COHEN & STEERS, INC.CNS
COHEN & STEERS, INC. Income Taxes Disclosure
Income Taxes
The income before provision for income taxes and provision for income taxes are as follows:
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Income before provision for income taxes - U.S. | $ | 194,730 | $ | 195,885 | $ | 175,290 | |||||||||||
| Income before provision for income taxes - Non-U.S. | 9,900 | 13,656 | 4,961 | ||||||||||||||
| Total income before provision for income taxes | 204,630 | 209,541 | 180,251 | ||||||||||||||
| Net (income) loss attributable to noncontrolling interests | (4,181) | (11,527) | (7,560) | ||||||||||||||
| Total income excluding noncontrolling interests before provision for income taxes | $ | 200,449 | $ | 198,014 | $ | 172,691 | |||||||||||
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Current tax expense: | |||||||||||||||||
| U.S. federal | $ | 37,495 | $ | 38,203 | $ | 34,310 | |||||||||||
| State and local | 6,803 | 6,819 | 8,249 | ||||||||||||||
| Non-U.S. | 2,373 | 2,024 | 546 | ||||||||||||||
| 46,671 | 47,046 | 43,105 | |||||||||||||||
| Deferred tax (benefit) expense: | |||||||||||||||||
| U.S. federal | 783 | (942) | 2,241 | ||||||||||||||
| State and local | 531 | (254) | (1,290) | ||||||||||||||
| Non-U.S. | (753) | 899 | (414) | ||||||||||||||
| 561 | (297) | 537 | |||||||||||||||
| Provision for income taxes | $ | 47,232 | $ | 46,749 | $ | 43,642 | |||||||||||
A reconciliation of the Company’s statutory federal income tax rate to the effective tax rate is as follows:
| Years Ended December 31, | |||||||||||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||||||||||||||
| U.S. federal statutory tax rate | $ | 42,094 | 21.0 | % | $ | 41,583 | 21.0 | % | $ | 36,265 | 21.0 | % | |||||||||||||||||
State and local income taxes, net of federal benefit (1) | 5,914 | 3.0 | 5,406 | 2.7 | 5,453 | 3.2 | |||||||||||||||||||||||
| Nontaxable or nondeductible items: | |||||||||||||||||||||||||||||
| Nondeductible executive compensation | 3,853 | 1.9 | 2,363 | 1.2 | 3,270 | 1.9 | |||||||||||||||||||||||
| Excess tax benefits related to the vesting and delivery of restricted stock units | (3,278) | (1.6) | (485) | (0.2) | (1,928) | (1.1) | |||||||||||||||||||||||
| Changes in unrecognized tax benefits | (723) | (0.4) | (737) | (0.4) | 56 | — | * | ||||||||||||||||||||||
| Valuation allowance | (639) | (0.3) | (1,308) | (0.7) | 605 | 0.4 | |||||||||||||||||||||||
| Foreign tax effects | (460) | (0.2) | 54 | — | * | (633) | (0.4) | ||||||||||||||||||||||
| Effect of cross-border tax laws | 216 | 0.1 | 73 | — | * | 107 | 0.1 | ||||||||||||||||||||||
| Effect of changes in tax laws or rates | (58) | — | * | 44 | — | * | 18 | — | * | ||||||||||||||||||||
| Other | 313 | 0.1 | (244) | — | * | 429 | 0.2 | ||||||||||||||||||||||
| Income tax expense and effective income tax rate | $ | 47,232 | 23.6 | % | $ | 46,749 | 23.6 | % | $ | 43,642 | 25.3 | % | |||||||||||||||||
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* Amounts round to less than 0.01%.
(1)State taxes in California, New York and Pennsylvania make up the majority (more than 50%) of the tax effect in this category.
A reconciliation of the Company’s income taxes paid, net of tax refunds, is as follows:
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| U.S. federal | $ | 42,637 | $ | 39,962 | $ | 32,438 | |||||||||||
| State and local | 7,237 | 6,172 | 12,043 | ||||||||||||||
| Non-U.S. | 1,860 | 1,069 | 1,339 | ||||||||||||||
| Total | 51,734 | 47,203 | 45,820 | ||||||||||||||
Income taxes paid, net of tax refunds, exceeded 5 percent of the total in the following jurisdictions:
_________________________
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| State and local: | |||||||||||||||||
| Minnesota | * | * | $ | 2,784 | |||||||||||||
* Jurisdiction below the threshold for the period presented.
The significant components of the Company’s net deferred tax asset consist of the following:
| At December 31, | |||||||||||
| (in thousands) | 2025 | 2024 | |||||||||
| Deferred tax assets: | |||||||||||
| Stock-based compensation | $ | 9,817 | $ | 10,616 | |||||||
| Lease liabilities | 30,445 | 31,653 | |||||||||
| Net unrealized losses on investments | 910 | 859 | |||||||||
| Capital loss carryforwards | 74 | 424 | |||||||||
| Other | 408 | 421 | |||||||||
| Gross deferred tax assets | 41,654 | 43,973 | |||||||||
| Less: valuation allowance | (599) | (1,283) | |||||||||
| Deferred tax assets net of valuation allowance | 41,055 | 42,690 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Right-of-use assets | (21,101) | (21,885) | |||||||||
Property and equipment depreciation | (10,275) | (10,933) | |||||||||
| Net unrealized gains on investments | (2,381) | (1,947) | |||||||||
| Gross deferred tax liabilities | (33,757) | (34,765) | |||||||||
| Net deferred tax asset | $ | 7,298 | $ | 7,925 | |||||||
Deferred tax assets and liabilities are recorded net when related to the same jurisdiction. The Company records deferred tax assets in other assets and deferred tax liabilities in other liabilities and accrued expenses on the consolidated statements of financial condition.
The Company had capital loss carryforwards of $0.3 million and $1.8 million for the years ended December 31, 2025 and 2024, respectively, which, if unused, will expire in year 2028. The valuation allowance on the net deferred tax asset decreased by $0.7 million during the year ended December 31, 2025.
A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:
| Years Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| Balance at January 1 | $ | 1,311 | $ | 2,531 | $ | 4,977 | |||||||||||
| Addition for tax positions of current year | 182 | 458 | 1,076 | ||||||||||||||
| Reduction for tax positions from prior years | (727) | (1,678) | (366) | ||||||||||||||
| Settlements | (220) | — | (3,156) | ||||||||||||||
| Balance at December 31 | $ | 546 | $ | 1,311 | $ | 2,531 | |||||||||||
As of December 31, 2025, the Company had $0.5 million of total gross unrecognized tax benefits. This entire amount, net of the federal benefit on state issues, represents the amount of unrecognized tax benefits that, if recognized, would favorably affect the Company’s effective tax rate in future periods.
The Company records potential interest and penalties related to uncertain tax positions in the provision for income taxes. As of December 31, 2025 and 2024, the Company had $0.1 million and $0.4 million, respectively, in potential interest and penalties associated with uncertain tax positions.
The tax years 2019 through 2024 remain open to examination by various taxing jurisdictions.
On July 4, 2025, President Trump signed into law the legislation formally titled “An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14”, which became effective during the third quarter of fiscal year 2025. The Company has determined the legislation did not have a material impact on the Company's consolidated financial statements and related disclosures.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 21, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 25, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Mar 1, 2019 | |
| 2017 | Feb 23, 2018 | |
| 2016 | Feb 24, 2017 | |
| 2015 | Feb 26, 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.