Company: IHETW
Filing Date: 2025-11-10
Form Type: 10-Q
Source: 0001628280-25-051036
Chunk: 76

Company: iHeartMedia, Inc.
Filing Date: 2025-11-10
Form: 10-Q
Item: Item 8
Chunk 76
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 and spending reform law known as the One Big Beautiful Bill Act ("OBBBA"), which builds upon and expands the provisions of the 2017 Tax Cuts and Jobs Act and introduces significant changes to the U.S. federal income tax system, effective beginning with the 2025 calendar year. Key provisions of the legislation include the restoration of 100% bonus depreciation, immediate expensing of domestic research and development costs under a new Section 174A, and the reinstatement of the EBITDA-based limitation for the deductibility of business interest under Section 163(j). These provisions were made permanent by the OBBBA.The Company has recorded the impacts of the new OBBBA tax provisions in its financial statements for the period ended September 30, 2025. The primary impacts of the legislation were increased tax amortization, depreciation, research and development expenses, and interest deductions in 2025. As a result of these increased tax deductions, the Company now expects a reduction in its tax payments in current and future years. Additionally, the Company recorded a reduction in its valuation allowance against certain deferred tax assets for the effects of the OBBBA tax provisions in the current period. The income tax benefit associated with the change in valuation allowance increased the Company's effective tax rate as described below.  The Company’s income tax benefit (expense) consisted of the following components:(In thousands)Three Months EndedSeptember 30,Nine Months EndedSeptember 30,2025202420252024Current tax benefit (expense)$4,014 $(23,066)$(6,999)$(43,453)Deferred tax benefit161,595 2,231 18,996 67,239 Income tax benefit (expense)$165,609 $(20,835)$11,997 $23,786 

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IHEARTMEDIA, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(UNAUDITED)

The effective tax rates for the three months ended September 30, 2025 and 2024 were 71.6% and (101.7)%, respectively. The three month effective tax rate for the period ended September 30, 2025 was primarily impacted by the reduction in valuation allowances recorded during the period due to the enactment of the OBBBA tax provision. This impact was offset by an increase in valuation allowance recorded against certain deferred tax assets arising in the current year, related primarily to disallowed interest expense carryforwards due to uncertainty