Do you mean W-2G? Did you win money in SD at a casino or state lottery?
You first prepare a federal tax return (IRS) listing all your world-wide income, no matter how small, and calculate and pay the taxes you owe.
Then, since you have income outside your home state, you prepare a South Dakota non-resident tax return. Report only the income that was earned or paid in SD. You may have to manually allocate your items of income (i.e. 100% of the W-2G and zero percent of your wages, pensions, or any other income.) Depending on the laws of SD and your income, you may or may not owe tax to SD.
Then lastly, prepare a resident return for your home state that lists all your world-wide income. Your home state will give you a credit for taxes you paid to SD, which reduces the effect of double-taxation on the gambling winnings.
