IDEX CORP /DE/IEX
IDEX CORP /DE/ Income Taxes Disclosure
Income Taxes
For the years ended December 31, 2024 and 2023, the Company paid income taxes, net of refunds, of $171.4 million and $199.5 million, respectively.
Pretax income for 2025, 2024 and 2023 was taxed in the following jurisdictions:
| 2025 | 2024 | 2023 | |||||||||||||||
| U.S. | $ | 375.5 | $ | 377.9 | $ | 534.1 | |||||||||||
| Foreign | 257.1 | 261.4 | 226.2 | ||||||||||||||
| Total | $ | 632.6 | $ | 639.3 | $ | 760.3 | |||||||||||
The provision (benefit) for income taxes for 2025, 2024 and 2023 was as follows:
| 2025 | 2024 | 2023 | |||||||||||||||
| Current | |||||||||||||||||
| U.S. | $ | 47.4 | $ | 69.0 | $ | 103.8 | |||||||||||
| State and local | 10.9 | 11.6 | 13.7 | ||||||||||||||
| Foreign | 79.0 | 73.5 | 61.9 | ||||||||||||||
| Total current | 137.3 | 154.1 | 179.4 | ||||||||||||||
| Deferred | |||||||||||||||||
| U.S. | 26.1 | (2.6) | (11.1) | ||||||||||||||
| State and local | 1.9 | (2.1) | 1.7 | ||||||||||||||
| Foreign | (15.2) | (14.7) | (5.3) | ||||||||||||||
| Total deferred | 12.8 | (19.4) | (14.7) | ||||||||||||||
| Total provision for income taxes | $ | 150.1 | $ | 134.7 | $ | 164.7 | |||||||||||
Deferred tax assets (liabilities) at December 31, 2025 and 2024 were:
| December 31, 2025 | December 31, 2024 | ||||||||||
| Allowances and accruals | $ | 23.7 | $ | 21.7 | |||||||
| Employee and retiree benefit plans | 19.8 | 19.4 | |||||||||
| Inventories | 17.3 | 13.9 | |||||||||
| Foreign tax credit and other carryforwards | 30.4 | 20.8 | |||||||||
| Lease liabilities | 27.8 | 26.4 | |||||||||
| Right of use assets | (26.7) | (25.1) | |||||||||
| Depreciation and amortization | (353.8) | (311.6) | |||||||||
| Taxes on undistributed foreign earnings | (17.4) | (14.9) | |||||||||
| Other | 0.8 | 1.0 | |||||||||
| Total gross deferred tax liabilities | (278.1) | (248.4) | |||||||||
| Valuation allowance | (23.7) | (17.3) | |||||||||
| Total deferred tax liabilities, net of valuation allowances | $ | (301.8) | $ | (265.7) | |||||||
The deferred tax assets and liabilities recognized in the Company’s Consolidated Balance Sheets as of December 31, 2025 and 2024 were:
| December 31, 2025 | December 31, 2024 | ||||||||||
| Noncurrent deferred tax asset - Other noncurrent assets | $ | 1.2 | $ | 1.5 | |||||||
| Noncurrent deferred tax liabilities - Deferred income taxes | (303.0) | (267.2) | |||||||||
| Net deferred tax liabilities | $ | (301.8) | $ | (265.7) | |||||||
The Company had prepaid income taxes, recorded within Other current assets on the Consolidated Balance Sheets, of $20.2 million and $18.3 million as of December 31, 2025 and 2024, respectively.
As further described in Note 1, “Significant Accounting Policies,” the Company has elected to prospectively adopt the guidance in ASU 2023-09, Improvements to Income Tax Disclosures. The following table shows the principal reasons for the difference between the effective income tax rate and the statutory federal income tax rate for the year ended December 31, 2025 in accordance with ASU 2023-09:
| 2025 | |||||||||||
U.S. Federal statutory tax rate | $ | 132.8 | 21.0 | % | |||||||
State and local income taxes, net of federal income tax effect(1) | 10.1 | 1.6 | % | ||||||||
| Foreign tax effects | 11.0 | 1.7 | % | ||||||||
| Effect of cross-border tax laws | 2.6 | 0.4 | % | ||||||||
| Tax credits | |||||||||||
Foreign tax credit(2) | (10.4) | (1.6 | %) | ||||||||
| Other | (3.8) | (0.6 | %) | ||||||||
Changes in valuation allowances(2) | 4.5 | 0.7 | % | ||||||||
| Nontaxable or nondeductible items | 3.4 | 0.5 | % | ||||||||
| Changes in unrecognized tax benefits | 0.4 | 0.1 | % | ||||||||
| Other adjustments | (0.5) | (0.1 | %) | ||||||||
| Total provision for income taxes | $ | 150.1 | 23.7 | % | |||||||
(1) The states that contribute to the majority (greater than 50%) of the tax effect in this category include California, Florida and Illinois.
(2) During 2025, the Company recorded an additional deferred tax asset for a foreign tax credit carryforward of $4.4 million with a full valuation allowance.
