Company: HEI-A
Filing Date: 2025-12-22
Form Type: 10-K
Source: 0000046619-25-000082
Chunk: 117

Company: HEICO CORP
Filing Date: 2025-12-22
Form: 10-K
Item: Item 8
Chunk 117
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 subject to a lower tax rate.On July 4, 2025, the U.S. enacted H.R. 1, commonly referred to as the One Big Beautiful Bill Act (the “Act”), which introduced significant changes to U.S. tax law.  Key provisions include the reinstatement of 100% bonus depreciation for qualified property placed in service after January 19, 2025, immediate expensing of domestic R&D expenditures (effective in fiscal 2026 for HEICO), and changes to the methodology for Foreign-Derived Intangible Income (“FDII”) and Global Intangible Low-Tax Income ("GILTI") (effective in fiscal 2027 for HEICO).  The Act did not have a significant impact on the Company’s fiscal 2025 consolidated financial statements and the Company will continue to evaluate its potential impact on its future consolidated financial statements.As a result of the Tax Cuts and Jobs Act, the Company began capitalizing R&D costs beginning in fiscal 2023 and amortizing them over five years for income tax purposes.  In accordance with one of the provisions of the Act, the Company expects to immediately expense domestic R&D costs for income tax purposes beginning in fiscal 2026 and will elect to deduct the remaining unamortized domestic R&D costs that were capitalized over a two-year period ending in fiscal 2027.    The Company files income tax returns in the U.S. federal jurisdiction and in multiple state jurisdictions.  The Company is also subject to income taxes in certain jurisdictions outside the U.S., none of which are individually material to the accompanying consolidated financial statements.  Generally, the Company is no longer subject to U.S. federal, state or foreign examinations by tax authorities for years prior to fiscal 2021.  One of the Company's foreign subsidiaries files income tax returns in The Netherlands and Thailand where the statute of limitations is open for its fiscal 2015 returns.    Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  The Company believes that it is more likely than not that it will 

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generate sufficient future taxable income to utilize all of its deferred tax assets and has therefore not recorded a valuation allowance on any such asset.Significant components of the Company’s deferred tax assets and liabilities are as follows (in thousands):As of October 31,20252024Deferred tax assets:Inventories$107,395 $92,498