Global Indemnity Group, LLC Income Taxes Disclosure

10. Income Taxes

Global Indemnity Group, LLC is a publicly traded partnership for U.S. federal income tax purposes and meets the qualifying income exception to maintain partnership status. As a publicly traded partnership, Global Indemnity Group, LLC is generally not subject to federal income tax and most state income taxes. However, income earned by the subsidiaries of Global Indemnity Group, LLC is subject to corporate tax in the United States and certain foreign jurisdictions.

As of December 31, 2025, the Company conducts business in the United States, where the statutory income tax rate is 21%, and performs certain functions in Ireland, where the statutory income tax rate on trading income is 12.5%, and in Israel, where the statutory income tax rate is 23%. The statutory income tax rate of each country is applied against the expected annual taxable income of the Company in each country to estimate the annual income tax expense.

The tax provision has been calculated using income before income taxes in each jurisdiction multiplied by that jurisdiction’s applicable statutory tax rate. The Company's income before income taxes by jurisdiction was as follows:

The effective income tax rate for 2025 was 23.9%, compared to 21.3% for 2024. The increase was primarily driven by (i) state income taxes, which reflected increased state taxable income resulting from the utilization of net operating loss carryforward and changes in the Company's filing profile following its internal reorganization in 2024, (ii) higher non-deductible executive compensation, and (iii) the impact of changes in income or loss at the parent company, treated as a partnership for tax purposes.

The effective income tax rate for 2024 was 21.3% compared to 22.9% for 2023. The differences between years are primarily due to the change in income or loss at the parent company, treated as a partnership for tax purposes, as well as the impact of non-tax deductible transaction costs related to the Company's internal reorganization executed in 2024.

In 2024, the intra-entity transfers of certain intangible assets related to the Company's internal reorganization resulted in tax expense on sale of $3.8 million, offset by the establishment of deferred tax assets and related tax benefits of $3.8 million. The tax-deductible amortization related to the transferred intangible assets will be recognized over a period of 15 years.

The increase in income taxes paid during 2025 reflects the decline in net operating loss carryforwards available to offset Belmont Holdings GX, Inc.'s federal taxes in 2025.

The deferred tax assets and deferred tax liabilities listed in the table above relate to temporary differences between the Company’s accounting and tax carrying values and carryforwards for its companies in the United States. Management believes it is more likely than not that the remaining deferred tax assets will be completely utilized in future years. As a result, the Company has not recorded a valuation allowance at December 31, 2025 and 2024.

The Company has a net operating loss (“NOL”) carryforward and a capital loss carryforward of $7.3 million and $33.7 million, respectively, as of December 31, 2025. The capital loss carryforward begins to expire in 2027 based on when the original carryforwards were generated. The Company’s NOL carryforward and capital loss carryforward were $20.7 million and $21.6 million, respectively, as of December 31, 2024.

The Company and some of its subsidiaries file income tax returns in the U.S. federal jurisdiction and various U.S. states and certain foreign jurisdictions. The Company is no longer subject to U.S. federal tax examinations by tax authorities for tax years before 2022.

The Company applies a more-likely-than-not recognition threshold for all tax uncertainties whereby it only recognizes those tax benefits that have a greater than 50% likelihood of being sustained upon examination by relevant taxing authorities. All tax benefits recognized by the Company in 2025, 2024, and 2023 have a greater than 50% likelihood of being sustained upon examination by relevant taxing authorities.

The Company classifies all interest and penalties related to uncertain tax positions as income tax expense. The Company did not incur any interest and penalties related to uncertain tax positions during the years ended December 31, 2025, 2024, and 2023. As of December 31, 2025, the Company did not record any significant liabilities for tax-related interest and penalties on its consolidated balance sheets.

On July 4, 2025, the U.S enacted the One Big Beautiful Bill Act (the “Act”). The Act includes provisions to expense previously deferred domestic research and development costs, increase bonus depreciation and modify the international tax framework. The Act did not have a material impact on the Company's consolidated financial statements.