Company: NGVT
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001653477-25-000127
Chunk: 104

Company: Ingevity Corp
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 8
Chunk 104
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 information.(2) See Note 4 for further information. (3) See Note 7 for further information. (4) See Note 14 for further information. (5) Increase in EAETR for the three and nine months ended September 30, 2025, as compared to September 30, 2024, primarily reflects a shift in the projected mix of earnings across jurisdictions with varying tax rates, most notably in the U.S. Additionally, the foreign-derived intangible income deduction decreased significantly in 2025 compared to 2024 as a result of the One Big Beautiful Bill Act (OBBB) signed into law on July 4, 2025, which allowed immediate deductibility of previously amortizable expenses. At September 30, 2025 and December 31, 2024, we had deferred tax assets of $12.1 million and $11.0 million, respectively, resulting from certain historical net operating losses from our Brazil and U.S. state tax credits for which a valuation allowance has been established. The ultimate realization of these deferred tax assets depends on the generation of future taxable income during the periods in which these net operating losses and tax credits are available to be used. In evaluating the realizability of these deferred tax assets, we consider projected future taxable income and tax planning strategies in making our assessment. As of September 30, 2025, we cannot objectively assert that these deferred tax assets are more likely than not to be realized and therefore we have maintained a valuation allowance. We intend to continue maintaining a valuation 

24

INGEVITY CORPORATIONNotes to the Condensed Consolidated Financial StatementsSeptember 30, 2025(Unaudited)

allowance on these deferred tax assets until there is sufficient evidence to support the reversal of all or some portion of these allowances. A release of all or a portion of the valuation allowance could be possible if we determine that sufficient positive evidence becomes available to allow us to reach a conclusion that the valuation allowance will no longer be needed. A release of the valuation allowance would result in the recognition of certain deferred tax assets and a reduction to income tax expense for the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change based on the level of profitability that we are able to actually achieve.On July 4, 2025, the President signed into law the One Big Beautiful Bill ("OBBB") Act, a comprehensive tax reform package that significantly modifies U.S. federal tax policy. Based on the