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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Redomiciliation Transaction

On November 20, 2024, the Redomiciliation Transaction was consummated resulting in a change in domicile for the Company from Luxembourg to the U.S. Following the Redomiciliation Transaction, the Company is subject to U.S. corporate income tax and will file consolidated income tax returns with its U.S. subsidiaries for its U.S. federal and various state government return obligations. The Redomiciliation Transaction resulted in the recognition of a U.S. deferred tax asset for deferred compensation, the removal of deferred taxes on undistributed U.S. earnings, and the removal of various Luxembourg deferred taxes and corresponding valuation allowance.
Income Tax Expense
The Company’s income tax benefit (expense) consisted of the following components (in thousands):
Year Ended December 31,
202420232022
Current:
Luxembourg$— $— $— 
U.S. Federal(36,605)(7,178)(13,561)
U.S. state and local(13,249)(1,485)(5,453)
Other foreign jurisdictions(8,745)(11,250)(3,455)
Total current(58,599)(19,913)(22,469)
Deferred:
U.S. Federal81,253 20,584 11,029 
U.S. state and local17,394 4,886 5,397 
Other foreign jurisdictions910 346 574 
Total deferred99,557 25,816 17,000 
Total income tax benefit (expense)$40,958 $5,903 $(5,469)
The Company’s (loss) income before income taxes consists of the following components (in thousands):
Year Ended December 31,
202420232022
Luxembourg$(244,594)$85,705 $81,308 
U.S.170,922 (61,995)9,063 
Other foreign jurisdictions26,809 37,873 6,856 
Total (loss) income before taxes$(46,863)$61,583 $97,227 
The total provision for income taxes can be reconciled to the tax computed at the Company’s statutory tax rate in the country of domicile (United States for 2024 and Luxembourg for 2023 and 2022) as follows:
Year Ended December 31,
202420232022
National statutory tax rate21.00 %24.94 %24.94 %
Increase/(reduction) in income tax rate:
U.S. state and local income taxes, net14.39 (6.35)(0.14)
Effect of rates different from statutory17.60 4.50 0.36 
Nondeductible officer compensation(5.19)0.04 1.59 
Tax on undistributed earnings22.53 3.55 3.73 
Section 250 deduction0.67 (0.59)(0.71)
Nontaxable gain/loss on earn-out liability— (2.48)(2.71)
Founders advisory fees29.48 (48.09)(30.09)
Tax rate changes0.67 (0.15)(0.94)
Changes in prior year estimates0.78 3.38 (1.95)
Write-off of deferred taxes in exited jurisdiction(57.72)— — 
Change in valuation allowance45.34 11.58 10.90 
Other, net(2.15)0.08 0.64 
Effective tax rate87.40 %(9.59)%5.62 %
Deferred Tax Assets and Liabilities
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting. Significant portions of the Company’s deferred tax assets and deferred tax liabilities are as follows (in thousands):
December 31, 2024December 31, 2023
Deferred Tax Assets:
Net operating loss carryforwards$1,684 $22,185 
Inventories59 487 
Interest118 7,263 
Accrued expenses and other current liabilities5,211 3,490 
Lease liabilities4,141 4,368 
Deferred compensation79,413 — 
Other5,598 4,538 
Valuation allowance(1,957)(23,315)
Total deferred tax assets94,267 19,016 
Deferred Tax Liabilities:
Property, plant and equipment(10,362)(10,560)
Goodwill and other intangibles(230,290)(245,359)
Undistributed earnings(1,183)(11,824)
Right-of-use assets(3,965)(4,211)
Other(370)(516)
Total deferred tax liabilities(246,170)(272,470)
Net deferred tax liability$(151,903)$(253,454)

As of December 31, 2024, the Company had no recognized net operating loss carryforwards in the U.S. and Luxembourg. The Company has other foreign net operating loss carryforwards of $6.7 million, of which, the majority can be carried forward indefinitely.
In assessing the realizability of deferred tax assets, the Company considers whether it is more-likely- than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. The Company considers the scheduled reversal of existing deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. While the Company expects to realize the remaining net deferred tax assets, changes in future taxable income or in tax laws may alter this expectation and result in future changes to the valuation allowance.
The valuation allowance for deferred tax assets as of December 31, 2024 and 2023 primarily relates to net operating loss and interest deduction limitation carryforwards that, in the judgment of the Company, are not more-likely-than-not to be realized. The change in valuation allowance for deferred tax assets for the year ending December 31, 2024 was a net decrease of $21.4 million.
As of December 31, 2024, the Company has provided deferred taxes of $1.2 million associated with withholding taxes on accumulated undistributed earnings generated by foreign subsidiaries. Earnings of countries within the European Union would be subject to zero withholding tax on future distributions of unremitted earnings. The Company continues to assert permanent reinvestment of the remaining undistributed earnings for which deferred taxes have not been provided for as of December 31, 2024. The computation of the potential deferred tax liability associated with these undistributed earnings is not practicable. If there are policy changes, the Company would record the applicable taxes in the period of change.
Uncertain Tax Benefits
The Company evaluates its tax positions and recognizes only tax benefits that, more likely than not, will be sustained upon examination, including resolution of any related appeals or litigation processes, based on the technical merits of the position. The tax position is measured at the largest amount of benefit that has a greater than 50.0% likelihood of being realized upon settlement. As of December 31, 2024 and 2023 the Company had $23.2 million of uncertain tax positions that, if recognized, would not affect the effective tax rate. As of December 31, 2024 and 2023, the Company had no accrued interest or penalties related to uncertain tax positions and no amounts had been recognized in the consolidated statement of operations and comprehensive income (loss).
The following table summarizes the activity related to the Company’s unrecognized tax benefits (in thousands):
20242023
Balance at beginning of year$23,245 $36,257 
Increase in prior years’ tax positions— 20,572 
Decrease in prior years’ tax positions— (33,584)
Balance at end of year$23,245 $23,245 
The Company files income tax returns in Luxembourg, U.S. federal and state jurisdictions, and other foreign jurisdictions. As of December 31, 2024, tax years 2021 through 2023 are subject to examination by the tax authorities in the U.S.