Company: IHETW
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001400891-25-000009
Chunk: 155

Company: iHeartMedia, Inc.
Filing Date: 2025-02-27
Form: 10-K
Item: Item 8
Chunk 155
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; employment and benefits related claims; governmental fines; intellectual property claims; and tax disputes.Alien Ownership Restrictions and FCC Declaratory Ruling

The Communications Act and FCC regulation prohibit foreign entities and individuals from having direct or indirect ownership or voting rights of more than 25 percent in a corporation controlling the licensee of a radio broadcast station unless the FCC finds greater foreign ownership to be in the public interest. On November 5, 2020, the FCC issued a declaratory ruling, permitting the Company to be up to 100% foreign-owned, subject to certain conditions (the “2020 Declaratory Ruling”).  

NOTE 8 – INCOME TAXES

On December 20, 2024, the company closed on a debt exchange transaction that is discussed in detail in Note 6, Long-Term Debt. In connection with the debt exchange transaction the Company recognized cancellation of debt income (“CODI”) for US tax purposes of $744.7 million. Pursuant to Internal Revenue Code (“IRC”) Section 108, an insolvent debtor may exclude CODI from taxable income to the extent of the debtor’s insolvency (liabilities greater than the fair value of its assets) but must reduce its tax attributes, subject to certain limitations and according to prescribed ordering rules, based on the amount of CODI excluded from taxable income. The company currently estimates that the level of its insolvency (as defined for US Tax purposes) exceeds the amount of CODI resulting from the debt exchange transactions, such that all of the resulting CODI will be excluded from the company’s taxable income.For purposes of determining the tax provision for the year ended December 31, 2024, the company estimates that $744.7 million of its federal capital loss carryforwards and certain of its states net operating loss and capital loss carryforwards will be eliminated as a result of tax attribute reduction for excluded CODI. For the year ended December 31, 2024, the company recorded an income tax benefit of $118.2 million related to the net effects of the debt exchange transaction, including excluded CODI, federal and state tax attribute reduction, and resulting changes in valuation allowance. Pillar Two – Global Minimum TaxThe Organization for Economic Co-operation and Development has published model rules, which include the implementation of a global minimum tax rate of 15%, commonly referred to as Pillar Two. Certain countries in which we operate have enacted legislation implementing the Pillar Two model rules, effective January 1, 2024. The