Company: CL
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000021665-25-000008
Chunk: 46

Company: COLGATE PALMOLIVE CO
Filing Date: 2025-02-13
Form: 10-K
Item: Item 16
Chunk 46
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2 respectively. The net tax expense or benefit in each year predominantly includes current and future tax impacts related to benefit plans and the impact of currency translation adjustments. The Company uses a comprehensive model to recognize, measure, present and disclose in its financial statements uncertain tax positions that the Company has taken or expects to take on an income tax return.

105

COLGATE-PALMOLIVE COMPANY Notes to Consolidated Financial Statements (continued)(Dollars in Millions Except Share and Per Share Amounts)

Unrecognized tax benefits activity for the years ended December 31, 2024, 2023 and 2022 is summarized below:  202420232022Unrecognized tax benefits:   Balance, January 1$314 $298 $245 Increases as a result of tax positions taken during the current year37 73 32 Decreases of tax positions taken during prior years(53)(61)(21)Increases of tax positions taken during prior years10 6 46 Decreases as a result of settlements with taxing authorities and the expiration of statutes of limitations(3)(2)(2)Effect of foreign currency rate movements(9)— (2)Balance, December 31$296 $314 $298 If all of the unrecognized tax benefits for 2024 above were recognized, approximately $286 would impact the effective tax rate. It is reasonably possible that the amount of unrecognized benefits with respect to our uncertain tax positions could change in the next twelve months and such change may or may not be material.The Company recognized expenses of approximately $22, $10 and $8 for interest and penalties related to the above unrecognized tax benefits within income tax expense in 2024, 2023 and 2022, respectively. The Company had accrued interest and penalties of approximately $68, $45 and $40 as of December 31, 2024, 2023 and 2022, respectively.In the third quarter of 2023, the Internal Revenue Service (the “IRS”) issued a notice giving taxpayers temporary relief from the effects of certain U.S. tax regulations that were issued in December 2021, which place greater restrictions on foreign taxes that are creditable against U.S. taxes on foreign-source income. This notice allowed taxpayers to defer the application of these new regulations through the end of 2023. In December 2023, the IRS issued further guidance modifying this temporary relief period to the date that a notice or other guidance withdrawing or modifying the temporary relief is issued