Company: KW
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0001408100-25-000084
Chunk: 196

Company: Kennedy-Wilson Holdings, Inc.
Filing Date: 2025-02-28
Form: 10-K
Item: Item 8
Chunk 196
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 asset for its investment in KWE.  As of December 31, 2018, the Company recorded a $98.3 million deferred tax asset related to its excess tax basis over book carrying value for its investment in KWE. As a significant portion of the excess tax basis would only reverse upon a strengthening of foreign currencies or upon a disposition of KWE, the Company determined that a valuation allowance of $98.3 million was required for the tax basis that was in excess of the Company’s carrying value for its investment in KWE as it did not meet the more likely than not recognition threshold.  During the years ended December 31, 2023, the Company's excess tax basis over book basis in KWE decreased due to unrealized foreign currency gains that has no 

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Table of ContentsKennedy-Wilson Holdings, Inc.Notes to Consolidated Financial Statements—(continued)December 31, 2024 2023 and 2022

tax basis.  During the year ended December 31, 2024, the Company's excess tax basis over book basis in KWE increased, primarily due to higher tax gains on sales of real estate.  As of December 31, 2024, Kennedy Wilson’s excess tax basis in KWE and the related valuation allowance were $89.1 million and $76.6 million, respectively.  As of December 31, 2024, Kennedy Wilson had California and other state net operating losses of $99.6 million and $10.1 million, respectively.  California net operating losses begin to expire in 2034.  As of December 31, 2024, Kennedy Wilson had $156.5 million of foreign net operating loss carryforwards, which have no expiration date. The Company has foreign tax credit carryforwards of $87.6 million, of which $6.3 million begin to expire in 2027.The Company's valuation allowance on deferred tax assets decreased by $5.8 million in 2024 and increased by $17.4 million in 2023.  The decrease in the valuation allowance during 2024 primarily relates to a partial release of the valuation allowance against the deferred tax asset associated with our excess tax basis in KWE investment relating to assets intended for sale in the foreseeable future.  The increase in the 2023 valuation allowance principally relates to additional valuation allowance recorded on the Company's UK Basis Step-Up deferred tax asset as a result of depreciation. In June 202