BERKSHIRE HATHAWAY INC Income Taxes Disclosure
Our liabilities for income taxes are summarized as follows (in millions).
|
|
December 31, |
|
|||||
|
|
2025 |
|
|
2024 |
|
||
Currently payable |
|
$ |
902 |
|
|
$ |
1,806 |
|
Deferred |
|
|
85,597 |
|
|
|
83,563 |
|
Other |
|
|
456 |
|
|
|
501 |
|
|
|
$ |
86,955 |
|
|
$ |
85,870 |
|
Notes to Consolidated Financial Statements
Our deferred income tax assets and liabilities are summarized by type of temporary difference as follows (in millions).
|
|
December 31, |
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|||||
|
|
2025 |
|
|
2024 |
|
||
Deferred income tax liabilities: |
|
|
|
|
|
|
||
Investments, including unrealized appreciation |
|
$ |
48,411 |
|
|
$ |
47,158 |
|
Deferred charges - retroactive reinsurance |
|
|
1,702 |
|
|
|
1,847 |
|
Property, plant and equipment and equipment held for lease |
|
|
34,834 |
|
|
|
33,590 |
|
Goodwill and other intangible assets |
|
|
7,399 |
|
|
|
7,498 |
|
Other |
|
|
4,528 |
|
|
|
5,043 |
|
|
|
|
96,874 |
|
|
|
95,136 |
|
Deferred income tax assets: |
|
|
|
|
|
|
||
Unpaid insurance losses and loss adjustment expenses |
|
|
1,270 |
|
|
|
1,226 |
|
Unearned insurance premiums |
|
|
1,323 |
|
|
|
1,284 |
|
Accrued liabilities |
|
|
2,535 |
|
|
|
2,713 |
|
Regulatory liabilities |
|
|
1,388 |
|
|
|
1,364 |
|
Deferred revenue |
|
|
2,916 |
|
|
|
2,539 |
|
Other |
|
|
1,845 |
|
|
|
2,447 |
|
|
|
|
11,277 |
|
|
|
11,573 |
|
Net deferred income tax liability |
|
$ |
85,597 |
|
|
$ |
83,563 |
|
We have not established deferred income taxes on accumulated undistributed earnings of certain foreign subsidiaries, which are expected to be reinvested indefinitely. Repatriation of all accumulated earnings of foreign subsidiaries would be impracticable to the extent that such earnings represent capital to support ongoing business operations. Generally, no U.S. federal income taxes will be imposed on future distributions of foreign earnings under current law. However, distributions to U.S. or other foreign jurisdictions could be subject to withholding and other local taxes.
A summary of income tax expense (benefit) in each of the three years ending December 31, 2025 follows (in millions).
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
U.S. federal |
|
$ |
13,044 |
|
|
$ |
18,481 |
|
|
$ |
20,764 |
|
U.S. state |
|
|
973 |
|
|
|
767 |
|
|
|
763 |
|
Foreign |
|
|
1,182 |
|
|
|
1,567 |
|
|
|
1,492 |
|
|
|
$ |
15,199 |
|
|
$ |
20,815 |
|
|
$ |
23,019 |
|
|
|
|
|
|
|
|
|
|
|
|||
Current |
|
$ |
13,332 |
|
|
$ |
30,464 |
|
|
$ |
7,642 |
|
Deferred |
|
|
1,867 |
|
|
|
(9,649 |
) |
|
|
15,377 |
|
|
|
$ |
15,199 |
|
|
$ |
20,815 |
|
|
$ |
23,019 |
|
Notes to Consolidated Financial Statements
A summary of income taxes paid in each of the three years ending December 31, 2025 follows (in millions). In each of the three years ending December 31, 2025, the U.S. was the only jurisdiction in which income taxes paid exceeded 5% of the total paid.
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
U.S. federal |
|
$ |
11,753 |
|
|
$ |
26,482 |
|
|
$ |
5,639 |
|
U.S. state |
|
|
825 |
|
|
|
891 |
|
|
|
883 |
|
Foreign |
|
|
1,400 |
|
|
|
1,171 |
|
|
|
1,243 |
|
|
|
$ |
13,978 |
|
|
$ |
28,544 |
|
|
$ |
7,765 |
|
Income tax expense (benefit) is reconciled to the U.S. federal statutory tax rate for each of the three years ending December 31, 2025 in the table below (dollars in millions).
