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Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
AB, a private limited partnership, is not subject to federal or state corporate income taxes. However, AB is subject to a 4.0% New York City Unincorporated Business Tax (“UBT”). Our domestic corporate subsidiaries are subject to federal, state and local income taxes, and generally are included in the filing of a consolidated federal income tax return. Separate state and local income tax returns also are filed. Foreign corporate subsidiaries generally are subject to taxes in the jurisdictions where they are located.
In order to preserve AB’s status as a private partnership for federal income tax purposes, AB Units must not be considered publicly traded. The AB Partnership Agreement provides that all transfers of AB Units must be approved by EQH and the General Partner. EQH and the General Partner approve only those transfers permitted pursuant to one or more of the safe harbors contained in the relevant U.S. Treasury regulations. If AB Units were considered readily tradable, AB’s net income would be subject to federal and state corporate income tax, significantly reducing its quarterly distribution to AB Holding. Furthermore, should AB enter into a substantial new line of business, AB Holding, by virtue of its ownership of AB, would lose its status as a publicly traded partnership and would become subject to corporate income tax, which would reduce materially AB Holding’s net income and its quarterly distributions to AB Holding Unitholders.
Earnings before income taxes and income tax expense consist of:
Years Ended December 31
202520242023
(in thousands)
Earnings before income taxes:
United States$881,162 $1,075,305 $714,732 
Foreign169,313 183,323 102,938 
Total$1,050,475 $1,258,628 $817,670 
Income tax expense:
Partnership UBT$6,125 $12,458 $7,838 
Corporate subsidiaries:
Federal1,717 899 2,855 
State and local951 1,345 914 
Foreign50,755 51,764 35,906 
Current tax expense59,548 66,466 47,513 
Deferred tax 2,052 (1,323)(18,462)
Income tax expense$61,600 $65,143 $29,051 
The table below provides the updated requirements of the Improvements to Income Tax Disclosures effective January 1, 2025. See Note 2 Summary of Significant Accounting Policies—Recent Accounting Pronouncements for additional details on the adoption of the Improvements to Income Tax Disclosures.
The Improvements to Income Tax Disclosures require reconciliation to the applicable statutory federal (national) income tax rate of the jurisdiction of domicile. Beginning 2025, AB updated the rate reconciliation to start with a zero percent federal income tax rate. The rate reconciliation discloses material reconciling items and foreign jurisdictions based on significant transactions, events, or jurisdictions separately disclosed elsewhere in the financial statements.
The principal reasons for the difference between the effective tax rates and the statutory federal income tax rate are as follows:
Year Ended December 31
2025
(in thousands)
U.S. Federal Statutory Tax Rate$— —%
State and local income tax (1)
9,411 0.9 
Corporate subsidiaries' federal tax effects2,013 0.2 
Foreign tax effects:
    United Kingdom
        Statutory tax rate differential19,203 1.8 
        Other(109)— 
    Luxembourg
        Statutory tax rate differential7,397 0.7 
        Other8 — 
    Other foreign jurisdictions23,677 2.3 
Income tax expense and effective tax rate$61,600 5.9%
(1)New York City UBT and Connecticut state taxes made up the majority (greater than 50%) of the tax effect in this category.
For the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the principal reasons for the difference between the effective tax rates and the UBT statutory tax rate of 4.0% are as follows:
Years Ended December 31
20242023
(in thousands)
UBT statutory rate$50,345 4.0%$32,707 4.0%
Corporate subsidiaries' federal, state, and local2,236 0.2 4,538 0.6 
Foreign subsidiaries taxed at different rates42,384 3.4 36,788 4.5 
FIN 48 reserve (release)— — (2,838)(0.3)
UBT business allocation percentage rate change(634)(0.1)(1,049)(0.1)
Deferred tax and payable write-offs911 0.1 1,750 0.2 
Foreign outside basis difference126 — 3,414 0.4 
Valuation allowance reserve (release)(16)— (22,447)(2.7)
Effect of ASC 740 adjustments, miscellaneous taxes, and other3,474 0.3 3,553 0.4 
Tax Credits(29)— (1,604)(0.2)
Income not taxable resulting from use of UBT business apportionment factors and effect of compensation charge(33,654)(2.7)(25,761)(3.2)
Income tax expense and effective tax rate$65,143 5.2%$29,051 3.6%
We recognize the effects of a tax position in the financial statements only if, as of the reporting date, it is “more likely than not” to be sustained based on its technical merits and its applicability to the facts and circumstances of the tax position. In making this assessment, we assume that the taxing authority will examine the tax position and have full knowledge of all relevant information.
