Company: BCO
Filing Date: 2025-02-26
Form Type: 10-K
Source: 0000078890-25-000059
Chunk: 251

Company: BRINKS CO
Filing Date: 2025-02-26
Form: 10-K
Item: Item 7
Chunk 251
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 that a notice or other guidance withdrawing or modifying the temporary relief is issued (or any later date specified in such notice or other guidance). We determined a significant amount of the post-2021 foreign withholding taxes will now be eligible for U.S. foreign income tax credit treatment and therefore our U.S. operations will annually be generating new foreign tax credits which should be creditable in the year generated. As a result, we no longer expect to be able to utilize a substantial amount of our foreign tax credit carryforwards to offset future tax prior to their expiration.

Additionally, we concluded that we were more-likely-than-not to realize certain state deferred tax assets, and as a result we recorded a $4 million valuation allowance benefit through income from continuing operations. 

In 2022, we concluded that we were more-likely-than-not to realize assets related to certain attributes with a limited statutory carryforward and we recorded a $56 million valuation allowance benefit through income from continuing operations and an additional $14 million valuation allowance reduction through other comprehensive income (loss). Our conclusion was based upon the final foreign tax credit regulations that the U.S. Treasury published in the Federal Register on January 4, 2022. We determined a significant amount of the post-2021 foreign withholding taxes will now be ineligible for U.S. foreign income tax credit treatment and therefore our U.S. operations will no longer annually be generating new foreign tax credits in excess of its annual foreign tax credit utilization limit. As a result, we expect to be able to utilize a substantial amount of our foreign tax credit and general business tax credit carryforwards to offset future tax prior to their expiration. 

We used various estimates and assumptions to evaluate the need for the valuation allowance in the U.S. These included

50

•projected revenues and operating income for our U.S. entities,

•projected royalties and management fees paid to U.S. entities from subsidiaries outside the U.S.,

•projected Global Intangible Low-Taxed Income ("GILTI") inclusion in our U.S. taxable income,

•estimated required contributions to our U.S. retirement plans, 

•the estimated impact of U.S. tax reform and other U.S. tax legislation, and

•interest rates on projected U.S. borrowings.

Our projections assumed continued growth of our revenues and operating profit both in the U.S. and outside the U.S. Had we used different assumptions, we might have made different conclusions about the need for valuation allowances. For example, if we did