Company: BLCO
Filing Date: 2025-07-30
Form Type: 10-Q
Source: 0001860742-25-000018
Chunk: 37

Company: Bausch & Lomb Corp
Filing Date: 2025-07-30
Form: 10-Q
Item: Item 8
Chunk 37
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 (a) a benefit for previously accrued taxes that settled favorably with the Internal Revenue Service (b) the impact of the voluntary recall of certain enVista IOL products, (c) the filing of certain tax returns and (d) a change in the deduction for stock compensation. Provision for income taxes for the six months ended June 30, 2024 was $145 million. The difference between the statutory tax rate and the effective tax rate was primarily attributable to jurisdictional mix of earnings and the discrete tax effects of: (a) the filing of certain tax returns, (b) a change in the deduction for stock compensation and (c) the release of uncertain tax positions where the statute of limitations in certain jurisdictions lapsed.The Company records a valuation allowance against its deferred tax assets to reduce the net carrying value to an amount that it believes is more likely than not to be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, the provision for income taxes will increase or decrease, respectively, in the period such determination is made. The valuation allowance against deferred tax assets was $204 million and $179 million as of June 30, 2025 and December 31, 2024, respectively. The increase is related to the losses incurred during the six months ended June 30, 2025 in jurisdictions for which the Company has established a full valuation allowance offset partially by movement in deferred taxes due to realized gain on loan settlements.The Company’s U.S. affiliates remain under examination for various state tax audits in the U.S. for years 2017 through 2023.The Company’s subsidiaries in Germany are under audit for tax years 2017 through 2019. During the three months ended September 30, 2023, the Company received a preliminary assessment from the German taxing authority for the 2014 through 2016 period that would disallow certain transfer pricing adjustments. The Company contested this alleged tax deficiency through the appropriate appeals process and reached a preliminary settlement with the German taxing authority during the year ended December 31, 2024. The settlement was then finalized with the taxing authority and resulted in an immaterial tax 

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cost that will close out the 2014 to 2016 audit period. The Company continues to believe this liability will be indemnified by BHC pursuant to the Tax Matters Agreement.As of June 30, 2025 and December 31, 2024, the Company had $72 million and $64 million of unrecognized tax