Income Taxes (Notes)

6 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Income taxes

INCOME TAXES

Prior to the Spin-off, Old BellRing held an economic interest in BellRing LLC (see Note 1) which, as a result of the IPO and formation transactions, was treated as a partnership for U.S. federal income tax purposes. As a partnership, BellRing LLC itself was generally not subject to U.S. federal income tax under current U.S. tax laws. Generally, items of taxable income, gain, loss and deduction of BellRing LLC were passed through to its members, Old BellRing and Post. Old BellRing was responsible for its share of taxable income or loss of BellRing LLC allocated to it in accordance with the BellRing LLC Agreement and partnership tax rules and regulations.

Subsequent to the Spin-off, the Company reported 100% of the income, gain, loss and deduction of BellRing LLC for U.S. federal, state, and local income tax purposes.

The effective income tax rate was 45.1% and 12.4% for the three and six months ended March 31, 2022, respectively, and 10.7% and 6.3% for the three and six months ended March 31, 2021, respectively. The increase in the effective income tax rate compared to the prior periods was primarily due to (i) certain separation-related expenses incurred in connection with the Spin-off that were treated as non-deductible and (ii) the Company reporting 100% of the income, gain, loss and deduction of BellRing LLC in the periods subsequent to the Spin-off.

For additional information on the Tax Matters Agreement by and among Post, BellRing and Old BellRing, see Note 4.