Wyoming Has Largest Income Gap with Top 1% Reporting Nearly One-Third of Statewide Earnings
According to an analysis of IRS data, Wyoming has the largest income gap in the U.S., where the top 1% of tax filers reported nearly one-third (32%) of all statewide earnings. This is more than double the share seen in West Virginia and reflects a growing trend across many states where the wealthiest individuals collectively out-earn the bottom half of earners. The income disparity is influenced by factors such as migration patterns, urban-rural divides, and tax policies. States like Wyoming, Florida, and Nevada—none of which impose personal income taxes—are attracting wealthier residents seeking to minimize their tax liabilities. In 37 states plus Washington D.C., the top 1% reported more combined income than the bottom half. The data highlights how capital gains increasingly contribute to high-income earners' total earnings, especially in places like Wyoming where they account for nearly 40% of the top 1%'s adjusted gross income. Analysts suggest that policy choices and financial secrecy are playing a growing role in shaping these disparities.
