INCOME TAXES

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 18: INCOME TAXES

This note provides details about income taxes applicable to our operations, including the following:

	earnings before income taxes,
	provision for income taxes,
	effective income tax rate,
	deferred tax assets and liabilities and
	unrecognized tax benefits.

The Income Taxes section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our income taxes.

EARNINGS BEFORE INCOME TAXES

Domestic and Foreign Earnings Before Income Taxes

DOLLAR AMOUNTS IN MILLIONS
	2024		2023		2022
Domestic earnings	$	192	$	737	$	1,982
Foreign earnings		235		200		323
Total earnings before income taxes	$	427	$	937	$	2,305

PROVISION FOR INCOME TAXES

DOLLAR AMOUNTS IN MILLIONS
	2024			2023			2022
Current:
Federal	$	1		$	37		$	252
State		2			8			45
Foreign		68			57			158
Total current		71			102			455
Deferred:
Federal		(32	)		1			28
State		(5	)		(3	)		6
Foreign		(3	)		(2	)		(64	)
Total deferred		(40	)		(4	)		(30	)
Total income tax provision	$	31		$	98		$	425

EFFECTIVE INCOME TAX RATE

DOLLAR AMOUNTS IN MILLIONS
	2024			2023			2022
U.S. federal statutory income tax	$	90		$	197		$	484
State income taxes, net of federal tax benefit		(1	)		3			41
REIT income not subject to federal income tax		(60	)		(114	)		(125	)
Foreign taxes		16			14			27
Intra-entity transfers		(15	)		(2	)		(1	)
Other, net		1			—			(1	)
Total income tax provision	$	31		$	98		$	425
Effective income tax rate		7.4	%		10.5	%		18.4	%

DEFERRED TAX ASSETS AND LIABILITIES

Deferred tax assets and liabilities reflect the future tax effect created by differences between the timing of when income or deductions are recognized for pretax financial book reporting purposes versus income tax purposes. Deferred tax assets represent a future tax benefit (or reduction to income taxes in a future period), while deferred tax liabilities represent a future tax obligation (or increase to income taxes in a future period).

Balance Sheet Classification of Deferred Income Tax Assets (Liabilities)

DOLLAR AMOUNTS IN MILLIONS
	DECEMBER 31,  2024			DECEMBER 31, 2023
Net noncurrent deferred tax asset	$	24		$	15
Net noncurrent deferred tax liability		(26	)		(81	)
Net deferred tax liability	$	(2	)	$	(66	)

Items Included in Our Deferred Income Tax Assets (Liabilities)

DOLLAR AMOUNTS IN MILLIONS
	DECEMBER 31,  2024			DECEMBER 31, 2023
Deferred tax assets:
Pension and post-employment benefits	$	134		$	102
State tax credits		45			43
Depletion		13			13
Environmental reserves		17			16
Intra-entity transfers		32			18
Workers compensation		12			13
Net operating loss carryforwards		38			—
Other		83			99
Gross deferred tax assets		374			304
Valuation allowance		(68	)		(57	)
Net deferred tax assets		306			247
Deferred tax liabilities:
Property, plant and equipment		(290	)		(294	)
Other		(18	)		(19	)
Net deferred tax liabilities		(308	)		(313	)
Net deferred tax liability	$	(2	)	$	(66	)

Net Operating Loss and Credit Carryforwards

Our gross federal, state and foreign net operating loss carryforwards as of December 31, 2024 totaled $982 million as follows:

	Federal — U.S. REITs — $535 million, $185 million of the total will begin to expire in 2034; U.S. TRSs — $79 million that do not expire;
	State — $368 million, $317 million of the total will begin to expire in 2028 and
	Foreign — none currently recorded.

Our gross state credit carryforwards as of December 31, 2024 totaled $56 million, which includes $7 million that expire from 2025 through 2037. Our U.S. TRSs have $8 million in foreign tax credit carryforwards that expire from 2027 through 2031.

Valuation Allowances

With the exception of the valuation allowance discussed below, we believe it is more likely than not that we will have sufficient future taxable income to realize our deferred tax assets.

Our valuation allowance on our deferred tax assets was $68 million as of December 31, 2024, which related to state credits, state net operating losses and foreign tax credits.

UNRECOGNIZED TAX BENEFITS

Unrecognized tax benefits represent potential future obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. In accordance with our accounting policy, we accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense (see Note 1: Summary of Significant Accounting Policies). The total gross amount of unrecognized tax benefits as of December 31, 2024 and 2023, as well as the activity during those years, were immaterial.

As of December 31, 2024, none of our U.S. federal income tax returns or foreign jurisdiction income tax returns are under examination. Our U.S. federal income tax returns are open to examination for years 2021 forward and foreign jurisdiction income tax returns are open to examination for years 2017 forward. We are undergoing examinations in state jurisdictions for tax years 2020 through 2022, with tax years 2009 forward open to examination. We do not expect that the outcome of any examination will have a material effect on our consolidated financial statements; however, audit outcomes and the timing of audit settlements are subject to significant uncertainty.