LendingClub CorpLC
LendingClub Corp Income Taxes Disclosure
Income Taxes
Income tax expense (benefit) consisted of the following:
| Year Ended December 31, | 2025 | 2024 | 2023 | ||||||||||||||
| Current: | |||||||||||||||||
| Federal | $ | 1,854 | $ | 316 | $ | 3,180 | |||||||||||
| State | 1,972 | 2,551 | (5,060) | ||||||||||||||
| Total current tax expense (benefit) | 3,826 | 2,867 | (1,880) | ||||||||||||||
| Deferred: | |||||||||||||||||
| Federal | 27,486 | 10,997 | 11,427 | ||||||||||||||
| State | 9,957 | (128) | 6,131 | ||||||||||||||
Total deferred expense | 37,443 | 10,869 | 17,558 | ||||||||||||||
Income tax expense | $ | 41,269 | $ | 13,736 | $ | 15,678 | |||||||||||
The table below presents a reconciliation of the income tax expense at the statutory federal income tax rate to the income tax expense at the effective income tax rate:
| Year Ended December 31, | 2025 | 2024 | 2023 | ||||||||||||||||||||||||||||||||
U.S. federal statutory tax rate | $ | 37,159 | 21.00 | % | $ | 13,664 | 21.00 | % | $ | 11,470 | 21.00 | % | |||||||||||||||||||||||
State and local income tax, net of federal tax income effect (1) | 9,772 | 5.52 | % | 2,392 | 3.68 | % | 903 | 1.65 | % | ||||||||||||||||||||||||||
Change in unrecognized tax benefits | (1,662) | (0.94) | % | 1,779 | 2.73 | % | 1,380 | 2.53 | % | ||||||||||||||||||||||||||
Tax credits: | |||||||||||||||||||||||||||||||||||
| Research and development tax credits | (4,319) | (2.44) | % | (5,931) | (9.12) | % | (4,600) | (8.42) | % | ||||||||||||||||||||||||||
Nontaxable or nondeductible items: | |||||||||||||||||||||||||||||||||||
(Windfalls) Shortfalls related to equity compensation | (1,805) | (1.02) | % | (610) | (0.94) | % | 4,280 | 7.84 | % | ||||||||||||||||||||||||||
Nondeductible portion of executive compensation | 2,583 | 1.46 | % | 3,313 | 5.09 | % | 2,230 | 4.08 | % | ||||||||||||||||||||||||||
Other | 20 | 0.01 | % | (3) | — | % | (141) | (0.26) | % | ||||||||||||||||||||||||||
Other adjustments: | |||||||||||||||||||||||||||||||||||
| Benefit from intraperiod tax allocation | (481) | (0.27) | % | (868) | (1.33) | % | — | — | % | ||||||||||||||||||||||||||
Other | 2 | — | % | — | — | % | 156 | 0.29 | % | ||||||||||||||||||||||||||
Effective income tax rate | $ | 41,269 | 23.32 | % | $ | 13,736 | 21.11 | % | $ | 15,678 | 28.71 | % | |||||||||||||||||||||||
(1) The states that contribute to the majority (greater than 50%) of the tax effect in this category include California, Illinois, New Jersey and New York for 2025; California, Illinois, Massachusetts, New Jersey and New York for 2024; and California for 2023.
Cash paid for income taxes, net of refunds, are as follows:
| Year Ended December 31, | 2025 | 2024 | 2023 | ||||||||||||||
Federal | $ | 1,950 | $ | — | $ | 1,625 | |||||||||||
State: | |||||||||||||||||
Illinois | * | * | 1,406 | ||||||||||||||
New Jersey | * | * | 1,021 | ||||||||||||||
Georgia | * | * | 591 | ||||||||||||||
New York | 185 | 124 | * | ||||||||||||||
| New York MCTD | * | 48 | * | ||||||||||||||
Texas | 380 | 132 | * | ||||||||||||||
New York City | * | 119 | * | ||||||||||||||
Oregon | * | 96 | * | ||||||||||||||
Pennsylvania | * | 15 | * | ||||||||||||||
Utah | * | (160) | (519) | ||||||||||||||
Colorado | * | (94) | * | ||||||||||||||
Other | 862 | (5) | 2,507 | ||||||||||||||
Total State | 1,427 | 275 | 5,006 | ||||||||||||||
Income taxes, net of amounts refunded | $ | 3,377 | $ | 275 | $ | 6,631 | |||||||||||
* The amount of income taxes paid during the year does not meet the 5% disaggregation threshold and is included in “Other.”
