Wyoming does not have a state income tax
Wyoming is one of nine states with no state income tax. You will not owe Wyoming state income tax on wages, investment income, retirement distributions, or self-employment earnings, regardless of how much you earn or how long you live there. This applies to residents and non-residents who work in Wyoming.
The absence of state income tax does not mean Wyoming has no taxes. The state funds schools, roads, and services through other sources: sales tax, property tax, mineral extraction taxes, and business taxes. Your federal income tax obligations remain unchanged — you still file a federal return and owe federal tax on all income.
If you moved to Wyoming from another state or are considering the move, you may need to file a final return in your previous state and notify them of your move. Some states require you to prove residency change before they stop taxing your income.
Key Takeaways
- Wyoming residents pay no state income tax on wages, self-employment income, pensions, or investment gains.
- You still owe federal income tax and must file a federal return each year.
- Wyoming funds state services through sales tax (currently 4 percent statewide), property tax, and taxes on mineral extraction and businesses.
- If you moved to Wyoming from another state, file a final return in that state and provide proof of residency change to stop owing state income tax there.
- Wyoming has no local income tax either — no cities or counties in the state impose income tax.
How Wyoming's tax system works without income tax
Wyoming relies on sales tax as its primary revenue source. The state sales tax rate is 4 percent, and most counties add a local sales tax on top of that, bringing the total to between 4 and 6 percent depending on where you shop. Food, prescription drugs, and some medical equipment are exempt from sales tax in Wyoming.
Property tax is the second major source of state revenue. Wyoming taxes real estate and, in some cases, personal property like vehicles and equipment. Property tax rates vary by county and municipality. If you own a home or land in Wyoming, you will receive a property tax bill from your county assessor.
Wyoming also taxes mineral extraction — oil, natural gas, coal, and other minerals removed from the ground. These taxes fund the state's general budget and education system. Severance taxes on minerals are significant in Wyoming because the state has substantial oil, gas, and coal reserves.
Businesses in Wyoming pay corporate income tax on net income, though the rate is lower than in many other states. Wyoming also has no franchise tax or business license tax, which makes it attractive to certain types of businesses.
What you still owe to the federal government
Living in Wyoming does not change your federal tax obligations. You must file a federal income tax return with the IRS if your income exceeds the filing threshold for your age and filing status. The threshold varies: for 2024, a single person under 65 must file if they earned more than $14,600 in wages.
You owe federal income tax on all types of income: W-2 wages, self-employment income, capital gains, dividends, interest, retirement distributions, and other sources. The federal tax rate depends on your income level and filing status, not on where you live.
If you are self-employed in Wyoming, you also owe self-employment tax to fund Social Security and Medicare. This is a federal obligation, not a state one. Self-employment tax is 15.3 percent of your net self-employment income (you can deduct half of it when calculating adjusted gross income).
Moving to Wyoming from another state
If you relocated to Wyoming during the tax year, you may need to file a part-year resident return in your previous state. Some states tax you as a resident for the entire year unless you provide proof of moving out before the tax year began.
To establish Wyoming residency for tax purposes, keep documentation of your move: a lease or deed showing your Wyoming address, utility bills in your name, a Wyoming driver's license or ID, voter registration, or employment records. Different states accept different proof, so check your former state's tax authority website for their specific requirements.
File your federal return as a full-year resident of Wyoming if you lived there on December 31 of the tax year. If you moved mid-year, you may file as a part-year resident of both states. The IRS does not require a residency declaration — your address on your federal return is your filing address, not necessarily your legal residence for tax purposes.
Wyoming sales tax and property tax you will pay
Even though Wyoming has no income tax, you will pay sales tax on most purchases. The state rate is 4 percent. Most counties add 1 to 2 percent more, so your total sales tax at checkout typically ranges from 4 to 6 percent.
Groceries (unprepared food), prescription medications, and some medical devices are exempt from Wyoming sales tax. Prepared food, restaurant meals, and non-prescription items are taxed. If you buy a vehicle in Wyoming, you pay sales tax on the purchase price.
Property tax in Wyoming is assessed on real estate and sometimes on personal property. The rate varies by county — some counties charge around 0.6 percent of assessed value annually, while others charge closer to 0.8 percent. You receive a property tax bill from your county assessor each year, usually in the fall or winter.
Self-employment and business income in Wyoming
If you are self-employed or own a business in Wyoming, you do not owe Wyoming state income tax on your business income. However, you still owe federal self-employment tax and federal income tax on your net business earnings.
Wyoming has no state-level business license tax or franchise tax, which means you do not pay an annual fee to the state straightforward for operating a business there. You may still need a local business license from your city or county, depending on your location and business type — check with your local government.
Keep records of all business income and expenses. You will report your net business income on your federal tax return (Schedule C if you are a sole proprietor, or the appropriate form for your business structure). The absence of state income tax does not reduce your federal tax burden or change how you calculate business deductions.
Retirement income and investment income in Wyoming
Wyoming does not tax retirement income. If you receive Social Security, pension payments, distributions from an IRA or 401(k), or other retirement income, you owe no Wyoming state tax on those amounts. This applies regardless of your age or the source of the retirement income.
Investment income — capital gains, dividends, and interest — is also not taxed by Wyoming. If you sell stock at a profit or receive dividend payments, you owe no state tax. You do owe federal tax on investment income, which is reported on your federal return.
This tax treatment makes Wyoming attractive to retirees and investors, though the lack of state income tax is only one factor in your overall tax situation. Property tax, sales tax, and federal taxes still explore.
Frequently Asked Questions
Do I have to file a Wyoming state tax return?
No. Wyoming has no state income tax, so there is no Wyoming state tax return to file. You file only your federal return with the IRS. If you lived in another state earlier in the year, you may need to file a part-year resident return in that state.
If I work in Wyoming but live in another state, do I owe Wyoming tax?
No. Wyoming does not tax income earned within the state by non-residents. You owe income tax only to your state of residence. However, your state of residence may tax your Wyoming wages, so check with that state's tax authority.
Does Wyoming tax Social Security or pension income?
No. Wyoming does not tax Social Security benefits, pension payments, IRA distributions, or other retirement income. You owe federal tax on these amounts if they exceed the federal threshold, but no Wyoming state tax.
What if I moved to Wyoming mid-year — do I file as a resident or non-resident?
You file as a part-year resident of Wyoming (and a part-year resident of your previous state if required). Your federal return shows your Wyoming address. Your previous state may require a part-year resident return; check that state's tax authority website for their rules.
Are there any Wyoming-specific deductions or credits I should know about?
No Wyoming-specific deductions or credits exist because Wyoming has no state income tax. All deductions and credits you use come from federal tax law. Your federal return is your only state-level tax filing.