Match Group, Inc.MTCH
Match Group, Inc. Income Taxes Disclosure
NOTE 3—INCOME TAXES
U.S. and foreign income before income taxes are as follows:
Years Ended December 31, | |||||
2025 | 2024 | 2023 | |||
(In thousands) | |||||
U.S. | $661,835 | $677,842 | $708,333 | ||
Foreign | 84,168 | 26,214 | 68,448 | ||
Total | $746,003 | $704,056 | $776,781 | ||
The components of the income tax provision (benefit) are as follows:
Years Ended December 31, | |||||
2025 | 2024 | 2023 | |||
(In thousands) | |||||
Current income tax provision: | |||||
Federal | $28,990 | $106,510 | $54,523 | ||
State | 12,063 | 18,039 | 16,136 | ||
Foreign | 46,554 | 43,146 | 28,038 | ||
Current income tax provision | 87,607 | 167,695 | 98,697 | ||
Deferred income tax provision (benefit): | |||||
Federal | 43,748 | (2,672) | 33,267 | ||
State | (1,545) | (5,916) | (669) | ||
Foreign | 2,732 | (6,364) | (5,986) | ||
Deferred income tax provision (benefit) | 44,935 | (14,952) | 26,612 | ||
Income tax provision | $132,542 | $152,743 | $125,309 | ||
On July 4, 2025, the U.S. government enacted the One Big Beautiful Bill Act (“the Act”). The Act provides
changes to U.S. federal tax law, including current expensing of U.S. research expenditures, immediate expensing
of eligible capital expenditures, modifications to the limitation of business interest expense, and changes to
other tax provisions impacting 2025 and later years. The provisions of the Act resulted in a reduction of 2025
cash tax payments, and we expect a reduction in the cash tax payments for 2026 as well. Additionally, the 2025
effective tax rate was negatively affected by the passage of the Act, primarily due to a lower deduction for U.S.
income derived from foreign sources as a result of the current expensing of U.S. research expenditures. We
continue to monitor interpretive guidance related to the Act. The impacts of the legislation are reflected in the
consolidated financial statements as of and for the year ended December 31, 2025.
A number of countries have enacted or are actively drafting legislation to implement the Organization for
Economic Cooperation and Development's international tax framework, including the Pillar II minimum tax
regime. The Company analyzed the impact of enacted legislation and determined it does not have a material
impact to the income tax provision. The Company is continuing to monitor future developments, including the
newly-introduced side-by-side safe harbor, which would exclude U.S.-parented multinational enterprises from
the scope of certain Pillar II taxes.
Cash paid for income taxes, net of refunds received, by jurisdiction are as follows:
Years Ended December 31, | |||||
2025 | 2024 | 2023 | |||
(In thousands) | |||||
U.S. Federal | $35,772 | $81,412 | $62,293 | ||
U.S. State and Local | 13,424 | 18,845 | 17,686 | ||
Foreign | |||||
Brazil | 10,159 | 9,480 | 8,181 | ||
Canada | 10,145 | 7,727 | 3,794 | ||
France | 11,557 | 12,819 | 1,311 | ||
Japan | 11,033 | 13,382 | 10,857 | ||
Other | 7,428 | 1,817 | (2,088) | ||
Total Foreign | 50,322 | 45,225 | 22,055 | ||
Total income taxes paid, net of refunds received | $99,518 | $145,482 | $102,034 | ||
The tax effects of cumulative temporary differences that give rise to significant portions of the deferred
tax assets and deferred tax liabilities are presented below. The valuation allowance is primarily related to
deferred tax assets for foreign net operating losses.
