Income Tax

12 Months Ended

Dec. 31, 2025

Income Tax Disclosure [Abstract]

Income Tax

14. Income Tax

The provision for income tax was as follows:

	Years Ended December 31,
	2025		2024		2023
	(In millions)
Current:
Federal	$	(48)	$	(39)	$	(5)
State and local	2		—		—
Subtotal	(46)		(39)		(5)
Deferred:
Federal	19		24		(378)
Provision for income tax expense (benefit)	$	(27)	$	(15)	$	(383)

The reconciliation of the income tax provision at the statutory tax rate to the provision for income tax as reported was as follows:

	Years Ended December 31,
	2025				2024				2023
	Amount (In millions)		Percent		Amount (In millions)		Percent		Amount (In millions)		Percent
Federal statutory tax rate	$	56	21	%	$	51	21	%	$	(316)	21	%
State and local income taxes, net of federal income tax effect (1)	2		1	%	—		—	%	—		—	%
Tax credits
Foreign tax credits	(31)		(12)	%	(26)		(11)	%	(2)		—	%
General business tax credits	—		—	%	—		—	%	(7)		1	%
Change in valuation allowance	—		—	%	—		—	%	(18)		1	%
Nontaxable or nondeductible items
Dividends received deduction	(32)		(12)	%	(37)		(14)	%	(36)		2	%
Tax advantaged investment income	(10)		(3)	%	(7)		(3)	%	(4)		—	%
Other	—		—	%	1		—	%	—		—	%
Change in unrecognized tax benefits	(2)		(1)	%	(12)		(5)	%	—		—	%
Other reconciling items
Adjustments to deferred tax	(10)		(4)	%	14		6	%	—		—	%
Other	—		—	%	1		—	%	—		—	%
Effective tax rate	$	(27)	(10)	%	$	(15)	(6)	%	$	(383)	25	%

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(1)State income taxes in Florida made up the majority (greater than 50%) of the tax effect in this category in 2025.

The income taxes paid (net of refunds) by jurisdiction for the years ended December 31, 2025, 2024, and 2023, as reported in the Consolidated Statements of Cash Flows, was as follows:

	Years Ended December 31,
	2025		2024		2023
Jurisdiction	(In millions)
U.S. Federal	$	(38)	$	(2)	$	—
Florida	2		1		—
Other Jurisdictions (1)	1		1		—
Total	$	(35)	$	—	$	—

_______________

(1)Includes all jurisdictions in which the amount of taxes paid does not meet the 5% disaggregation threshold.

Deferred income tax represents the tax effect of the differences between the book and tax bases of assets and liabilities. Net deferred income tax assets and liabilities consisted of the following at:

	December 31,
	2025		2024
	(In millions)
Deferred income tax assets:
Net unrealized investment losses	$	862	$	1,245
Net operating loss carryforwards	2,342		2,003
Investments, including derivatives	492		145
Tax credit carryforwards	160		188
Employee benefits	2		2
Intangibles	32		41
Other	—		4
Total deferred income tax assets	3,890		3,628
Less: Valuation allowance	—		—
Total net deferred income tax assets	3,890		3,628
Deferred income tax liabilities:
Policyholder liabilities and receivables	1,921		1,224
DAC	575		581
Other	5		—
Total deferred income tax liabilities	2,501		1,805
Net deferred income tax asset (liability)	$	1,389	$	1,823

The following table sets forth the net operating loss carryforwards for tax purposes at December 31, 2025.

	Net Operating Loss Carryforwards
	(In millions)
Expiration
2032	$	1,938
Indefinite	9,214
	$	11,152

The following table sets forth the general business credits and foreign tax credits available for carryforward for tax purposes at December 31, 2025.

	Tax Credit Carryforwards
	General Business Credits		Foreign Tax Credits
	(In millions)
Expiration
2028-2032	$	—	$	121
2033-2037	16		14
2038-2042	9		—
	$	25	$	135

A reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows:

	Years Ended December 31,
	2025		2024		2023
	(In millions)
Balance at January 1,	$	2	$	14	$	14
Additions for tax positions of prior years	—		—		—
Reductions for tax positions of prior years	—		—		—
Additions for tax positions of current year	—		—		—
Reductions for tax positions of current year	(2)		—		—
Settlements with tax authorities	—		—		—
Lapses of statutes of limitations	—		(12)		—
Balance at December 31,	$	—	$	2	$	14
Unrecognized tax benefits that, if recognized would impact the effective rate	$	—	$	2	$	14

The Company classifies interest accrued related to unrecognized tax benefits in interest expense, included in other expenses, while penalties are included in income tax expense. Interest related to unrecognized tax benefits was not significant. The Company had no penalties for each of the years ended December 31, 2025, 2024 and 2023.

The Company is subject to examination by the Internal Revenue Service and other tax authorities in jurisdictions in which the Company has significant business operations. The income tax years under examination vary by jurisdiction and subsidiary. The Company is no longer subject to federal, state or local income tax examinations for years prior to 2017.

Management believes it has established adequate tax liabilities, and final resolution of any examinations for the years 2017 and forward and any pending issues are not expected to have a material impact on the Company’s consolidated financial statements.

Tax Sharing Agreements

For the periods prior to the Separation, the Company filed a consolidated federal income tax return with MetLife, Inc. and its insurance and non-insurance subsidiaries. Current taxes (and the benefits of tax attributes such as losses) are allocated to the Company, and its includable subsidiaries, under a tax sharing agreement with MetLife, Inc. This tax sharing agreement states that federal taxes are computed on a modified separate return basis with benefits for losses.

For periods after the Separation through the year ended December 31, 2022, Brighthouse Life Insurance Company, BHNY and BRCD entered into a tax sharing agreement to join a consolidated federal income tax return. The tax sharing agreement states that federal taxes are computed on a modified separate return basis with benefit for losses. The non-insurance subsidiaries of the Company filed their own federal income tax returns.

For periods beginning with the year ended December 31, 2023, Brighthouse Life Insurance Company, BHNY and BRCD file a consolidated federal income tax return with Brighthouse Financial, Inc. and certain of its subsidiaries. In furtherance thereof, such parties joined a single tax sharing agreement, pursuant to which federal taxes are computed on a modified separate return basis with benefits for losses.

Income Tax Transactions with Former Parent

The Company entered into a tax separation agreement with MetLife (the “Tax Separation Agreement”). Among other things, the Tax Separation Agreement governs the allocation between MetLife and the Company of the responsibility for the taxes of the MetLife group. The Tax Separation Agreement also allocates rights, obligations and responsibilities in connection with certain administrative matters relating to the preparation of tax returns and control of tax audits and other proceedings relating to taxes. For the years ended December 31, 2025, 2024 and 2023, no payments were made by MetLife or Brighthouse Financial under the Tax Separation Agreement. At December 31, 2025 and 2024, there was a current income tax receivable of $18 million and $17 million, respectively, related to this agreement.