The significant components of the Company’s net deferred tax assets were as follows:
| December 31, | 2025 | 2024 | |||||||||
Deferred tax assets: | |||||||||||
Allowance for loan and lease losses | $ | 67,876 | $ | 64,925 | |||||||
Net operating loss carryforwards | 40,327 | 54,981 | |||||||||
| Tax credit carryforwards | 34,706 | 31,416 | |||||||||
| Reserves and accruals | 13,584 | 13,699 | |||||||||
| Deferred compensation | 7,862 | 9,862 | |||||||||
| Goodwill | 5,671 | 8,244 | |||||||||
| Unrealized loss on AFS securities | 5,545 | 9,096 | |||||||||
| Operating lease liabilities | 3,818 | 7,649 | |||||||||
| Stock-based compensation | 3,279 | 4,849 | |||||||||
| Other | 2,892 | 3,187 | |||||||||
| Gross deferred tax assets | 185,560 | 207,908 | |||||||||
| Valuation allowance | (48,047) | (46,325) | |||||||||
| Total deferred tax assets | $ | 137,513 | $ | 161,583 | |||||||
| Deferred tax liabilities: | |||||||||||
Internally-developed software | $ | (27,634) | $ | (5,280) | |||||||
| Leases | (7,817) | (11,283) | |||||||||
| Operating lease assets | (3,122) | (5,717) | |||||||||
| Servicing assets | (415) | (1,708) | |||||||||
| Other | (2,366) | (440) | |||||||||
| Total deferred tax liabilities | $ | (41,354) | $ | (24,428) | |||||||
| Deferred tax assets, net | $ | 96,159 | $ | 137,155 | |||||||
As of December 31, 2025 and 2024, the Company maintained a valuation allowance of $48.0 million and $46.3 million, respectively, solely related to certain state net operating loss carryforwards (NOLs) and state tax credit carryforwards.
The table below provides information about the Company’s NOLs and tax credit carryforwards by jurisdiction:
| December 31, 2025 | Expiration | ||||||||||
Tax loss carryforwards (1): | |||||||||||
Net operating loss – federal | $ | — | Indefinite | ||||||||
Net operating loss – state | $ | 483,357 | 2030 - 2042 | ||||||||
Net operating loss – state | $ | 41,195 | Indefinite | ||||||||
Tax credit carryforwards (1): | |||||||||||
Research and development credits – federal | $ | 35,542 | 2037 - 2045 | ||||||||
Research and development credits – state | $ | 22,545 | Indefinite | ||||||||
(1) The carryforwards, net of the valuation allowance for certain states, are expected to be fully utilized prior to expiration.
The table below presents a reconciliation of total unrecognized tax benefits:
| Year Ended December 31, | 2025 | 2024 | 2023 | ||||||||||||||
Unrecognized tax benefits at beginning of year | $ | 33,073 | $ | 30,062 | $ | 27,850 | |||||||||||
| Gross increase (decrease) – tax positions related to prior years | (6,195) | 671 | (161) | ||||||||||||||
| Gross increase – tax positions related to current year | 2,310 | 2,340 | 2,373 | ||||||||||||||
Unrecognized tax benefits at end of year | $ | 29,188 | $ | 33,073 | $ | 30,062 | |||||||||||
As of December 31, 2025 and 2024, $20.7 million and $22.4 million, respectively, of unrecognized tax benefits, if recognized, would impact the Company’s effective tax rate. The Company had $0.4 million accrued for the payment of interest and penalties related to unrecognized tax benefits as of December 31, 2025 and 2024.
The Company files income tax returns in the United States and various state jurisdictions. As of December 31, 2025, the Company’s federal tax returns for 2021 and earlier, and state tax returns for 2020 and earlier were no longer subject to examination by the taxing authorities. However, tax credit carryforwards from closed periods may be subject to audit and re-examination by tax authorities when utilized in subsequent years.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 16, 2024 | |
| 2022 | Feb 9, 2023 | |
| 2021 | Feb 11, 2022 | |
| 2020 | Mar 11, 2021 | |
| 2019 | Feb 19, 2020 | |
| 2018 | Feb 20, 2019 | |
| 2017 | Feb 22, 2018 | |
| 2016 | Feb 28, 2017 | |
| 2015 | Feb 22, 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.