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
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|
|
Amount |
|
|
% |
|
|
Amount |
|
|
% |
|
|
Amount |
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|
% |
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Earnings before income taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Domestic |
|
$ |
77,083 |
|
|
|
|
|
$ |
105,065 |
|
|
|
|
|
$ |
115,412 |
|
|
|
|
|||
Foreign |
|
|
5,376 |
|
|
|
|
|
|
5,311 |
|
|
|
|
|
|
4,754 |
|
|
|
|
|||
|
|
$ |
82,459 |
|
|
|
|
|
$ |
110,376 |
|
|
|
|
|
$ |
120,166 |
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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at the statutory tax rate |
|
$ |
17,316 |
|
|
|
21.0 |
% |
|
$ |
23,179 |
|
|
|
21.0 |
% |
|
$ |
25,235 |
|
|
|
21.0 |
% |
State and local income taxes, net of U.S. federal |
|
|
769 |
|
|
|
0.9 |
|
|
|
606 |
|
|
|
0.5 |
|
|
|
603 |
|
|
|
0.5 |
|
U.S. federal income tax credits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Energy production tax credits |
|
|
(2,084 |
) |
|
|
(2.5 |
) |
|
|
(2,039 |
) |
|
|
(1.8 |
) |
|
|
(1,817 |
) |
|
|
(1.5 |
) |
Other |
|
|
(597 |
) |
|
|
(0.7 |
) |
|
|
(536 |
) |
|
|
(0.5 |
) |
|
|
(369 |
) |
|
|
(0.3 |
) |
U.S. federal nontaxable or nondeductible items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dividends received deduction |
|
|
(460 |
) |
|
|
(0.6 |
) |
|
|
(491 |
) |
|
|
(0.4 |
) |
|
|
(678 |
) |
|
|
(0.6 |
) |
Other |
|
|
257 |
|
|
|
0.3 |
|
|
|
(38 |
) |
|
|
— |
|
|
|
(260 |
) |
|
|
(0.2 |
) |
Other differences, net |
|
|
(2 |
) |
|
|
— |
|
|
|
134 |
|
|
|
0.1 |
|
|
|
305 |
|
|
|
0.3 |
|
|
|
$ |
15,199 |
|
|
|
18.4 |
% |
|
$ |
20,815 |
|
|
|
18.9 |
% |
|
$ |
23,019 |
|
|
|
19.2 |
% |
——————
(1) In each year, no fewer than five states, in the aggregate, represented the majority of state income taxes.
We file income tax returns in the U.S. and in state, local and foreign jurisdictions. We have settled income tax liabilities with the U.S. federal taxing authority (“IRS”) for tax years through 2013, and the IRS is currently auditing tax years . We are also under audit or subject to audit with respect to income taxes in various state and foreign jurisdictions. It is reasonably possible that certain audits will be settled in 2026.
At December 31, 2025 and 2024, net unrecognized tax benefits were $456 million and $501 million, respectively. The balance at December 31, 2025 included $421 million in tax positions that, if recognized, would impact the effective tax rate.
The Organization for Economic Co-operation and Development (“OECD”) issued Pillar Two model rules introducing a global minimum tax of 15%. While the U.S. has not adopted Pillar Two rules, various countries have enacted legislation to adopt the rules. In January 2026, the OECD issued additional guidance, including a safe harbor framework for certain U.S.-parented multinational groups. Most jurisdictions with Pillar Two regimes in force will need further legislative action to incorporate the guidance into local law. We do not currently have material operations in jurisdictions with tax rates lower than the Pillar Two minimum tax rate, and we do not currently expect these rules will materially increase our global tax costs. There remains uncertainty as to the final Pillar Two model rules.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 2, 2026 | Showing above |
| 2024 | Feb 24, 2025 | |
| 2023 | Feb 26, 2024 | |
| 2022 | Feb 27, 2023 | |
| 2021 | Feb 28, 2022 | |
| 2020 | Mar 1, 2021 | |
| 2019 | Feb 24, 2020 | |
| 2018 | Feb 25, 2019 | |
| 2017 | Feb 26, 2018 | |
| 2016 | Feb 27, 2017 | |
| 2015 | Feb 29, 2016 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.