Business-Friendly State--Wyoming
Wyoming is a doubly landlocked state in the western United States. The state is the 10th largest by area, the least populous, and the second most sparsely populated state in the country. The tax climate in the state is incredibly business-friendly. Wyoming does not have a corporate income tax, nor does it have an individual income tax or gross receipts tax. The state has a 5% tax, but the average local tax is .42% making a total of 5.42%, which is fairly low.
Although Wyoming business entities do not need to pay state income tax, they are required to pay following taxes:
1. Federal Income Tax Return
According to Internal Revenue Service (IRS), all business entities must file an income tax return on or before the following April 15th (Corporation) or March 15th (LLC) of the tax year, or Oct 15th (Corporation) or Sep 15th (LLC) with extension, if calendar year is applied on tax purpose. However, the business entity must pay the tax due in full no later than the original due date for filing its tax return (not including extensions). Interest and penalty will be charged on taxes paid late even if an extension of time to file is granted.
2. Sales or Use Tax
Sales tax is a tax imposed upon sales or lease of tangible personal property and certain services rendered within Wyoming. The use tax generally applies to the storage, use, or other consumption in Wyoming of goods purchased from retailers in transactions not subject to the sales tax. Use tax may also apply to purchases shipped to a Wyoming consumer from another state, including purchases made by mail order, telephone, or Internet.
3. Payroll Tax
If the business entities have employees and pay wages in U.S., they must report income and payroll taxes withheld from their employees to Internal Revenue Service (IRS) periodically. The business entities are also responsible for filing and paying Social and Medicare Taxes (employer share amount) and Federal Unemployment Taxes. Employers in Wyoming are required to contribute to Unemployment Insurance Tax (UI). There is no state withholding tax for Wyoming.
All active business entities registered at Wyoming are required to operate in compliance with the General Corporation Law/Limited Liability Company Act of the State of Wyoming. They must have and maintain a registered agent, which has a physical street address in Wyoming; file annual report and pay annual license tax with the Wyoming Secretary of State every year; and renew the business license/permit periodically(if applicable). The annual report is due on the first day of the anniversary month. If entity fails to file the required Annual Report within 60 days, state may dissolve the entity. If you are interested in Wyoming business registration or annual renewal services, please contact Kaizen professional consultants.
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