The following table is a reconciliation of the U.S. federal statutory rate and the effective tax rate for the years ended December 31, 2024 and 2023 in accordance with U.S. GAAP prior to the adoption of ASU 2023-09:
| 2024 | 2023 | |||||||||||||||||||||||||
| Pretax income | $ | 639.3 | $ | 760.3 | ||||||||||||||||||||||
| Provision for income taxes: | ||||||||||||||||||||||||||
| Computed amount at statutory rate of 21% | $ | 134.2 | 21.0 | % | $ | 159.7 | 21.0 | % | ||||||||||||||||||
| State and local income tax, net of federal tax benefit | 7.3 | 1.1 | % | 12.6 | 1.7 | % | ||||||||||||||||||||
| Taxes on non-U.S. earnings, net of foreign tax credits | 6.3 | 1.0 | % | 10.8 | 1.4 | % | ||||||||||||||||||||
| Foreign-Derived Intangible Income Deduction | (9.7) | (1.5 | %) | (11.3) | (1.5 | %) | ||||||||||||||||||||
| Share-based payments | (0.7) | (0.1 | %) | (2.0) | (0.3 | %) | ||||||||||||||||||||
| Other | (2.7) | (0.4 | %) | (5.1) | (0.6 | %) | ||||||||||||||||||||
| Total provision for income taxes | $ | 134.7 | 21.1 | % | $ | 164.7 | 21.7 | % | ||||||||||||||||||
The Company has $90.2 million and $73.4 million of permanently reinvested earnings of non-U.S. subsidiaries as of December 31, 2025 and 2024, respectively. No deferred U.S. income taxes have been provided on the $90.2 million of earnings that are considered to be permanently reinvested. The Company does not expect these earnings to incur U.S. taxes when ultimately repatriated other than potentially U.S. federal, state and local taxes on foreign exchange gains or losses recognized on the distribution of such earnings. Such distributions could also be subject to additional foreign withholding and foreign income taxes. The amount of unrecognized deferred income tax liabilities on currently permanently reinvested earnings is estimated to be $13.5 million and $11.0 million as of December 31, 2025 and 2024, respectively.
During the years ended December 31, 2025, 2024 and 2023, the Company repatriated $79.8 million, $483.8 million and $134.1 million of foreign earnings, respectively. These actual distributions resulted in no incremental income tax expense other than tax impacts on foreign exchange gains or losses.
As of December 31, 2025, the Company had an unrecognized tax benefit of $0.3 million, resulting from a gross increase for tax positions of prior years. The Company did not have any significant unrecognized tax benefits in 2024 and 2023. The Company recognizes interest and penalties related to uncertain tax positions within Provision for income taxes in the
Consolidated Statements of Income. As of December 31, 2025, the Company accrued interest and penalties of less than $0.2 million related to uncertain tax positions.
As of December 31, 2025, the total amount of unrecognized tax benefits that would affect the Company's effective tax rate if recognized is $0.3 million. The tax years 2020-2025 remain open to examination by major taxing jurisdictions.
As of December 31, 2025, the Company has deferred tax assets on U.S., non-U.S. and U.S. state net operating loss carryforwards of $2.5 million, $1.0 million and $0.9 million, respectively. The majority of the balance of net operating losses across jurisdictions, most of which relates to acquisitions, is available to be carried forward indefinitely. The deferred tax assets on the non-U.S. net operating losses have a valuation allowance of $0.9 million. There is no valuation allowance on the U.S. and U.S. state net operating loss carryforward as it is more likely than not that the net operating losses will be realized.
As of December 31, 2025, the Company has deferred tax assets on non-U.S. capital loss carryforwards of $3.8 million with a full valuation allowance. The non-U.S. capital loss can be carried forward indefinitely.
As of December 31, 2025, the Company has deferred tax assets on non-U.S. disallowed interest expense carryforwards of $3.5 million. The non-U.S. disallowed interest expense carryforwards are available to be carried forward indefinitely. A valuation allowance of $0.7 million has been recorded to recognize only the portion of the deferred tax asset that is more likely than not to be realized.
As of December 31, 2025, the Company has deferred tax assets on foreign tax credit carryforwards for U.S. federal tax purposes of approximately $17.9 million with a full valuation allowance. The U.S. federal foreign tax credit carryforward will expire between 2029 and 2035.
Disclosed below is a summary of income taxes paid by jurisdiction for the year ended December 31, 2025, in accordance with ASU 2023-09:
| 2025 | |||||
| Federal | $ | 46.8 | |||
| State | 11.1 | ||||
| Foreign | |||||
China | 8.5 | ||||
| Germany | 23.7 | ||||
| India | 6.9 | ||||
| Netherlands | 12.7 | ||||
| All other foreign | 24.9 | ||||
| Income taxes paid, net of amounts refunded | $ | 134.6 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 21, 2020 | |
| 2018 | Feb 28, 2019 | |
| 2017 | Feb 22, 2018 | |
| 2016 | Feb 23, 2017 | |
| 2015 | Feb 19, 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.