HUNTINGTON BANCSHARES INC /MD/HBAN
HUNTINGTON BANCSHARES INC /MD/ Income Taxes Disclosure
INCOME TAXES
The following is a summary of the provision for income taxes.
| Year Ended December 31, | |||||||||||||||||
| (dollar amounts in millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Income before income taxes | |||||||||||||||||
U.S. | $ | 2,666 | $ | 2,369 | $ | 2,353 | |||||||||||
Foreign | 22 | 34 | 31 | ||||||||||||||
Total income before income taxes | $ | 2,688 | $ | 2,403 | $ | 2,384 | |||||||||||
| Current tax provision | |||||||||||||||||
| Federal | $ | 778 | $ | 411 | $ | 644 | |||||||||||
| State and local | 79 | 43 | 63 | ||||||||||||||
| Foreign | 5 | 15 | 8 | ||||||||||||||
| Total current tax provision | 862 | 469 | 715 | ||||||||||||||
| Deferred tax (benefit) provision | |||||||||||||||||
| Federal | (386) | (24) | (291) | ||||||||||||||
| State and local | (17) | (2) | (11) | ||||||||||||||
| Total deferred tax (benefit) provision | (403) | (26) | (302) | ||||||||||||||
Total provision for income taxes | |||||||||||||||||
Federal | 392 | 387 | 353 | ||||||||||||||
State and local | 62 | 41 | 52 | ||||||||||||||
Foreign | 5 | 15 | 8 | ||||||||||||||
| Provision for income taxes | $ | 459 | $ | 443 | $ | 413 | |||||||||||
The following is a reconciliation of the provision for income taxes.
Year Ended December 31, | |||||||||||||||||||||||||||||||||||
| (dollar amounts in millions) | 2025 | 2024 | 2023 | ||||||||||||||||||||||||||||||||
| Provision for income taxes computed at the statutory rate | $ | 564 | 21.0 | % | $ | 505 | 21.0 | % | $ | 501 | 21.0 | % | |||||||||||||||||||||||
| Increases (decreases): | |||||||||||||||||||||||||||||||||||
| Domestic federal | |||||||||||||||||||||||||||||||||||
| Tax credits | |||||||||||||||||||||||||||||||||||
| LIHTC credits and benefits, net of amortization | (69) | (2.6) | (39) | (1.6) | (56) | (2.3) | |||||||||||||||||||||||||||||
| Research and development credits | (24) | (0.9) | (28) | (1.2) | (24) | (1.0) | |||||||||||||||||||||||||||||
| Investment tax credits | (37) | (1.4) | (20) | (0.8) | (30) | (1.3) | |||||||||||||||||||||||||||||
| Other | (1) | — | (1) | — | (2) | (0.1) | |||||||||||||||||||||||||||||
| Nontaxable and nondeductible items, net | |||||||||||||||||||||||||||||||||||
| Tax-exempt income | (35) | (1.3) | (29) | (1.2) | (28) | (1.2) | |||||||||||||||||||||||||||||
| Other | 7 | 0.3 | 1 | — | 2 | 0.1 | |||||||||||||||||||||||||||||
| Changes in valuation allowance | (7) | (0.3) | 7 | 0.3 | — | — | |||||||||||||||||||||||||||||
| Domestic state and local income taxes, net of federal effect (1) | 49 | 1.8 | 32 | 1.3 | 41 | 1.7 | |||||||||||||||||||||||||||||
| Foreign jurisdictions | 2 | 0.1 | 5 | 0.2 | 2 | 0.1 | |||||||||||||||||||||||||||||
| Changes in unrecognized tax benefits | 10 | 0.4 | 10 | 0.4 | 7 | 0.3 | |||||||||||||||||||||||||||||
| Provision for income taxes | $ | 459 | 17.1 | % | $ | 443 | 18.4 | % | $ | 413 | 17.3 | % | |||||||||||||||||||||||
(1)In 2025, state and local income taxes in New York, Minnesota, Illinois, New York City, New Jersey, Indiana and Wisconsin comprised greater than 50% of the tax effect in this category. In 2024, state and local income taxes in Illinois, New York, Pennsylvania, Minnesota, California, New York City, and Florida comprised greater than 50% of the tax effect in this category. In 2023, state and local income taxes in Illinois, New York, Minnesota, California, Tennessee, Florida, Indiana, and New Jersey comprised greater than 50% of the tax effect in this category.
Income taxes paid, net of refunds received, disaggregated by federal, state, local, and foreign tax jurisdictions in which income taxes paid (net of refunds received) are equal to or greater than five percent of total income taxes paid (net of refunds received), are summarized as follows.
| Year Ended December 31, | |||||||||||||||||
| (dollar amounts in millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Federal | $ | 182 | $ | 43 | $ | 12 | |||||||||||
| State and local: | |||||||||||||||||
| Illinois | 17 | 10 | 6 | ||||||||||||||
| New York | * | 11 | * | ||||||||||||||
| New York City | * | 7 | * | ||||||||||||||
| Minnesota | * | * | 9 | ||||||||||||||
| California | * | * | 6 | ||||||||||||||
| Wisconsin | * | * | 6 | ||||||||||||||
| New Jersey | * | * | 5 | ||||||||||||||
| Other | 63 | 43 | 37 | ||||||||||||||
| Total state and local | 80 | 71 | 69 | ||||||||||||||
| Foreign: | |||||||||||||||||
| Canada | * | 9 | 9 | ||||||||||||||
| Other | 12 | — | — | ||||||||||||||
| Total foreign | 12 | 9 | 9 | ||||||||||||||
| Total income taxes paid, net of refunds received | $ | 274 | $ | 123 | $ | 90 | |||||||||||
*The amount of income taxes paid, net of refunds received, during the year does not meet the five percent disaggregation threshold, and the applicable amount is included in Other for disclosure purposes.
