GARTNER INCIT
GARTNER INC Income Taxes Disclosure
Income Taxes
Below is a summary of the components of the Company’s income before income taxes for the years ended December 31 (in thousands).
| 2025 | 2024 | 2023 | |||||||||||||||
| U.S. | $ | 302,391 | $ | 629,656 | $ | 574,458 | |||||||||||
| Non-U.S. | 665,727 | 757,718 | 572,671 | ||||||||||||||
| Income before income taxes | $ | 968,118 | $ | 1,387,374 | $ | 1,147,129 | |||||||||||
The components of the expense (benefit) for income taxes on the above income are summarized in the table below (in thousands).
| 2025 | 2024 | 2023 | |||||||||||||||
| Current tax expense: | |||||||||||||||||
| U.S. federal | $ | 104,476 | $ | 161,155 | $ | 171,917 | |||||||||||
| State and local | 36,615 | 48,084 | 51,441 | ||||||||||||||
| Foreign | 95,788 | 88,318 | 107,421 | ||||||||||||||
| Total current | 236,879 | 297,557 | 330,779 | ||||||||||||||
| Deferred tax (benefit) expense: | |||||||||||||||||
| U.S. federal | (9,578) | (31,708) | (35,457) | ||||||||||||||
| State and local | (1,834) | 963 | (13,475) | ||||||||||||||
| Foreign | 17,386 | (128,291) | (12,845) | ||||||||||||||
| Total deferred | 5,974 | (159,036) | (61,777) | ||||||||||||||
| Total current and deferred | 242,853 | 138,521 | 269,002 | ||||||||||||||
Expense relating to interest rate swaps used to increase equity | (3,405) | (4,695) | (4,976) | ||||||||||||||
| Benefit from stock transactions with employees used to increase equity | 113 | 97 | 105 | ||||||||||||||
Benefit (expense) relating to defined-benefit pension adjustments used to increase equity | (674) | (264) | 532 | ||||||||||||||
| Total tax expense | $ | 238,887 | $ | 133,659 | $ | 264,663 | |||||||||||
The components of long-term deferred tax assets (liabilities) are summarized in the table below (in thousands).
| December 31, | |||||||||||
| 2025 | 2024 | ||||||||||
| Accrued liabilities | $ | 110,054 | $ | 86,831 | |||||||
| Operating leases | 32,590 | 41,777 | |||||||||
| Intangible assets | — | 132,292 | |||||||||
| Property, equipment and leasehold improvements | 5,480 | 11,592 | |||||||||
| Loss and credit carryforwards | 191,660 | 61,313 | |||||||||
| Assets relating to equity compensation | 40,078 | 37,247 | |||||||||
| Other assets | 7,547 | 16,870 | |||||||||
| Gross deferred tax assets | 387,409 | 387,922 | |||||||||
| Valuation allowance | (86,787) | (76,285) | |||||||||
| Net deferred tax assets | 300,622 | 311,637 | |||||||||
| Intangible assets | (1,879) | — | |||||||||
| Prepaid expenses | (70,155) | (79,559) | |||||||||
| Other liabilities | (12,468) | (18,063) | |||||||||
| Gross deferred tax liabilities | (84,502) | (97,622) | |||||||||
Net deferred tax assets | $ | 216,120 | $ | 214,015 | |||||||
Net deferred tax assets and net deferred tax liabilities were $245.4 million and $29.3 million as of December 31, 2025, respectively, and $262.8 million and $48.7 million as of December 31, 2024, respectively. These amounts are reported in Other assets and Other liabilities in the Consolidated Balance Sheets. Management has concluded it is more likely than not that the reversal of deferred tax liabilities and results of future operations will generate sufficient taxable income to realize the deferred tax assets, net of the valuation allowance at December 31, 2025.
In December 2024, the Company completed an intercompany transfer of certain intellectual property. As a result, the Company recorded a deferred tax asset of approximately $163.2 million which represents the value of future tax deductions for amortization of the assets in the acquiring jurisdiction. A portion of the tax amortization was recognized initially in 2024. Subsequently the full amount of tax amortization was taken in respect of this intellectual property. The deferred tax asset for intangible assets was reduced for the impact of this tax amortization, with the offset reflected as an increase in the deferred tax
asset for loss carryforwards. These amounts have been reduced for associated unrecognized tax benefits, consistent with FASB ASC Topic 740 (“ASC 740”). The fair value of the intellectual property was determined using an income approach based on unobservable inputs and involves significant judgments such as, but not limited to, future cash flows and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates.