December 31, | |||
2025 | 2024 | ||
(In thousands) | |||
Deferred tax assets: | |||
Net operating loss carryforwards | $155,548 | $165,959 | |
Tax credit carryforwards | 49,277 | 71,222 | |
Capitalized research expenses | 99,442 | 127,428 | |
Disallowed interest carryforwards | 14,460 | 6,837 | |
Stock-based compensation | 25,622 | 30,671 | |
Accrued expenses | 36,451 | 19,963 | |
Exchangeable notes | 20,085 | 28,821 | |
Lease liabilities | 27,927 | 24,229 | |
Other | 8,620 | 6,066 | |
Total deferred tax assets | 437,432 | 481,196 | |
Less valuation allowance | (161,210) | (156,710) | |
Deferred tax assets, net of valuation allowance | 276,222 | 324,486 | |
Deferred tax liabilities: | |||
Intangible assets | (41,196) | (45,769) | |
Right-of-use assets | (24,010) | (19,981) | |
Property and equipment | (1,261) | (4,403) | |
Other | (4,430) | (3,546) | |
Total deferred tax liabilities | (70,897) | (73,699) | |
Net deferred tax assets | $205,325 | $250,787 | |
Deferred income tax balances reflect the effects of temporary differences between the carrying amounts of
assets and liabilities and their tax bases and are stated at enacted tax rates expected to be in effect when the
taxes are paid or recovered.
At December 31, 2025, the Company has federal and state net operating losses (“NOLs”) of $5.0 million
and $141.2 million, respectively. While subject to limitation under Section 382 of the Internal Revenue code,
federal NOLs of $5.0 million are expected to be used through 2037. Of the state NOLs, $1.3 million can be carried
forward indefinitely and $139.9 million will expire at various times between 2026 and 2045. State NOLs of
$100.4 million can be used against future taxable income without restriction and the remaining NOLs are subject
to separate return limitations under applicable state law. At December 31, 2025, the Company has foreign NOLs
of $625.4 million available to offset future income. Of these foreign NOLs, $108.9 million can be carried forward
indefinitely and $516.5 million will expire at various times between 2026 and 2042. Foreign NOLs of
$564.6 million can be used against future taxable income without restriction and the remaining NOLs are subject
to limitation under each respective taxing jurisdiction’s law. During 2025, the Company recognized tax benefits
related to NOLs of $1.1 million. At December 31, 2025, the Company has foreign disallowed interest
carryforwards of $51.7 million that can be carried forward indefinitely and can be used against future taxable
income.
At December 31, 2025, the Company has tax credit carryforwards of $65.3 million. Of this amount, $63.6
million relates to state and foreign tax credits for research activities, of which $6.3 million will expire at various
times between 2032 and 2045. Additionally, the Company has $1.7 million of other credits, primarily consisting
of foreign employment tax credits which expire at various times between 2031 and 2032.
The Company regularly assesses the realizability of deferred tax assets considering all available evidence,
including, to the extent applicable, the nature, frequency, and severity of prior cumulative losses, forecasts of
future taxable income, tax filing status, the duration of statutory carryforward periods, available tax planning
and historical experience.
During the year ended December 31, 2025, we recorded a $4.5 million net increase to the valuation
allowance, primarily related to an increase in the foreign disallowed interest carryforwards. At December 31,
2025, the Company had a valuation allowance of $161.2 million related to the portion of NOLs, credits, and other
deferred tax assets for which it is more likely than not that the tax benefit will not be realized.
A reconciliation of the U.S. federal statutory income tax rate to our effective tax rate is as follows:
Years Ended December 31, | |||||||||||
2025 | 2024 | 2023 | |||||||||
(In thousands) | |||||||||||
Income tax provision at the federal statutory rate | $156,661 | 21.0% | $147,852 | 21.0% | $163,124 | 21.0% | |||||
State income taxes, net of federal benefit(a) | 7,539 | 1.0% | 15,866 | 2.3% | 11,955 | 1.5% | |||||
Foreign tax effects | |||||||||||
Brazil | 10,449 | 1.4% | 9,352 | 1.3% | 7,956 | 1.0% | |||||
Canada | |||||||||||
Change in valuation allowance | 6,344 | 0.9% | 7,521 | 1.1% | — | —% | |||||
Other | 4,239 | 0.6% | 5,300 | 0.8% | 1,007 | 0.1% | |||||
Other foreign jurisdictions | 11,171 | 1.5% | 11,239 | 1.6% | 4,817 | 0.6% | |||||
Effect of cross-border tax laws | |||||||||||
Foreign derived intangible income deduction | (39,579) | (5.3)% | (41,392) | (5.9)% | (38,730) | (5.0)% | |||||
Foreign tax credits | (14,171) | (1.9)% | (9,414) | (1.3)% | (7,950) | (1.0)% | |||||
Other | 186 | —% | 162 | —% | — | —% | |||||
Tax credits | |||||||||||
Research credits | (14,569) | (2.0)% | (9,761) | (1.4)% | (11,380) | (1.5)% | |||||
Change in valuation allowance | 185 | —% | — | —% | (31,251) | (4.0)% | |||||
Nontaxable or nondeductible items | |||||||||||
Stock-based compensation | 1,081 | 0.1% | 18,950 | 2.7% | 28,245 | 3.6% | |||||
Other | 1,919 | 0.3% | 4,007 | 0.6% | 1,348 | 0.2% | |||||
Changes in uncertain tax positions | 1,087 | 0.1% | (6,939) | (1.0)% | (3,832) | (0.5)% | |||||
Income tax provision | $132,542 | 17.8% | $152,743 | 21.7% | $125,309 | 16.1% | |||||
______________________
(a)The majority (greater than 50%) of the tax effect in this category was made up of New Jersey, New York,
and New York City in 2025; Illinois, New Jersey, New York, New York City, and Pennsylvania in 2024; and
California, Illinois, New Jersey, New York, Pennsylvania and South Carolina in 2023.
