Both Alaska and Wyoming have no state income tax (0%), making them two of the most tax-friendly states. However, Alaska has a unique advantage: the Permanent Fund Dividend (PFD) pays residents $1,312/year (2026 estimate). Alaska also has no state sales tax (though local sales taxes exist), while Wyoming charges 5.36%. Property taxes are similar (AK 1.04% vs WY 0.56%). Overall, Alaska offers the best tax deal in America, but Wyoming is far more accessible and less extreme climate-wise.

By Daniel, Founder of CountryTaxCalc

Daniel has spent 5+ years researching tax systems across 95+ countries and all US states to make tax comparison accessible to everyone. For corrections, contact us.

Last Updated: April 2026

The Big Picture

🐻 Alaska

0%

No Income Tax

0% + PFD dividend payments

🦬 Wyoming

0%

No Income Tax

Constitutional prohibition

Typical Annual Savings

At $100,000 income:

$0

That is $0/month back in your pocket!

Tax Savings by Income Level

IncomeAK TaxWY TaxSavings10-Year
$50,000 $0$0$0$0
$100,000 $0$0$0$0
$200,000 $0$0$0$0
$500,000 $0$0$0$0
💡

CountryTaxCalc.com is reader-supported. When you use our partner links, we may earn a commission at no cost to you. This helps us provide free tax calculators and comparison tools. Learn more about our affiliate partnerships

Talk to a Real CPA

TaxHub

★ 4.8 verified reviews  ·  3,758 reviews

Moving between Alaska and Wyoming? Both states have 0% income tax but Alaska has unique PFD rules. Get matched with a CPA who understands zero-tax state planning.

⚠ Not for simple single-state returns. Free filing is fine for straightforward W-2 situations.

Get Matched With a CPA →

Alaska Pros and Cons

✅ Pros

  • PFD dividend: Alaska PAYS YOU $1,312/year (family of 4 = $5,248/year)
  • No state sales tax: $0 (vs WY 5.36%) saves $536/year on $10k spending
  • Oil revenue funded: State services paid by oil royalties
  • Outdoor paradise: Glaciers, wildlife, fishing, Northern Lights
  • Adventure lifestyle: Unique frontier living experience

❌ Cons

  • Higher property tax: 1.04% (vs WY 0.56%) costs $1,200-$4,800 more/year
  • Extremely remote: Anchorage 291K, rest tiny villages
  • Very expensive: Food, gas, goods 30-50% more expensive (shipping costs)
  • Harsh climate: -30°F winters, 3 months darkness in northern regions
  • Limited access: Fly or ferry only (no road to Lower 48)

Wyoming Pros and Cons

✅ Pros

  • Lower property tax: 0.56% (lowest in US) saves $1,200-$4,800/year
  • More accessible: Drive to Denver 1.5 hours, Salt Lake 3 hours
  • Lower cost of living: Goods 30% cheaper than Alaska
  • Milder climate: -20°F vs AK -30°F, more sunshine
  • Dramatic scenery: Grand Tetons, Yellowstone, mountain ranges

❌ Cons

  • Sales tax: 5.36% (vs AK 0% state) costs $536/year
  • No PFD: Wyoming doesn't pay residents dividends (vs AK $1,312/year)
  • Very remote: Cheyenne only 100K (but drivable to civilization)
  • Harsh winters: -30°F, heavy snow (better than Alaska but still extreme)
  • Brain drain: Young professionals leave for Denver/Salt Lake

Frequently Asked Questions

Q: Both states have 0% income tax—what's the real difference?

Alaska's Permanent Fund Dividend (PFD). Alaska PAYS residents $1,312/year ($5,248 for family of 4). Alaska also has no state sales tax (vs WY 5.36%). However, WY has much lower property tax (0.56% vs AK 1.04%). On a $500k home, WY pays $2,800/year vs AK $5,200/year—difference of $2,400/year. Net advantage: Alaska wins by ~$450/year if you factor in PFD + sales tax savings, but WY is far more accessible.

Q: What is Alaska's Permanent Fund Dividend (PFD)?

Alaska's PFD pays every resident (including children) an annual dividend from oil royalty investments. 2026 estimate: $1,312 per person. A family of 4 receives $5,248/year. Requirements: Live in Alaska full year, intend to remain indefinitely. This effectively makes Alaska's tax rate NEGATIVE for most residents. No other state has anything comparable.

Q: Is Alaska's cost of living offset by PFD and no taxes?

Partially. Alaska goods cost 30-50% more due to shipping (food, gas, consumer goods). PFD ($1,312) + no state sales tax ($536 savings) = $1,848/year benefit. However, if you spend $30k/year on goods, 40% premium = $12k extra cost. You lose $10,152/year. Alaska works for high earners (0% income tax on $500k = $40k+ savings) or subsistence living. Not for average earners buying consumer goods.

Q: Which state is better for retirees?

Wyoming wins for retirees: accessible (drive to Denver), milder climate, lower property tax (0.56% vs AK 1.04%), lower cost of living. Alaska appeals to adventurous retirees who want frontier living, don't mind cold, and can afford expensive goods. Both have 0% income tax on retirement income. Choose WY for practical retirement. Choose AK for adventure.

Related Comparisons

Alaska CalculatorWyoming CalculatorMontana vs WyomingSouth Dakota vs WyomingAll State Comparisons