The valuation allowances of $86.8 million and $76.3 million as of December 31, 2025 and 2024, respectively, primarily related to tax basis in certain intangible assets and loss and credit carryovers that are not likely to be realized.
As of December 31, 2025, the Company had state and local tax net operating loss carryforwards of $8.2 million, of which $3.5 million expires within to fifteen years and $4.7 million expires within sixteen years to twenty years. The Company also had state tax credits of $5.0 million, a majority of which will expire in to six years. As of December 31, 2025, the Company had non-U.S. net operating loss carryforwards of $3.1 billion, that can be carried forward indefinitely. In addition, the Company also had foreign tax credit carryforwards of $29.3 million, a majority of which will expire between 2029 and 2035. These amounts have been reduced for associated unrecognized tax benefits, consistent with ASC 740.
The items comprising the differences between the U.S. federal statutory income tax rate and the Company’s effective tax rate on income before income taxes for the years ended December 31 are summarized in the tables below (dollars in thousands).
| 2025 | ||||||||
U.S. federal statutory tax rate | $ | 203,305 | 21.0 | % | ||||
U.S. federal: | ||||||||
Goodwill impairment | 23,560 | 2.4 | ||||||
| Global intangible low-taxed income, net of foreign tax credits | 10,865 | 1.1 | ||||||
Other cross border tax laws | 6,372 | 0.7 | ||||||
Nontaxable or nondeductible items | (152) | — | ||||||
| Tax credits | (4,000) | (0.4) | ||||||
| Change in the valuation allowance | 3,050 | 0.3 | ||||||
Other | (15,099) | (1.6) | ||||||
State and local income tax, net of federal (national) income tax effect (1) | 26,174 | 2.7 | ||||||
Foreign tax effects: | ||||||||
| Ireland | ||||||||
Statutory rate difference between Ireland and United States | (19,967) | (2.1) | ||||||
| Other | (757) | (0.1) | ||||||
| Malta | ||||||||
Statutory rate difference between Malta and United States | (35,315) | (3.6) | ||||||
| Other | (635) | — | ||||||
| Other foreign jurisdictions | 34,961 | 3.6 | ||||||
Changes in unrecognized tax benefits | 6,525 | 0.7 | ||||||
Effective tax rate | $ | 238,887 | 24.7 | % | ||||
(1)State and local income taxes in California, Florida, New York, and Virginia make up the majority (greater than 50 percent) of the tax effects in this category.
| 2024 | 2023 | ||||||||||
| Statutory tax rate | 21.0 | % | 21.0 | % | |||||||
| State income taxes, net of federal benefit | 2.2 | 2.1 | |||||||||
| Effect of non-U.S. operations | (3.0) | (0.4) | |||||||||
| Intercompany sale of intellectual property | (11.8) | — | |||||||||
| Net activity in unrecognized tax benefits | 2.0 | 1.3 | |||||||||
| Stock-based compensation expense | (3.3) | (3.1) | |||||||||
| Limitation on executive compensation | 2.4 | 2.3 | |||||||||
| Global intangible low-taxed income, net of foreign tax credits | 1.1 | 1.2 | |||||||||
| Foreign-derived intangible income | — | (0.3) | |||||||||
| Change in the valuation allowance | (0.1) | (1.2) | |||||||||
| Other items, net | (0.9) | 0.2 | |||||||||
| Effective tax rate | 9.6 | % | 23.1 | % | |||||||
As noted above, in December 2024, the Company completed an intercompany transfer of certain intellectual property. As a result, the Company recorded net tax benefits of approximately $161.9 million. The benefit represents the value of future tax deductions for amortization of the assets in the acquiring jurisdiction, net of any tax recognized by the selling jurisdiction. The Company’s intellectual property footprint continues to evolve and may result in tax rate volatility in the future.
As of December 31, 2025, 2024, and 2023, the Company had gross unrecognized tax benefits of $301.6 million, $257.5 million, and $148.4 million respectively. The increases in 2025 and 2024 are primarily due to positions taken with respect to certain intercompany transactions and tax credits. The gross unrecognized tax benefits at December 31, 2025 related primarily to transfer pricing on intercompany transactions, the exclusion of stock-based compensation expense from the Company’s cost sharing agreement, and the ability to realize certain refund claims.
Included in the balance of gross unrecognized tax benefits at December 31, 2025 are potential benefits of $295.7 million that, if recognized, would reduce our effective tax rate on income from continuing operations. Also included in the balance of gross unrecognized tax benefits at December 31, 2025 are potential benefits of $5.9 million that, if recognized, would result in adjustments to other tax accounts, primarily deferred taxes.
