Income Taxes

3 Months Ended

Mar. 31, 2025

Income Taxes [Abstract]

Income Taxes

Income Taxes

Our effective tax rate for the three months ended March 31, 2025 increased period-over-period to 28.5% from 25.7%, due primarily to the non-deductibility of acquisition related costs related to the pending merger with IPG (see Note 1 to the unaudited consolidated financial statements). The effective tax rate for the three months ended March 31, 2024 includes the favorable impact from the resolution of certain non-U.S. tax positions of $7.5 million.

Numerous foreign jurisdictions have enacted legislation to adopt a minimum effective tax rate described in the Global Anti-Base Erosion, or Pillar Two, model rules issued by the Organization for Economic Co-operation and Development, or OECD. Under such rules, a minimum effective tax rate of 15% applies to multinational companies with consolidated revenue above €750 million.

Under the Pillar Two rules, a company is required to determine a combined effective tax rate for all entities located in a jurisdiction. If the jurisdictional effective tax rate determined under the Pillar Two rules is less than 15%, a top-up tax will be due to bring the jurisdictional effective tax rate up to 15%. We are continuing to monitor Pillar Two legislative developments and the effects of Pillar Two on our business. The provisions effective in 2025 do not have a materially adverse impact on our results of operations, financial position, or cash flows.

At March 31, 2025, our unrecognized tax benefits were $177.9 million. Of this amount, approximately $171.6 million would affect our effective tax rate upon resolution of the uncertain tax positions.