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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
Operating Loss Carryforwards [Line Items]  
INCOME TAXES
11. INCOME TAXES:
 
The provision (benefit) for income taxes consisted of the following for the years ended December 31, 2024, 2023, and 2022 (in millions):
 202420232022
Current (benefit) provision for income taxes:   
Federal$(10)$5 $6 
State4 (5)3 
 (6)— 9 
Deferred provision (benefit) for income taxes:   
Federal86 (342)868 
State(4)(16)36 
 82 (358)904 
Provision (benefit) for income taxes$76 $(358)$913 
The following is a reconciliation of federal income taxes at the applicable statutory rate to the recorded provision:
 202420232022
Federal statutory rate21.0 %21.0 %21.0 %
Adjustments:   
State income taxes, net of federal tax benefit (a)5.1 %4.6 %2.0 %
Valuation allowance (b)(4.9)%30.6 %1.6 %
Pending tax refunds interest income (c)(3.4)%— %— %
Federal tax credits(1.5)%0.6 %(0.2)%
Other2.8 %(0.5)%0.9 %
Effective income tax rate19.1 %56.3 %25.3 %
(a)Included in state income taxes are deferred income tax effects related to certain acquisitions, intercompany mergers, tax elections, law changes and/or impact of changes in apportionment.
(b)Our 2024 income tax provision includes a $19 million decrease in valuation allowance primarily as a result of a change in recent years from cumulative loss to cumulative earnings in certain state jurisdictions, and a remeasurement of state net deferred tax assets due to state apportionment updates. Our 2023 income tax provision includes a $212 million decrease related to the release of valuation allowance associated with the federal interest expense carryforwards under the IRC Section 163(j). Our 2022 income tax provision includes a net $56 million addition related to an increase in valuation allowance associated with the federal interest expense carryforwards under the IRC Section 163(j) and primarily offset by a decrease in valuation allowance on certain state deferred tax assets resulting from the Deconsolidation.
(c)Our 2024 income tax provision includes a $14 million accrual of interest income attributable to prior years’ pending income tax refund claims, including an immaterial $7.5 million correcting adjustment related to the accrual of interest income attributable to prior years’ pending income tax refund claims.

Temporary differences between the financial reporting carrying amounts and the tax bases of assets and liabilities give rise to deferred taxes. Total deferred tax assets and deferred tax liabilities as of December 31, 2024 and 2023 were as follows (in millions):
 20242023
Deferred Tax Assets:  
Net operating losses:  
Federal$86 $111 
State149 151 
IRC Section 163(j) interest expense carryforward139 93 
Tax Credits91 87 
Investment in Bally's securities62 83 
Capitalized research and development expenses52 38 
Other80 80 
 659 643 
Valuation allowance for deferred tax assets(101)(120)
Total deferred tax assets$558 $523 
Deferred Tax Liabilities:  
Goodwill and intangible assets$(360)$(367)
Property & equipment, net(93)(104)
Investment in DSIH(405)(250)
Other(35)(54)
Total deferred tax liabilities(893)(775)
Net deferred tax liabilities$(335)$(252)
At December 31, 2024, the Company had approximately $411 million and $3,377 million of gross federal and state net operating losses, respectively. Except for those without an expiration date, these losses will expire during various years from 2025 to 2044, and some of them are subject to annual limitations under the IRC Section 382 and similar state provisions. As discussed in Income Taxes within Note 1. Nature of Operations and Summary of Significant Accounting Policies, we establish a valuation allowance in accordance with the guidance related to accounting for income taxes. As of December 31, 2024, a valuation allowance has been provided for deferred tax assets related to certain temporary basis differences and a substantial portion of our available state net operating loss carryforwards based on past operating results, expected timing of the reversals of existing temporary basis differences, alternative tax strategies, current and cumulative losses, and projected future taxable income. Although realization is not assured for the remaining deferred tax assets, we believe it is more likely than not that they will be realized in the future. During the year ended December 31, 2024, we decreased our valuation allowance by $19 million to $101 million. The decrease was primarily a result of a change in recent years from cumulative loss to cumulative earnings in certain state jurisdictions, and a remeasurement of state net deferred tax assets due to state apportionment updates. During the year ended December 31, 2023, we decreased our valuation allowance by $192 million to $120 million. The decrease was primarily due to the release of valuation allowance related to interest expense carryforwards under the IRC Section 163(j) offset by a change in judgment in the realizability of certain state deferred tax assets.
 
Due to DSG’s emergence from bankruptcy in early 2025, we expect to record a gain upon disposition for tax purposes. This will result in a material tax payment and movement to certain deferred tax assets and liabilities, primarily those related to investment in DSIH, net operating losses, and tax credits.

The following table summarizes the activity related to our accrued unrecognized tax benefits (in millions):
 202420232022
Balance at January 1,$14 $17 $15 
Additions related to prior year tax positions— — 2 
Additions related to current year tax positions1 1 1 
Reductions related to settlements with taxing authorities— (2)— 
Reductions related to expiration of the applicable statute of limitations— (2)(1)
Balance at December 31,$15 $14 $17 

We are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. Our 2014 through 2020 federal tax returns are currently under audit, and several of our subsidiaries are currently under state examinations for various years. We do not anticipate that resolution of these matters will result in a material change to our consolidated financial statements. In addition, we do not believe that our liability for unrecognized tax benefits would be materially impacted, in the next twelve months, as a result of expected statute of limitations expirations and resolution of examination issues and settlements with tax authorities.
Sinclair Broadcast Group, LLC  
Operating Loss Carryforwards [Line Items]  
INCOME TAXES
10. INCOME TAXES:

