Company: ICUI
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0000883984-25-000007
Chunk: 173

Company: ICU MEDICAL INC/DE
Filing Date: 2025-02-27
Form: 10-K
Item: Item 1
Chunk 173
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 with BMO Bank N.A. ("BMO") (see Note: 18 Accounts Receivable Purchase Program). In 2023, other miscellaneous (expense) income, net primarily includes $3.7 million in fees related to our accounts receivable purchase program (see Note 18: Accounts Receivable Purchase Program) mostly offset by a business interruption gain recognized upon receipt of insurance proceeds. We received total insurance recoveries for property damage and business interruption of $3.1 million, $2.6 million of which was related to insurance proceeds for business interruption included within other miscellaneous (expense) income, net. 

Income taxes 

Income taxes were accrued at an estimated annual effective tax rate of (78)%, 62% and 35% in 2024, 2023 and 2022, respectively.

The effective tax rate in 2024 differs from the federal statutory rate of 21% principally because of the effect of the mix of U.S. and foreign income, foreign-derived intangible income (“FDII”), federal and state valuation allowance, tax reserve releases, and tax credits. The effective tax rate in 2024 included a tax benefit of $10.1 million primarily related to unrecognized tax benefits released as a result of the expiration of the statute of limitations offset by a tax expense of $81.7 million related to a valuation allowance against certain U.S. federal and state deferred tax assets. 

The Company regularly assesses the realizability of deferred tax assets and records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be realized. In assessing the realizability of our deferred tax assets, we weigh all available positive and negative evidence. This evidence includes, but is not limited to, historical earnings, scheduled reversal of taxable temporary differences, tax planning strategies and projected future taxable income. Due to the weight of objectively verifiable negative evidence, the Company recorded a valuation allowance of $81.7 million tax expense and $3.9 million foreign currency translation and derivative instrument adjustments against certain U.S. federal and state deferred tax assets for the tax years ending December 31, 2024.  The significant piece of objectively verifiable negative evidence evaluated was the recent U.S. cumulative losses. Our ability to use our deferred tax assets depends on the amount of taxable income in future periods.       

In December 2022, the European Union (EU) agreed to implement Pillar Two, the OECD’s global minimum tax rate of 15% for multinationals that meet a