The significant components of deferred tax assets and liabilities were as follows.
| At December 31, | |||||||||||
| (dollar amounts in millions) | 2025 | 2024 | |||||||||
| Deferred tax assets: | |||||||||||
| Allowances for credit losses | $ | 646 | $ | 559 | |||||||
| Tax credit carryforward | 561 | 452 | |||||||||
| Fair value adjustments | 571 | 848 | |||||||||
| Research and development expenses | 136 | 108 | |||||||||
| Lease liability | 107 | 88 | |||||||||
| Net operating and other loss carryforward | 78 | 90 | |||||||||
| Pension and other employee benefits | 75 | 73 | |||||||||
| Accrued expense/prepaid | 2 | 41 | |||||||||
| Other assets | 12 | 9 | |||||||||
| Total deferred tax assets | 2,188 | 2,268 | |||||||||
| Deferred tax liabilities: | |||||||||||
| Lease financing | 701 | 968 | |||||||||
| Loan origination costs | 181 | 162 | |||||||||
| Mortgage servicing rights | 121 | 116 | |||||||||
| Right-of-use asset | 84 | 64 | |||||||||
| Securities adjustments | 54 | 48 | |||||||||
| Operating assets | 47 | 78 | |||||||||
| Other liabilities | 25 | 3 | |||||||||
| Total deferred tax liabilities | 1,213 | 1,439 | |||||||||
Net deferred tax asset before valuation allowance | 975 | 829 | |||||||||
| Valuation allowance | (27) | (36) | |||||||||
| Net deferred tax asset | $ | 948 | $ | 793 | |||||||
At December 31, 2025, Huntington’s net deferred tax asset related to loss and other carryforwards was $639 million. This was comprised of federal net operating loss carryforwards of $30 million, which will begin expiring in 2030, state net operating loss carryforwards of $34 million, which will begin expiring in 2026, a federal capital loss carryforward of $10 million, which will begin expiring in 2026, state capital loss carryforwards of $4 million, which will begin expiring in 2026, general business credits of $560 million, which will begin expiring in 2044, and a corporate alternative minimum tax carryforward of $1 million, which may be carried forward indefinitely.
The valuation allowance for deferred tax assets as of December 31, 2025 was $27 million, which included a federal valuation allowance of $2 million and a state valuation allowance of $25 million.
The Company and its subsidiaries file income tax returns in the U.S. federal jurisdiction and various state, city, and foreign jurisdictions. Federal income tax audits have been completed for tax years through 2019. The 2020-2024 tax years remain open under the statute of limitations. Also, with few exceptions, the Company is no longer subject to state, city, or foreign income tax examinations for tax years before 2021.
The following table provides a reconciliation of the beginning and ending amounts of gross unrecognized tax benefits.
| Year Ended December 31, | |||||||||||
| (dollar amounts in millions) | 2025 | 2024 | |||||||||
| Unrecognized tax benefits at beginning of year | $ | 19 | $ | 8 | |||||||
| Gross increases for tax positions taken during prior years | 8 | 7 | |||||||||
| Gross decreases for tax positions taken during prior years | — | (2) | |||||||||
| Gross increases for tax positions taken during current year | 6 | 6 | |||||||||
| Settlements with taxing authorities | (4) | — | |||||||||
| Unrecognized tax benefits at end of year | $ | 29 | $ | 19 | |||||||
Any interest and penalties on income tax assessments or income tax refunds are recognized in the Consolidated Statements of Income as a component of provision for income taxes. The amounts of accrued tax-related interest and penalties were immaterial at December 31, 2025 and 2024. Further, the amount of net interest and penalties related to unrecognized tax benefits was immaterial for all periods presented. All of the gross unrecognized tax benefits would impact the Company’s effective tax rate if recognized.
At December 31, 2025, retained earnings included approximately $182 million of base year reserves of acquired thrift institutions, for which no deferred federal income tax liability has been recognized. Under current law, if these bad debt reserves are used for purposes other than to absorb bad debt losses, they will be subject to federal income tax at the corporate rate enacted at the time. The amount of unrecognized deferred tax liability relating to the cumulative bad debt deduction was approximately $38 million at December 31, 2025.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 14, 2025 | |
| 2023 | Feb 16, 2024 | |
| 2022 | Feb 17, 2023 | |
| 2021 | Feb 18, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 14, 2020 | |
| 2018 | Feb 15, 2019 | |
| 2017 | Feb 16, 2018 | |
| 2016 | Feb 22, 2017 | |
| 2015 | Feb 17, 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.