The provision (benefit) for income taxes consisted of the following for the years ended December 31, 2024, 2023, and 2022
(in millions):
 202420232022
Current (benefit) provision for income taxes:   
Federal$(35)$5 $6 
State4 (5)3 
 (31)— 9 
Deferred provision (benefit) for income taxes:
Federal95 (331)868 
State(4)(28)36 
 91 (359)904 
Provision (benefit) for income taxes$60 $(359)$913 

The following is a reconciliation of federal income taxes at the applicable statutory rate to the recorded provision:
 202420232022
Federal statutory rate21.0 %21.0 %21.0 %
Adjustments:
State income taxes, net of federal tax benefit (a)6.0 %4.7 %2.0 %
Valuation allowance (b)(5.8)%33.5 %1.6 %
Pending tax refunds interest income (c)(4.6)%— %— %
Non-deductible items1.9 %(0.6)%— %
Federal tax credits(1.9)%0.6 %(0.2)%
Adjustment to prior year taxes1.7 %— %— %
Other2.0 %0.2 %0.9 %
Effective income tax rate20.3 %59.4 %25.3 %
(a)Included in state income taxes are deferred income tax effects related to certain acquisitions, intercompany mergers, tax elections, law changes and/or impact of changes in apportionment.
(b)SBG’s 2024 income tax provision includes a $17 million decrease in valuation allowance primarily result of a change in recent years from cumulative loss to cumulative earnings in certain state jurisdictions, and a remeasurement of state net deferred tax assets due to state apportionment updates. SBG’s 2023 income tax provision includes a $212 million decrease related to the release of valuation allowance associated with the federal interest expense carryforwards under the IRC Section 163(j). SBG’s 2022 income tax provision includes a net $56 million addition related to an increase in valuation allowance associated with the federal interest expense carryforwards under the IRC Section 163(j) and primarily offset by a decrease in valuation allowance on certain state deferred tax assets resulting from the Deconsolidation.
(c)SBG’s 2024 income tax provision includes a $14 million accrual of interest income attributable to prior years’ pending income tax refund claims, including an immaterial $7.5 million correcting adjustment related to the accrual of interest income attributable to prior years’ pending income tax refund claims.
Temporary differences between the financial reporting carrying amounts and the tax bases of assets and liabilities give rise to deferred taxes. Total deferred tax assets and deferred tax liabilities as of December 31, 2024 and 2023 were as follows (in millions):
 20242023
Deferred Tax Assets:
Net operating losses:
Federal$75 $97 
State149 152 
IRC Section 163(j) interest expense carryforward139 93 
Tax Credits90 87 
Capitalized research and development expenses44 35 
Other81 83 
578 547 
Valuation allowance for deferred tax assets(96)(113)
Total deferred tax assets$482 $434 
Deferred Tax Liabilities:
Goodwill and intangible assets$(331)$(334)
Property & equipment, net(87)(98)
Investment in DSIH(405)(250)
Other(32)(35)
Total deferred tax liabilities(855)(717)
Net deferred tax liabilities$(373)$(283)

At December 31, 2024, SBG had approximately $358 million and $3,366 million of gross federal and state net operating losses, respectively. Except for those without an expiration date, these losses will expire during various years from 2025 to 2044, and some of them are subject to annual limitations under the IRC Section 382 and similar state provisions. As discussed in Income Taxes under Note 1. Nature of Operations and Summary of Significant Accounting Policies, SBG establishes a valuation allowance in accordance with the guidance related to accounting for income taxes. As of December 31, 2024, a valuation allowance has been provided for deferred tax assets related to certain temporary basis differences and a substantial portion of SBG’s available state net operating loss carryforwards based on past operating results, expected timing of the reversals of existing temporary basis differences, alternative tax strategies, current and cumulative losses, and projected future taxable income. Although realization is not assured for the remaining deferred tax assets, SBG believes it is more likely than not that they will be realized in the future. During the year ended December 31, 2024, SBG decreased its valuation allowance by $17 million to $96 million. The decrease was primarily a result of a change in recent years from cumulative loss to cumulative earnings in certain state jurisdictions, and a remeasurement of state net deferred tax assets due to state apportionment updates. During the year ended December 31, 2023, SBG decreased its valuation allowance by $199 million to $113 million. The decrease was primarily due to the release of valuation allowance related to interest expense carryforwards under the IRC Section 163(j) offset by a change in judgment in the realizability of certain state deferred tax assets.

Due to DSG’s emergence from bankruptcy in early 2025, SBG expects to record a gain upon disposition for tax purposes. This will result in a material tax payment and movement to certain deferred tax assets and liabilities, primarily those related to investment in DSIH, net operating losses, and tax credits.
 
The following table summarizes the activity related to SBG’s accrued unrecognized tax benefits (in millions):
 202420232022
Balance at January 1,$12 $17 $15 
Additions related to prior year tax positions— — 2 
Additions related to current year tax positions1 1 1 
Reductions related to positions transferred to Ventures— (2)— 
Reductions related to settlements with taxing authorities— (2)— 
Reductions related to expiration of the applicable statute of limitations— (2)(1)
Balance at December 31,$13 $12 $17 

As of 2023, SBG is a subsidiary of Sinclair and is subject to U.S. federal income tax as part of the consolidated return. SBG is also subject to income tax of multiple state jurisdictions. SBG’s 2014 through 2020 federal tax returns are currently under audit, and several of SBG’s subsidiaries are currently under state examinations for various years. SBG does not anticipate that resolution of these matters will result in a material change to SBG’s financial statements. In addition, SBG does not believe that SBG’s liability for unrecognized tax benefits would be materially impacted, in the next twelve months, as a result of expected statute of limitations expirations and resolution of examination issues and settlements with tax authorities.