CORNING INC /NYGLW
CORNING INC /NY Income Taxes Disclosure
Income Taxes
The following table presents the components of income before income taxes (in millions):
| Year ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| U.S. companies | $ | 1,390 | $ | 303 | $ | 105 | |||||||||||
| Non-U.S. companies | 662 | 510 | 711 | ||||||||||||||
| Income before income taxes | $ | 2,052 | $ | 813 | $ | 816 | |||||||||||
The following table presents the current and deferred amounts of the provision for income taxes, based on the location of the taxing authority (in millions):
| Year ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Current: | |||||||||||||||||
| Federal | $ | (339) | $ | (6) | $ | (8) | |||||||||||
| State and municipal | (26) | (6) | (13) | ||||||||||||||
| Foreign | (300) | (242) | (222) | ||||||||||||||
| Deferred: | |||||||||||||||||
| Federal | 324 | 63 | 76 | ||||||||||||||
| State and municipal | 19 | 6 | 7 | ||||||||||||||
| Foreign | 12 | (36) | (8) | ||||||||||||||
| Provision for income taxes | $ | (310) | $ | (221) | $ | (168) | |||||||||||
The following table presents the reconciliation of the statutory U.S. federal income tax rate to the effective tax rate (in millions):
| Year ended December 31, 2025 | ||||||||||||||
| U.S. federal statutory tax rate | $ | 431 | 21.0 | % | ||||||||||
State and local income tax, net of federal (national) income tax effect (1) | 1 | — | % | |||||||||||
| Foreign tax effects: | ||||||||||||||
| China: | ||||||||||||||
| Withholding taxes | 87 | 4.2 | % | |||||||||||
| Other | 0 | — | % | |||||||||||
| Other foreign jurisdictions | 36 | 1.8 | % | |||||||||||
| Effect of changes in tax laws or rates enacted in the current period | 0 | — | % | |||||||||||
| Effect of cross-border tax laws: | ||||||||||||||
| Foreign derived intangible income | (79) | (3.8 | %) | |||||||||||
| Other | 9 | 0.4 | % | |||||||||||
| Tax credits: | ||||||||||||||
| Foreign tax credits | (113) | (5.5 | %) | |||||||||||
| Other | (19) | (0.9 | %) | |||||||||||
| Changes in valuation allowances | 0 | — | % | |||||||||||
| Nontaxable or nondeductible items: | ||||||||||||||
| Share-based compensation | (36) | (1.8 | %) | |||||||||||
| Government incentives (IRA credits) | (32) | (1.6 | %) | |||||||||||
| Other | 17 | 0.8 | % | |||||||||||
| Changes in unrecognized tax benefits | 29 | 1.4 | % | |||||||||||
| Other adjustments | (21) | (1.0 | %) | |||||||||||
| Effective tax rate | $ | 310 | 15.1 | % | ||||||||||
(1)State tax predominantly relates to Pennsylvania, California, New Jersey, Illinois, Iowa and Georgia.
The following table presents the reconciliation of the statutory U.S. federal income tax rate to the effective tax rate:
| Year ended December 31, | |||||||||||
| 2024 | 2023 | ||||||||||
| Statutory U.S. federal income tax rate | 21.0 | % | 21.0 | % | |||||||
| State income tax provision (benefit), net of federal effect | 0.2 | (0.3) | |||||||||
| Non-deductible Items | 9.1 | 5.2 | |||||||||
| Release of cumulative translation losses | 6.0 | ||||||||||
| Audit settlements & change in reserve | 4.8 | 4.8 | |||||||||
Differential arising from foreign earnings (1) | 1.6 | 0.3 | |||||||||
| Remeasurement of deferred tax assets and liabilities | (0.8) | (0.3) | |||||||||
| Stock compensation | (0.9) | (2.1) | |||||||||
| Valuation allowance | (2.3) | 5.7 | |||||||||
| Foreign derived intangible income | (2.7) | (2.3) | |||||||||
| Tax credits | (3.9) | (6.9) | |||||||||
| Non-Taxable Items | (5.6) | (4.0) | |||||||||
| Other items, net | 0.7 | (0.5) | |||||||||
| Effective tax rate | 27.2 | % | 20.6 | % | |||||||
(1)Includes impact of intercompany asset sales.