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
Years Ended December 31
202520242023
(in thousands)
Balance as of beginning of period$— $— $2,838 
Additions for prior year tax positions— — — 
Reductions for prior year tax positions— — — 
Additions for current year tax positions— — — 
Reductions for current year tax positions— — — 
Reductions related to closed years/settlements with tax authorities— — (2,838)
Balance as of end of period$— $— $— 
Interest and penalties, if any, relating to tax positions are recorded in income tax expense on the consolidated statements of income. As of December 31, 2025, 2024, and 2023, there is no accrued interest or penalties recorded on the consolidated statements of financial condition.
Generally, the company is no longer subject to U.S. federal, state or local income tax examinations by tax authorities for any year prior to 2021, except as set forth below.
During the third quarter of 2023, the City of New York notified us of an examination of AB's UBT returns for the years 2020 through 2021. The examination is ongoing and no provision with respect to this examination has been recorded.
Currently, there are no income tax examinations at our significant non-U.S. subsidiaries. Years that remain open and may be subject to examination vary under local law and range from one to seven years.
Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The tax effect of significant items comprising the net deferred tax asset (liability) is as follows:
Years Ended December 31
20252024
(in thousands)
Deferred tax asset:
Differences between book and tax basis:
Benefits from net operating loss carryforwards$17,722 $14,242 
Long-term incentive compensation plans12,645 11,295 
Investment basis differences10,369 12,977 
Depreciation and amortization4,914 3,647 
Lease liability4,906 5,940 
Capital loss carryforward33,843 34,069 
Tax credits carryforward4,986 5,300 
Other, primarily accrued expenses deductible when paid6,840 9,181 
96,225 96,651 
Less: valuation allowance(29,681)(25,996)
Deferred tax asset66,544 70,655 
Deferred tax liability:  
Differences between book and tax basis:  
Intangible assets10,033 12,254 
Investment in foreign subsidiaries6,534 5,697 
Right-of-use asset4,307 5,168 
Other3,304 2,485 
Deferred tax liability24,178 25,604 
Net deferred tax asset$42,366 $45,051 
Valuation allowances of $29.7 million and $26.0 million were established as of December 31, 2025 and 2024, respectively, primarily due to significant negative evidence that net operating loss ("NOL") carryforwards will not be utilized given the future losses expected to be incurred by the applicable subsidiaries and due to significant negative evidence that capital losses generated in the sale of foreign subsidiaries will not be utilized given the nature of income expected to be incurred by the applicable subsidiaries. We had net operating loss carryforwards at December 31, 2025 and 2024 of approximately $68.5 million and $56.7 million, respectively, in certain foreign locations with a five year expiration period. The capital loss carryforward has a five year expiration period.
The deferred tax asset is included in other assets in our consolidated statement of financial condition. Management believes there will be sufficient future taxable income to realize the tax benefits related to the remaining net deferred tax assets recognized that are not subject to valuation allowances.
The company provides income taxes on the unremitted earnings of non-U.S. corporate subsidiaries except to the extent that such earnings are indefinitely reinvested outside the United States. As of December 31, 2025, the company did not record income taxes on undistributed earnings on some foreign subsidiaries because those earnings were indefinitely reinvested in the operation of those subsidiaries. If such earnings were to be distributed, the company would be subject to additional foreign withholding taxes and other tax consequences. At existing applicable income tax rates, additional taxes of approximately $6.2 million would need to be paid if such earnings are remitted.
 
Upon adoption of the amendments under Improvements to Income Tax Disclosures applied for the year ended December 31, 2025, cash paid (net of refunds received) for income taxes consisted of the following:
Year Ended December 31
2025
Domestic:(in thousands)
  NYC UBT$7,654 
  Other state & local6,145 
  Federal tax on partnership gross business income6,741 
20,540 
Foreign:
UK15,762 
Denmark5,921 
Luxembourg9,727 
Other16,725 
48,135 
Total cash paid for income taxes (net of refunds)$68,675 
Total cash paid for income taxes for the years ended December 31, 2024 and 2023 prior to the adoption of ASU 2023-09 consisted of the following:
Years Ended December 31
20242023
Total cash paid for income taxes (prior to the adoption of ASU 2023-09)$51,799 $57,216