Wyoming does not have a state income tax
Wyoming is one of nine states with no state income tax on wages, salaries, or investment income. You will not file a Wyoming state income tax return, and your employer will not withhold state income tax from your paycheck. This applies whether you work in Wyoming, live in Wyoming, or both.
However, no state income tax does not mean no state taxes. Wyoming collects revenue through sales tax, property tax, and excise taxes on specific goods. The state also taxes business and corporate income, though not individual wages.
If you moved to Wyoming from another state or are considering the move, understanding what taxes you do owe — and what you don't — affects your take-home pay and your filing obligations.
Key Takeaways
- Wyoming has no tax on individual wages, salaries, tips, or investment income, so you will not file a state income tax return.
- Wyoming does collect sales tax (currently 4 percent statewide, plus local additions), property tax, and excise taxes on fuel, alcohol, and tobacco.
- If you work in Wyoming but live in another state, you still owe no Wyoming income tax on your wages.
- If you moved to Wyoming from a state with income tax, you may still owe taxes to your former state for income earned before you left.
- Federal income tax is separate from state income tax and applies to all workers regardless of where they live.
What taxes Wyoming residents do pay
The absence of state income tax does not mean Wyoming has no taxes. The state funds schools, roads, and services through other revenue sources.
Sales tax is the primary alternative. Wyoming's statewide sales tax rate is 4 percent, but most counties and cities add local sales tax on top of that. Your total sales tax rate depends on where you make the purchase. A purchase in Cheyenne may have a different total rate than one in Jackson. You pay sales tax on most goods and some services, though groceries are generally exempt.
Property tax is assessed by county and varies significantly across the state. Wyoming's property tax rates are among the lowest in the nation, but the exact amount you pay depends on your county, your home's assessed value, and local school district rates. Property owners receive the tax bill from their county assessor.
Excise taxes apply to fuel, alcohol, and tobacco. These are embedded in the price you pay at the pump or store, so you may not see them as a separate line item.
Federal income tax still applies in Wyoming
Wyoming's lack of state income tax does not affect your federal tax obligation. You must still file a federal income tax return with the IRS and pay federal income tax on your income. Your employer will withhold federal income tax from your paycheck based on the W-4 form you complete.
When you file your federal return, you report your total income, deductions, and credits to the IRS. The fact that Wyoming has no state income tax does not change what you owe federally or what forms you file with the federal government.
If you are self-employed or have income from sources other than an employer, you are responsible for paying estimated federal taxes quarterly. This obligation exists regardless of your state's tax structure.
Moving to Wyoming from a state with income tax
If you relocated to Wyoming from a state that has income tax, you may still owe taxes to your former state for income you earned there before you moved. Most states tax income earned within their borders during the tax year, even if you no longer live there.
For example, if you worked in California from January through June and moved to Wyoming in July, California will tax the income you earned from January through June. You would file a part-year resident return in California for that period. Wyoming will not tax any of your income, whether earned before or after the move.
The key date is when you establish residency in Wyoming. Moving your residence, changing your driver's license, and registering your vehicle in Wyoming are the steps that establish your new residency status. Keep documentation of your move date, as your former state may request it.
Working in Wyoming while living in another state
If you live in another state but work in Wyoming, you do not owe Wyoming income tax on your wages. Wyoming does not tax income earned by non-residents working within the state.
However, you will owe income tax to the state where you live. That state taxes you on your total income, regardless of where you earned it. You may also be required to file a non-resident return in Wyoming, though this is typically a formality since you owe no tax. Check with your home state's tax authority about filing requirements.
If you work remotely for a Wyoming employer but live in another state, the same rule applies: you owe tax to your home state, not to Wyoming.
Self-employment and business income in Wyoming
Wyoming does not tax individual self-employment income, but the state does tax business and corporate net income. If you operate a sole proprietorship or are self-employed, you do not pay Wyoming state tax on your business income.
However, you must pay federal self-employment tax and federal income tax on that income. You will also owe income tax to any other state where you live or do business, depending on that state's rules.
If you form a corporation or LLC in Wyoming, the entity itself may owe Wyoming corporate tax depending on its structure and where it does business. Consult a tax professional or the Wyoming Department of Revenue for guidance specific to your business structure.
Retirement income and investment income
Wyoming does not tax retirement income, including distributions from IRAs, 401(k)s, pensions, or annuities. You will not pay Wyoming state tax on Social Security benefits, either. This is one reason Wyoming is attractive to retirees.
Investment income — including capital gains, dividends, and interest — is also not taxed by Wyoming. If you sell stock or real estate at a profit, you owe federal capital gains tax but no Wyoming state tax on that gain.
You still owe federal tax on all of these income types. The Wyoming advantage applies only to state-level taxation.
Frequently Asked Questions
Do I have to file a Wyoming state income tax return?
No. Wyoming has no state income tax, so you will not file a Wyoming state return. You will still file a federal return with the IRS if your income exceeds the federal threshold for your filing status.
If I moved to Wyoming, do I owe taxes to my old state?
You may owe taxes to your former state for income earned there before you moved and established Wyoming residency. Most states tax income earned within their borders during the tax year. File a part-year resident return in your former state for the months you lived there.
Does Wyoming tax Social Security or retirement income?
No. Wyoming does not tax Social Security benefits, pension distributions, IRA withdrawals, or other retirement income. You will not owe Wyoming state tax on these sources, though federal tax may still apply.
What if I work remotely for a company in another state but live in Wyoming?
You do not owe Wyoming income tax. You will owe income tax to the state where the company is located or where you are considered a resident for tax purposes. Check your home state's rules on remote work taxation.
Are there any other taxes I should know about in Wyoming?
Yes. Wyoming collects sales tax (4 percent statewide plus local additions), property tax (varies by county), and excise taxes on fuel, alcohol, and tobacco. These taxes fund state and local services in place of income tax revenue.