Company: LGN
Filing Date: 2025-12-09
Form Type: S-1
Source: 0001193125-25-312729
Chunk: 314

Company: Legence Corp.
Filing Date: 2025-12-09
Form: S-1
Chunk 314
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 purposes and indirectly owns 100% of the shares of multiple corporations.
The corporations indirectly owned by Parent are subject to entity-level taxation and, as a result, provision for federal, state and local income taxes.

Income taxes for the corporations are provided for under the asset and liability method. Under this method, deferred tax assets and
liabilities are determined based on the difference between the Consolidated Balance Sheets and tax basis of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates in effect for the
year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to an amount that is more likely than not to be realized.

Under the provisions of ASC 740-10, Income Taxes—Overall(“ASC 740-10”), the Company evaluates uncertain tax positions by reviewing against applicable tax law all positions taken by the Company with respect to tax years for which the statute of limitations is still open.
ASC 740-10 provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any
related appeals or litigation processes, based on the technical merits. For those tax positions where it is not “more likely than not” that a tax benefit will be sustained, no tax benefit is recognized. The Company classifies interest
expense and penalties relating to income tax in the Consolidated Statements of Operations as Income tax expense (benefit).

Earnings Per Share

Earnings per share is not presented in the Consolidated Financial Statements as the Company is a single member limited liability company.

F-62

Recent Accounting Pronouncements

Income Statement—Expense Disaggregation—In November 2024, the Financial Accounting Standards Board (“FASB”)
issued Accounting Standards Update (“ASU”) 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures” (“Update 2024-03”). This update requires disclosure, in the notes to the financials statements, of disaggregated information about certain income statement costs and expenses on an interim and annual basis. Update 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact
that the adoption of Update 2024-03 will have on its Consolidated Financial Statements.

Compensation—Stock Compensation