The table below is a reconciliation of the beginning and ending amounts of gross unrecognized tax benefits, excluding interest and penalties, for the years ended December 31 (in thousands).
| 2025 | 2024 | 2023 | |||||||||||||||
| Beginning balance | $ | 257,533 | $ | 148,390 | $ | 137,227 | |||||||||||
| Additions based on tax positions related to the current year | 41,465 | 116,373 | 22,822 | ||||||||||||||
| Reductions based on tax positions related to current year | — | — | — | ||||||||||||||
| Additions for tax positions of prior years | 4,888 | 7,925 | 4,361 | ||||||||||||||
| Reductions for tax positions of prior years | (130) | (888) | (14) | ||||||||||||||
| Reductions for expiration of statutes | (7,911) | (10,573) | (15,625) | ||||||||||||||
| Settlements | — | — | (441) | ||||||||||||||
| Change in foreign currency exchange rates | 5,737 | (3,694) | 60 | ||||||||||||||
| Ending balance | $ | 301,582 | $ | 257,533 | $ | 148,390 | |||||||||||
The Company accrues interest and penalties related to gross unrecognized tax benefits in its income tax provision. As of December 31, 2025, 2024 and 2023, the Company had $25.9 million, $21.1 million and $17.4 million, respectively, of accrued interest and penalties related to gross unrecognized tax benefits. These amounts are in addition to the gross unrecognized tax benefits disclosed above. The total amount of interest and penalties recognized in the income tax provision during 2025 and 2024 was $4.3 million and $5.0 million, respectively.
The number of years with open statutes of limitation varies depending on the tax jurisdiction. The Company’s statutes are open with respect to the U.S. federal jurisdiction for 2022 and forward, India for 2006 and forward, Ireland for 2019 and forward,
and Malta for 2024 and forward. For other major taxing jurisdictions, including U.S. state and local, Saudi Arabia, Germany, United Kingdom, Australia and Netherlands the Company's statutes vary and are open as far back as 2015.
On July 4, 2025, the One Big Beautiful Bill Act (the “OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. OBBBA did not have a material impact on the Company’s consolidated financial results in the current period. The Company is currently assessing and will continue to assess and reflect the impact of OBBBA on its future consolidated financial statements as appropriate.
The Organization for Economic Co-operation and Development (“the OECD”) has issued various proposals that would change long-standing global tax principles. These proposals include a two-pillar approach to global taxation, focusing on global profit allocation and a 15% global corporate minimum tax rate. In January 2026 the OECD issued guidance regarding the 'side-by-side' safe harbor agreement, which is intended to provide relief for U.S. headquartered entities from certain provisions of the global minimum tax framework.
Several countries in which the Company does business have proposed or enacted new laws or are actively considering changes to their tax laws to align with OECD proposals. Significant details around the provisions are still uncertain as the OECD and participating countries continue to work on defining the underlying rules and administrative procedures. The Company will continue to monitor and reflect the impact of such legislative changes in future financial statements as appropriate. The minimum tax has been treated as a current cost since 2024 and does not have a significant impact on the Company’s effective tax rate for the current period.
Under U.S. GAAP, no provision for income taxes that may result from the remittance of earnings held overseas is required if the Company has the ability and intent to indefinitely reinvest such funds overseas. The Company continues to assert its intention to reinvest all accumulated undistributed foreign earnings in its non-U.S. operations, except in instances where the repatriation of those earnings would result in minimal additional tax. Consequently, the Company has not recognized income tax expense that would result from the remittance of those earnings. The accumulated undistributed earnings of non-U.S. subsidiaries that have not been previously taxed were approximately $107.3 million as of December 31, 2025.
The following table summarizes income taxes paid, net of refunds received, for the year ended December 31 (in thousands).
| 2025 | |||||
US federal | $ | 95,586 | |||
| US state and local | 28,595 | ||||
| Foreign | |||||
| United Kingdom | 14,157 | ||||
Other | 71,219 | ||||
| Total Foreign | 85,376 | ||||
Total income taxes, net of refunds received | $ | 209,557 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 15, 2024 | |
| 2022 | Feb 16, 2023 | |
| 2021 | Feb 23, 2022 | |
| 2020 | Feb 24, 2021 | |
| 2019 | Feb 19, 2020 | |
| 2018 | Feb 22, 2019 | |
| 2017 | Feb 22, 2018 | |
| 2016 | Feb 22, 2017 | |
| 2015 | Feb 24, 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.