How are Wyoming Businesses Taxed?
If you start a new business in Wyoming there may be a few taxes that would be applicable depending on the type of business and the activity. The Wyoming tax rate will be different for different types of taxes and once you understand the business tax laws in Wyoming, it will help you to be better prepared for the filing of returns. It will also help in cutting down on any fines or unexpected fees. Hence, it is essential to ensure you have the necessary Wyoming business tax registration for filing tax returns. The different types of taxes in Wyoming include:
Wyoming corporate net income tax
Wyoming is considered as one of the least taxed states in the USA and the good news for businesses is that they will not be required to file a Wyoming business tax return for corporate income tax. However, if you have formed a C corporation then you may be required to pay what is known as the revenue tax. Business entities like S-Corporation or any other flow-through entities are not required to pay any corporate net income taxes on their revenue earned. There is a Federal Corporate Income Tax that will be applicable to businesses and the Wyoming tax rate will vary according to the tax bracket your business falls under like the marginal corporate income tax rate for the tax bracket $0 to $50,000 is 15 percent. You will need to apply for and obtain an Employer Identification Number (EIN) to file federal tax returns.
Are you planning to apply for a Federal tax ID?
Wyoming personal income tax
The Wyoming Income Tax Act – HB0147 states that any taxpayer generating income through business activity in this state will need to allocate as well as apportion the taxable income for the purposes of WY Stat § 39-12-101 (2017)(b)(iii)(F). However, Wyoming is also one of the few states that do not levy any personal income tax or Wyoming business tax. In fact, for specific business types like a limited-liability company including those that have elected to be taxed as a corporation, state income taxes will not be applicable.
Wyoming sales tax
Generally speaking, most states in the USA levy some form of state sales tax although the sales tax rate can vary from one state to another. As a comparison, the Wyoming tax rate is as low as 4% and a maximum of 6% while that of Tennessee is 9.53% and Arkansas is 9.47%. The 4% state sales tax is applicable in each of the counties and apart from this; counties can also add 1% to the state sales tax increasing it to 5%. This is also known as the “5th penny” and is an optional tax that requires the county voter’s approval. Wyoming also has a 6% Optional Special Purpose Sales Tax that is enforced by specific counties. In order to file sales tax, you will have to ensure Wyoming business tax registration using the Sales/Use Tax License Application issued by the Wyoming Department of Revenue.
Wyoming property tax
If you or a business owns any commercial or industrial real estate in the state of Wyoming then you will be required to pay property taxes on that real estate. Property tax is an important Wyoming business tax as it is considered to be one of the primary sources of funds for local governments, cities, school districts, and counties. The amount of property tax for Wyoming business tax return is based on the market value of the said commercial or industrial property.
What does commercial or industrial property include? This type of property takes into account different types of commercial as well as industrial structures. It is also important to understand that the market value of the property is different from the taxable value and the market value cannot be used for calculating Wyoming business tax return. The market value is the price of the property if and when it is being sold while the taxable value is the value that is used for calculating taxes that are due on the said property. Currently, the Wyoming tax rate for commercial property is assessed at 9.5% of their market value while industrial property is assessed at 11.5% of their market value.
Tax Information by Wyoming Department of Revenue
The Wyoming business tax requirements of every business are different. Some businesses may need to file only sales tax while other businesses may need to file sales and property taxes. The Wyoming Department of Revenue has a dedicated website that not only provides detailed information pertaining to the various taxes that are levied in the state but also provides forms for Wyoming business tax registration. You will also be able to take advantage of the information provided by them on Tax Relief Programs and E-Services programs for tax payment and registration.