Key Takeaways

  • Wyoming imposes no corporate income tax and no personal income tax, making it a highly tax-friendly state for businesses.
  • There is no franchise or gross receipts tax in Wyoming, and sales tax is among the lowest in the country.
  • The annual report license tax is Wyoming's main business tax, calculated based on the value of in-state assets.
  • Businesses must still file federal taxes and may need to register for sales and use tax depending on their operations.
  • Nexus laws may require out-of-state businesses with economic presence in Wyoming to register and remit taxes.
  • Certain industries, such as mining and oil & gas, face specific excise taxes and reporting obligations.
  • You can consult with a business attorney on UpCounsel to ensure compliance with all Wyoming business tax obligations.

Wyoming corporate tax, while business-friendly, does requires some research if you want to make the tax process as simple as possible. If you are planning to set up a business in Wyoming or have an established business and want to make sure you are complying with all tax laws, there are a couple of points you want to keep in mind.

Understanding Wyoming's business tax laws will ensure that you are better prepared for the filing process and cut down on unexpected fees or fines if tax laws are not complied with. While Wyoming tax laws are not overly complicated or burdensome, you want to make sure you are fully informed before filing or working with an accountant to file.

Business Filing Fees

One thing you want to keep in mind when filing taxes as a corporation is the annual fee required when filing your tax report. This fee is required by corporations or LLCs and is based on in-state assets. The filing fees follow a simple formula to determine the amount owed each year.

  • If your assets are less than $250,000, the fee is a simple $50 payment.
  • Anything above this $250,000 limit will be valued at $.0002 on the dollar.
  • Use this formula: total in-state assets x $.0002 = annual fee.

For instance, if your total in-state assets are $300,000, the fee would be calculated by multiplying $300,000 by $.0002, coming out at $60. Another $2 convenience fee is added if you file online.

While these fees are not large sums, they are something you want to keep in mind when planning your filing. Maintaining complete records of your assets will help you prepare for the filing fees ahead of time.

Annual Report License Tax in Wyoming

Wyoming does not impose a corporate income tax, but businesses must still file an annual report and pay the Annual Report License Tax. This fee is based on the assessed value of in-state assets:

  • Minimum tax: $50 for entities with less than $250,000 in in-state assets.
  • For assets over $250,000: $0.0002 per dollar of assessed value.

This tax is due every year by the first day of the anniversary month of formation. Businesses must file through the Wyoming Secretary of State’s website or by mail. Failure to file can result in administrative dissolution.

Advantages of Filing Taxes in Wyoming

Wyoming is considered one of the friendliest states regarding taxes. With the smaller percentages for sales tax and lighter burdens for businesses compared to many other states, Wyoming is an ideal state to set up a new business. Some of the advantages to Wyoming's tax laws include:

  • No entity tax for corporations.
  • No personal income taxes.
  • 4 percent state sales tax, one of the lowest in the United States. Even with added taxes within different counties or municipalities, the tax rate is normally no higher than 6 percent.
  • Low property tax percentages.

Corporations in Wyoming are mostly spared from double taxation through this system where entity taxes are not required, and employees are able to keep more of their income by avoiding personal income taxes. This allows people to keep more of their earned money, allowing for more access to consumers in the market.

The state and municipal taxes in Wyoming are some of the lowest in the United States. This allows for a more competitive market and makes it easier for businesses to sell products and services. These businesses are required to file a sales application with the Department of Revenue for sales tax purposes, but it is a simple application process.

Sales and Use Tax Obligations

Even though Wyoming has no business income tax, businesses must comply with sales and use tax laws if they sell taxable goods or services. Key points include:

  • Statewide base rate: 4%.
  • Local taxes: May add up to 2%, bringing the total to a maximum of 6%.
  • Businesses must obtain a Wyoming Sales and Use Tax License through the Department of Revenue before collecting tax.
  • Use tax applies when businesses purchase out-of-state goods without paying sales tax and bring them into Wyoming.

Businesses operating solely online may still need to collect and remit sales tax if they meet economic nexus thresholds, such as $100,000 in annual sales or 200 separate transactions into Wyoming.

Biggest Tax Requirement, Property Tax

The biggest tax burden for residents of Wyoming is the property tax. While significantly lower than most other states, the property tax is the biggest portion of taxes collected in the state. Property taxes are collected based on the fair market value (FMV).

For residential and commercial property, the tax collected is 9.5 percent of the value of the property. For industrial lands, this percentage goes up to 11.5 percent. This is the state requirement, but a local mill levy rate (MLR) is added based on each area's rates for residential and commercial property. To calculate this rate, you can use this formula: (FMV x 9.5 percent) x MLR = Property Tax.

The biggest property tax burden falls on minerals. Wyoming state taxes minerals at 100 percent of the fair market value.

Industry-Specific Taxes in Wyoming

Wyoming's tax-friendly reputation does not exempt all industries from specialized taxes. Some of the notable industry-specific obligations include:

  • Mining and natural resources: Severance taxes apply to extraction of oil, gas, coal, and other minerals. These are based on volume and market value.
  • Lodging taxes: Applied to short-term accommodations.
  • Excise taxes: Imposed on alcohol, tobacco, and fuel.

These taxes may require separate filings and compliance documentation beyond standard business taxes.

C Corporations Versus S Corporations

While the general tax laws for Wyoming prevent double taxation, this is not always the case for C corporations. C corporations are required to pay revenue taxes, unlike S corporations. On top of this revenue tax, owners and shareholders are required to pay personal income taxes on any profits that are withdrawn from the company. This means that profits for C corporations can be subject to double taxation.

This problem does not exist for S corporations because they do not have the same revenue tax burdens. Members of these types of corporations are required to pay personal income tax on their share of the company's profits for Wyoming and federal income tax. This does not include employees of a corporation, but rather the owners and board members.

Federal Tax Responsibilities and Multi-State Considerations

Although Wyoming does not impose a state corporate income tax, businesses must still meet all federal tax filing obligations with the IRS. These include:

  • Form 1120 for C corporations.
  • Form 1120-S for S corporations.
  • Form 1065 for partnerships and LLCs treated as partnerships.

Additionally, businesses operating in multiple states must be mindful of nexus rules. Even if your business is formed in Wyoming, having employees, inventory, or substantial sales in another state may trigger tax obligations in that jurisdiction.

Common multi-state compliance issues include:

  • Filing foreign registration in other states.
  • Collecting sales tax in states where nexus is established.
  • Paying income or franchise taxes where applicable.

It is important to structure your operations and accounting practices accordingly to avoid penalties.

Frequently Asked Questions

  1. Does Wyoming have a corporate income tax?
    No, Wyoming does not impose a corporate or personal income tax.
  2. What taxes do businesses in Wyoming have to pay?
    Primarily, businesses must pay the Annual Report License Tax and possibly sales, use, or industry-specific taxes depending on operations.
  3. Do I need to collect sales tax in Wyoming?
    Yes, if you sell taxable goods or services, you must collect sales tax and file with the Department of Revenue.
  4. Are out-of-state businesses taxed in Wyoming?
    Only if they have nexus in the state, such as physical presence or meeting economic thresholds.
  5. When is the Wyoming Annual Report due?
    It is due by the first day of your business’s anniversary month of formation each year.

If you need help navigating the corporate tax laws for Wyoming, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.