Company: GDOT
Filing Date: 2025-03-04
Form Type: 10-K
Source: 0001386278-25-000009
Chunk: 148

Company: GREEN DOT CORP
Filing Date: 2025-03-04
Form: 10-K
Item: Item 8
Chunk 148
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 IRC 162(m) limitation12.7 0.4 0.8 Change in valuation allowance(1.9)— — Other(1.0)1.5 0.1 Effective tax rate(18.5)%54.1 %23.5 %

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Table of ContentsGREEN DOT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (CONTINUED)

Note 14—Income Taxes (continued)The effective tax rate for the year ended December 31, 2024 and 2023 differs from the statutory federal income tax rate of 21%, primarily due to state income taxes, net of federal tax benefits, general business credits, stock-based compensation, nondeductible penalties, cash surrender value growth in bank owned life insurance policies, and the IRC 162(m) limitation on the deductibility of executive compensation. The net decrease in the effective tax rate for the year ended December 31, 2024 as compared to the prior year ended December 31, 2023 is primarily due to a decrease of $2.9 million in the amount of compensation expense subject to the IRC 162(m) limitation on the deductibility of certain executive compensation, a decrease of $0.8 million in state income tax expense, net of federal benefits, and the impact of general business credits. These decreases were partially offset by an increase of $2.9 million in the expense related to tax shortfalls from stock-based compensation, an increase of $0.8 million in the expense related to nondeductible penalties, an increase of $0.4 million in the valuation allowance on a portion of our unrealized loss on equity securities, and the surrender of our existing bank owned life insurance policies which resulted in a tax charge of $1.5 million and surrender penalties of $0.7 million. The increase in nondeductible penalties is primarily related to the tax effect associated with the civil money penalty for the Consent Order discussed in Note 21 - Commitments and Contingencies.We have made a policy election to account for Global Intangible Low-Taxed Income ("GILTI") in the year the GILTI tax is incurred. For the year ended December 31, 2024, the provision for GILTI tax expense was not material to our financial statements.The tax effects of temporary difference that give rise to significant portions of our deferred tax assets and liabilities were as follows:December 31,20242023(In