During the year ended December 31, 2025, the Company distributed $896 million from foreign subsidiaries to their respective U.S. parent companies. As of December 31, 2025, Corning has approximately $1.9 billion of indefinitely reinvested foreign earnings. It remains impracticable to calculate the tax cost of repatriating unremitted earnings which are considered indefinitely reinvested.
Income taxes paid, net of refunds, for the years ended December 31, 2024 and 2023 were $263 million and $213 million, respectively. The following table summarizes income tax payments, net of refunds by jurisdiction for the year ended December 31, 2025 (in millions):
| Year ended December 31, 2025 | |||||
U.S. - Federal (1) | $ | 24 | |||
| U.S. - State and municipal | |||||
Other (2) | 9 | ||||
| Foreign | |||||
| China | 142 | ||||
| South Korea | 42 | ||||
| Germany | 17 | ||||
| Taiwan | 17 | ||||
Other (2) | 32 | ||||
| Income taxes paid, net of refunds | $ | 283 | |||
(1)The Company’s U.S. federal tax liabilities are substantially reduced by the use of tax credits and government incentives, which were primarily generated by Corning’s investments as discussed in Note 1 (Significant Accounting Policies).
(2)No single jurisdiction meets the separate reporting requirement for the 5% threshold.
The following table presents the tax effects of temporary differences and carryforwards that gave rise to significant portions of the deferred tax assets and liabilities (in millions):
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Loss and tax credit carryforwards | $ | 6,323 | $ | 218 | |||||||
| Other assets | 322 | 246 | |||||||||
| Research and development capitalization | 518 | 428 | |||||||||
| Asset impairments and restructuring reserves | 31 | 32 | |||||||||
| Postretirement medical and life benefits | 83 | 90 | |||||||||
| Other accrued liabilities | 428 | 375 | |||||||||
| Other employee benefits | 326 | 291 | |||||||||
| Gross deferred tax assets | 8,031 | 1,680 | |||||||||
| Valuation allowances | (6,202) | (173) | |||||||||
| Total deferred tax assets | 1,829 | 1,507 | |||||||||
| Intangible and other assets | (101) | (110) | |||||||||
| Fixed assets | (158) | (212) | |||||||||
| Finance leases | (204) | (192) | |||||||||
| Total deferred tax liabilities | (463) | (514) | |||||||||
| Net deferred tax assets | $ | 1,366 | $ | 993 | |||||||
Previously, Luxembourg deferred tax assets from net operating losses were not recognized because their utilization was considered remote. As of December 31, 2025, the likelihood is now no longer remote but not more-likely-than-not, so the Company recognized $6.0 billion of deferred tax assets, fully offset by a valuation allowance.
