Blackstone Secured Lending FundBXSL
Blackstone Secured Lending Fund Income Taxes Disclosure
Income Taxes
Taxable income differs from net increase (decrease) in net assets resulting from operations primarily due to: (1) unrealized appreciation (depreciation) on investments, as gains and losses are generally not included in taxable income until they are realized; (2) income or loss recognition on exited investments; (3) non-deductible U.S. federal excise taxes; and (4) other non-deductible expenses.
The Company makes certain adjustments to the classification of net assets as a result of permanent book-to-tax differences, which include differences in the book and tax basis of certain assets and liabilities, and non-deductible federal taxes or losses among other items. To the extent these differences are permanent, they are charged or credited to additional paid in capital, undistributed net investment income or undistributed net realized gains on investments, as appropriate. For the years ended December 31, 2025, 2024 and 2023, permanent differences were as follows:
| For the Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Undistributed net investment income (loss) | $ | (25,324) | $ | 54,084 | $ | 32,895 | ||||||||||||||
| Accumulated net realized gain (loss) | $ | 41,406 | $ | (39,560) | $ | (15,911) | ||||||||||||||
| Paid In Capital | $ | (16,082) | $ | (14,524) | $ | (16,984) | ||||||||||||||
During the years ended December 31, 2025, 2024 and 2023, permanent differences were principally related to $16.1 million, $14.5 million and $16.8 million, respectively, of U.S. federal excise taxes and $0.0 million, $0.0 million and $0.2 million, respectively, of non-deductible offering costs.
For tax purposes, the Company may elect to defer any portion of a post-October capital loss or late-year ordinary loss to the first day of the following fiscal year. As of December 31, 2025, 2024 and 2023, there were none.
The following reconciles the increase in net assets resulting from operations to taxable income for the years ended December 31, 2025, 2024 and 2023:
| For the Year Ended December 31, | ||||||||||||||||||||
2025 (1) | 2024 | 2023 | ||||||||||||||||||
| Net increase (decrease) in net assets resulting from operations | $ | 563,455 | $ | 694,097 | $ | 611,951 | ||||||||||||||
| Net change in unrealized (appreciation) depreciation | 153,696 | 13,485 | 54,573 | |||||||||||||||||
| Realized gains (losses) for tax not included in book income | (21,935) | 4,362 | (917) | |||||||||||||||||
| Non-deductible capital gains based incentive fees | — | — | (5,506) | |||||||||||||||||
| Other non-deductible expenses and excise taxes | 16,082 | 14,524 | 16,984 | |||||||||||||||||
| Net post-October capital loss deferral (reversal) | — | — | — | |||||||||||||||||
| Realized losses for tax not recognized | 253 | 10,674 | — | |||||||||||||||||
| Taxable/distributable income | $ | 711,551 | $ | 737,142 | $ | 677,085 | ||||||||||||||
(1)Tax information for the fiscal year ended December 31, 2025 is estimated and is not considered final until the Company files its tax return.
The components of accumulated gains (losses) as calculated on a tax basis for the years ended December 31, 2025, 2024 and 2023 were as follows:
| For the Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Distributable ordinary income | $ | 415,758 | $ | 413,107 | $ | 281,140 | ||||||||||||||
| Distributable capital gains | — | — | 26,953 | |||||||||||||||||
| Capital losses carried forward | (253) | (10,674) | — | |||||||||||||||||
| Other temporary book/tax differences | — | — | — | |||||||||||||||||
| Net change in unrealized appreciation/(depreciation) on investments | (218,312) | (75,896) | (58,065) | |||||||||||||||||
| Total accumulated under-distributed (over-distributed) earnings | $ | 197,193 | $ | 326,537 | $ | 250,028 | ||||||||||||||
Under the Regulated Investment Company Modernization Act of 2010, net capital losses recognized by the Company may get carried forward indefinitely, and retain their character as short-term and/or long-term losses. Any such losses will be deemed to arise on the first day of the next taxable year. Capital losses for the years ended December 31, 2025, 2024 and 2023, which will be deemed to arise on the first day of the tax years ended December 31, 2026, 2025 and 2024, respectively, were as follows:
| For the Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Short-term | $ | — | $ | — | $ | — | ||||||||||||||
| Long-term | $ | 253 | $ | 10,674 | $ | — | ||||||||||||||
The cost and unrealized gain (loss) of the Company’s investments, as calculated on a tax basis, at December 31, 2025, December 31, 2024 and December 31, 2023 were as follows:
| For the Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Gross unrealized appreciation | $ | 164,873 | $ | 111,961 | $ | 86,757 | |||||||||||
| Gross unrealized depreciation | (332,232) | (210,627) | (146,095) | ||||||||||||||
| Net change in unrealized appreciation (depreciation) | $ | (167,359) | $ | (98,666) | $ | (59,338) | |||||||||||
| Tax cost of investments | $ | 14,374,653 | $ | 13,191,184 | $ | 9,927,777 | |||||||||||
During the year ended December 31, 2025, $708.9 million of the dividends declared were derived from ordinary income and none were from capital gains, as determined on a tax basis.
During the year ended December 31, 2024, $607.8 million and $24.3 million of the dividends declared were derived from ordinary income and capital gains, respectively, as determined on a tax basis.
During the year ended December 31, 2023, $456.8 million and $47.9 million of the dividends declared were derived from ordinary income and capital gains, respectively, as determined on a tax basis.
BGSL Investments, a wholly-owned and consolidated subsidiary that was formed in 2019, is a Delaware limited liability company which has elected to be treated as a corporation for U.S. tax purposes. As such, BGSL Investments is subject to certain U.S. federal, state and local taxes. For the years ended December 31, 2025, 2024, and 2023, BGSL Investments recorded an income tax provision of $2.3 million, $1.7 million and $0.0 million, respectively.
As of December 31, 2025 and 2024, BGSL Investments recorded a deferred tax liability of $4.0 million and $1.7 million, respectively, which is significantly related to GAAP to tax outside basis difference in investment in certain partnership interests and included within Accrued expenses and other liabilities in the Consolidated Statements of Assets and Liabilities.
For the year ended December 31, 2025, BGSL Investments recorded a current tax expense of $0.6 million, which was substantially related to realized gains associated with the sale of an investment in a partnership interest. For the years ended December 31, 2024 and December 31, 2023, BGSL Investments recorded no current tax expense.
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.