receiving net funds: The net funds are payable to the decedent’s estate. The administrator collects them and treats them like other estate assets.
• Property sold after death by the administrator: The administrator is authorized to sell estate property; sale proceeds go into the estate, pay debts and costs, then pass to heirs under intestacy.
• Co-owners or joint tenants: If the decedent owned property jointly with rights of survivorship, the surviving joint owner(s) may automatically own the asset; in that case, sale proceeds may belong to the survivor(s) rather than the estate. The ownership form matters and can change who gets proceeds.
• Escrow disputes or title defects: Escrow agents often hold disputed funds until a court or the parties agree who is entitled to them. If the decedent is a party, the estate (through the administrator) normally must assert a claim.

When estate funds may escheat to the state

If the administrator cannot find heirs after reasonable inquiry, and no one makes a timely claim, South Dakota law provides procedures for escheat to the state. The court and state have rules that govern notice and waiting periods before that happens. For probate procedures and court resources see the South Dakota Unified Judicial System: ujs.sd.gov (South Dakota Courts).

Practical timeframes

Probate timing varies by case complexity. Creditors typically have a limited time to present claims. The administrator should not distribute funds to heirs until allowed claims and taxes are resolved or until the court approves distribution. Acting too early can create personal liability for the administrator.

Basic steps an heir or claimant should take

1. Confirm whether a probate case has been opened in the county where the decedent lived. The county probate court handles appointment of an administrator and supervises distribution.
2. If you think you are owed sale proceeds, contact the personal representative or the probate court clerk and ask how to make a claim.
3. Gather documents proving your claim: sale contract, escrow statements, proof of ownership or beneficiary interest, death certificate, and identification.
4. If the estate is small, ask the court about simplified or small-estate procedures that may allow faster distribution without full probate.

For statutory authority and probate procedures, start here: South Dakota Codified Laws, Title 29A (Probate), and the South Dakota Unified Judicial System: ujs.sd.gov.

Disclaimer: This article explains general principles of South Dakota probate law and is not legal advice. It does not create an attorney-client relationship. For advice about a specific situation, contact a licensed South Dakota attorney who handles probate and estate matters.

Helpful Hints

• Act promptly: probate deadlines and creditor claim periods can bar claims if you wait too long.
• Find the personal representative: that person controls estate assets and can tell you whether funds exist and how to file a claim.
• Check property records and escrow paperwork to confirm whether sale proceeds were paid and to whom.
• Do not accept informal distributions before probate approval — administrators who distribute too soon can be held personally liable.
• If you and other heirs disagree about distributions or ownership, consider mediation or legal advice; court fights can eat up estate value.
• If the estate appears small, ask the court about simplified procedures that could speed up payment to heirs.
• When ownership involved joint tenancy, payable-on-death designations, or trusts, those terms may govern disposition instead of intestacy rules.
• Keep records: copies of sale contracts, escrow closing statements, death certificate, and any correspondence with the administrator or escrow agent will help support your claim.

If you need help locating court records, filing a claim, or understanding how South Dakota intestate rules apply to the sale proceeds in your situation, consult a South Dakota probate attorney.