Net deferred tax assets on the consolidated balance sheets consisted of the following (in millions):
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Deferred tax assets | $ | 1,515 | $ | 1,130 | |||||||
| Other liabilities | (149) | (137) | |||||||||
| Net deferred tax assets | $ | 1,366 | $ | 993 | |||||||
The following table presents details of the deferred tax assets for loss and tax credit carryforwards (in millions):
| Expiration | |||||||||||||||||||||||||||||
| Total | 2026-2030 | 2031-2035 | 2036-2045 | Indefinite | |||||||||||||||||||||||||
| Net operating losses | $ | 6,239 | $ | 44 | $ | 349 | $ | 1,439 | $ | 4,407 | |||||||||||||||||||
| Tax credits | 84 | 2 | 82 | ||||||||||||||||||||||||||
| Balance as of December 31, 2025 | $ | 6,323 | $ | 44 | $ | 351 | $ | 1,521 | $ | 4,407 | |||||||||||||||||||
The following table presents the changes in the deferred tax valuation allowance (in millions):
| 2025 | 2024 | 2023 | |||||||||||||||
| Balance as of January 1 | $ | 173 | $ | 207 | $ | 166 | |||||||||||
| Additions | 6,047 | 26 | 66 | ||||||||||||||
| Reductions | (18) | (60) | (25) | ||||||||||||||
| Balance as of December 31 | $ | 6,202 | $ | 173 | $ | 207 | |||||||||||
The following table presents the reconciliation of the beginning and ending amount of unrecognized tax benefits (in millions):
| 2025 | 2024 | 2023 | |||||||||||||||
| Balance as of January 1 | $ | 411 | $ | 373 | $ | 206 | |||||||||||
| Additions based on tax positions related to the current year | 125 | 41 | 54 | ||||||||||||||
| Additions for tax positions of prior years | 22 | 6 | 127 | ||||||||||||||
| Reductions for tax positions of prior years | (24) | (6) | (3) | ||||||||||||||
| Settlements and lapse of statute of limitations | (9) | (3) | (11) | ||||||||||||||
| Balance as of December 31 | $ | 525 | $ | 411 | $ | 373 | |||||||||||
The additions for tax positions of prior years were primarily due to tax audits, development of tax court cases and tax law changes in various jurisdictions.
As of December 31, 2025, unrecognized tax benefits that would impact the Company’s effective tax rate if recognized were $244 million.
Interest and penalties associated with uncertain tax positions are recognized as part of tax expense. For the years ended December 31, 2025, 2024 and 2023, the amount recognized was not material.
Corning Incorporated, as the common parent company, and all 80%-or-more-owned of its U.S. subsidiaries join in the filing of consolidated U.S. federal income tax returns. The statute of limitations is closed for all periods ending through December 31, 2013. All returns for periods ended through December 31, 2014, have been audited by and settled with the Internal Revenue Service (“IRS”).
The IRS is currently conducting examinations of the Company’s U.S. federal income tax returns for the years 2015 through 2018 and 2019 through 2020, including the one-time transition tax enacted under the Tax Cuts and Jobs Act of 2017. If challenged, Corning believes that it is more likely than not to sustain its position relating to these matters. However, if the Company is ultimately unsuccessful in defending its position, the impact could be material to its consolidated financial statements.
Corning Incorporated and its U.S. subsidiaries file income tax returns on a combined, unitary or stand-alone basis in multiple state and local jurisdictions, which generally have statutes of limitations ranging from 3 to 5 years. Various state income tax returns are currently in the process of examination or administrative appeal. The Company does not expect any material proposed adjustments from any of these audits.
Corning’s foreign subsidiaries file income tax returns in the countries where their operations are located. Generally, these countries have statutes of limitations ranging from 3 to 10 years. The statute of limitations is closed through the following years in these major jurisdictions: China (2016), Japan (2014), Taiwan (2020) and South Korea (2009).
Corning Precision Materials, a South Korean subsidiary, is currently appealing certain tax assessments and tax refund claims for tax years 2010 through 2019. The Company was required to deposit the disputed tax amounts with the South Korean government as a condition of its appeal of any tax assessment. During 2023, $99 million was no longer under dispute and was refunded to the Company. The non-current receivable balance was $248 million and $253 million as of December 31, 2025 and December 31, 2024, respectively, for the amount on deposit with the South Korean government. Subsequently, on February 11, 2026, the Company received a final unfavorable ruling relating to a tax dispute for the tax years 2010-2012. As a result, the Company will reduce its receivable balance by approximately $92 million through a noncash charge to the income tax provision in the first quarter of 2026. Despite this ruling, Corning continues to believe that it is more likely than not that the Company will prevail in the appeals process relating to the remaining matters.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 12, 2024 | |
| 2022 | Feb 13, 2023 | |
| 2021 | Feb 14, 2022 | |
| 2020 | Feb 12, 2021 | |
| 2019 | Feb 18, 2020 | |
| 2018 | Feb 12, 2019 | |
| 2017 | Feb 15, 2018 | |
| 2016 | Feb 6, 2017 | |
| 2015 | Feb 12, 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.