Wyoming Tax Calculator

Income Tax
0%
no state income tax
Sales Tax
5.44%
avg combined
Property Tax
0.56%
among lowest US

Wyoming Income Tax: Zero — Always Has Been

Wyoming is one of only seven states with no individual income tax, and it stands out even among that group: Wyoming has never had an income tax in its entire history as a state (admitted in 1890). While other no-income-tax states like Alaska, Florida, and Texas have constitutional provisions barring income taxes, Wyoming simply has never enacted one. There is no constitutional prohibition, but the political culture strongly opposes any income tax, and no serious proposal has ever gained traction.

Wyoming also has no corporate income tax, making it one of just a few states with neither individual nor corporate income tax (alongside South Dakota and Nevada, which uses a modified business tax instead). This double absence makes Wyoming particularly attractive for business formation. Wyoming is also a popular state for LLC and trust formation due to its privacy laws and lack of income tax on pass-through entities.

The absence of income tax means all earnings — wages, investment income, retirement distributions, Social Security benefits — are completely untaxed at the state level. For a household earning $150,000, this saves approximately $5,000-$8,000 annually compared to states with typical income tax rates of 4-6%.

How Wyoming Funds Its Government

Wyoming's ability to operate without an income tax relies on a unique revenue model built around mineral extraction. The state is the nation's largest coal producer, a top-10 oil producer, and a major natural gas producer. Revenue comes from several sources:

  • Mineral severance taxes: 6% on coal surface mining, 2% on oil, 6% on natural gas, and 4% on trona (a mineral used in soda ash production). These taxes generated over $800 million in fiscal year 2024.
  • Federal mineral royalties: Wyoming receives approximately 48% of royalties from mineral production on federal lands within the state, worth roughly $1 billion annually.
  • Permanent Mineral Trust Fund: Established by constitutional amendment in 1974, this fund receives 1.5% of mineral production value. It has accumulated over $8 billion and generates significant investment income for the state budget.
  • Sales and use taxes: The 4% state sales tax plus local additions generates approximately $1.2 billion annually.
  • Property taxes: Primarily local revenue, with mineral production equipment taxed at the same rate as commercial property.

This mineral-dependent model has made Wyoming vulnerable to commodity price swings. During oil and coal downturns, the state has faced budget shortfalls, leading to cuts in education and infrastructure spending. The legislature has periodically discussed diversifying revenue but has consistently rejected income tax proposals.

Wyoming Sales Tax

Wyoming levies a 4% state sales tax, one of the lowest state-level rates in the country. Counties may add up to 2% in local option taxes, bringing the average combined rate to approximately 5.44%. Most counties levy an additional 1% general-purpose tax, with some tourism-heavy areas (like Teton County/Jackson Hole) adding resort district taxes.

Food for home consumption (groceries) is exempt from Wyoming sales tax, providing significant savings for residents. Prescription drugs and medical devices are also exempt. Wyoming does not tax most services, and it has a broad manufacturing exemption for equipment and raw materials used in production. The state joined the Streamlined Sales Tax Governing Board to simplify compliance for multi-state businesses.

Wyoming Property Tax

Wyoming's effective property tax rate is approximately 0.56%, ranking among the 10 lowest in the nation. Residential property is assessed at 9.5% of fair market value, while commercial and industrial property is assessed at 11.5%. Agricultural land is assessed based on productive capacity rather than market value, benefiting the state's extensive ranching operations.

Unlike many states, Wyoming does not offer a traditional homestead exemption. However, the state provides a property tax refund program for low-income residents (income below $47,100 for a family of 4) and veterans. The maximum refund is $800 for owner-occupied homes. Disabled veterans with 100% disability rating may qualify for a property tax exemption on their primary residence.

Teton County (home to Jackson Hole) is a notable exception to Wyoming's low property taxes. Due to extremely high property values driven by luxury real estate and resort development, homeowners in Teton County can face significant property tax bills despite the low effective rate. The median home price in Teton County exceeds $2 million, compared to the statewide median of approximately $280,000.

Wyoming for Business and Trusts

Wyoming has become one of the most popular states for business formation and asset protection. Key advantages include:

  • No corporate income tax and no franchise tax
  • Dynasty trusts with 1,000-year duration (effectively perpetual asset protection)
  • Strong LLC privacy: Wyoming was the first state to create the LLC structure (1977) and offers nominee officers/directors
  • No information sharing agreements with the IRS for certain entity types
  • Low annual fees: LLC annual report fee is just $60
  • Directed Trust Company Act: Allows division of trust responsibilities for optimal management

Wyoming's trust laws have attracted significant wealth management activity, competing with South Dakota, Nevada, and Delaware as top trust jurisdictions. The state's combination of no income tax, no estate tax, and extended trust durations creates a compelling package for high-net-worth individuals and family offices.

Wyoming vs. Neighboring States

  • Montana — Montana has a graduated income tax up to 6.75% with no sales tax. Property tax is 0.74%. For income tax, Wyoming is vastly cheaper. Montana's no-sales-tax advantage is offset by its income tax for most earners.
  • Colorado — Colorado has a 4.4% flat income tax. Sales tax averages 7.79%. Property tax is 0.49% (slightly lower than Wyoming). Wyoming's zero income tax saves a Colorado family earning $100,000 roughly $3,500-$4,000 per year.
  • South Dakota — South Dakota also has no income tax and no corporate income tax. Sales tax averages 6.40% (higher than Wyoming). Property tax is 1.01% (nearly double Wyoming's). Wyoming edges South Dakota on overall tax burden.
  • Idaho — Idaho has a flat 5.8% income tax. Sales tax averages 6.02%. Property tax is 0.63%. Wyoming is significantly cheaper on income tax. Idaho's growing Boise metro area has driven population growth, but many prefer Wyoming's lower taxes and wide-open spaces.
  • Utah — Utah has a flat 4.65% income tax. Sales tax averages 7.19%. Property tax is 0.52% (slightly lower than Wyoming). Wyoming's zero income tax is a major advantage for higher earners.

Frequently Asked Questions

Does Wyoming have a state income tax?
No. Wyoming has never had a state income tax. It is one of seven states with no individual income tax, and it also has no corporate income tax. All earnings, investment income, and retirement income are completely untaxed at the state level.
How does Wyoming fund its government?
Wyoming relies primarily on mineral severance taxes (coal, oil, gas), federal mineral royalties, sales tax (4% state rate), and investment income from its $8 billion+ Permanent Mineral Trust Fund. The state is the nation's largest coal producer.
What is Wyoming's sales tax rate?
Wyoming has a 4% state sales tax, with counties able to add up to 2%. The average combined rate is about 5.44%. Groceries and prescription drugs are exempt from sales tax.
Is Wyoming good for retirees?
Wyoming is one of the most tax-friendly states for retirees. No income tax means Social Security, pensions, 401(k)s, and IRAs are all untaxed. Property taxes are very low (0.56%), and there is no estate or inheritance tax.
Why do people form LLCs in Wyoming?
Wyoming was the first state to create the LLC (1977) and offers strong privacy protections, no corporate income tax, low annual fees ($60), and no information-sharing agreements for certain entities. Its trust laws allow 1,000-year dynasty trusts.