The 2025 income tax provision was impacted by benefits from a lower tax rate on U.S. income derived
from foreign sources and research credits.
The 2024 income tax provision was impacted by nondeductible stock-based compensation and state
income taxes partially offset by benefits from a lower tax rate on U.S. income derived from foreign sources and
research credits.
The 2023 income tax provision benefited primarily from (i) the release of a valuation allowance associated
with U.S. foreign tax credits that we now expect to utilize, (ii) a lower tax rate on U.S. income derived from
foreign sources, and (iii) the generation of research credits. These benefits were partially offset by state income
taxes and nondeductible stock-based compensation.
A reconciliation of the beginning and ending amount of unrecognized tax benefits, including penalties but
excluding interest, is as follows:
December 31, | |||||
2025 | 2024 | 2023 | |||
(In thousands) | |||||
Balance at January 1 | $48,664 | $45,047 | $43,340 | ||
Additions based on tax positions related to the current year | 11,402 | 13,166 | 7,397 | ||
Additions for tax positions of prior years | 8,272 | 921 | 4,532 | ||
Reductions for tax positions of prior years | (7,533) | (58) | (615) | ||
Settlements | (279) | (9,615) | (852) | ||
Expiration of applicable statute of limitations | (98) | (797) | (8,755) | ||
Balance at December 31 | $60,428 | $48,664 | $45,047 | ||
The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in the
income tax provision. Our income tax provision for each of the years ended December 31, 2025, 2024, and 2023,
includes an increase (decrease) of interest and penalties of $2.0 million, $0.7 million, and $(0.3) million,
respectively. At December 31, 2025 and 2024, noncurrent income taxes payable include accrued interest and
penalties of $3.6 million and $1.6 million, respectively.
Match Group is routinely under audit by federal, state, local, and foreign authorities in the area of income
tax. These audits include questioning the timing and the amount of income and deductions and the allocation of
income and deductions among various tax jurisdictions. The Internal Revenue Service (“IRS”) has substantially
completed its audit of the Company’s federal income tax returns for years through December 31, 2019. Although
the 2020 and 2021 tax years are closed to assessment, adjustments to taxable income may still be made if it
impacts net operating loss or credit carryforwards coming out of that year. Returns filed in various other
jurisdictions are open to examination for tax years beginning with 2015. Although we believe that we have
adequately reserved for our uncertain tax positions, the final tax outcome of these matters may vary significantly
from our estimates.
At December 31, 2025 and 2024, unrecognized tax benefits, including interest, were $64.0 million and
$50.3 million, respectively. If unrecognized tax benefits at December 31, 2025 are subsequently recognized,
$58.5 million, net of related interest, would reduce income tax expense. The comparable amount as of
December 31, 2024 was $46.6 million.
Generally, our ability to distribute the $339.9 million cash and cash equivalents held by our foreign
subsidiaries at December 31, 2025 is limited to that subsidiary’s distributable reserves and after considering
other corporate legal restrictions. To the extent distributable from earnings, most foreign cash can be
repatriated without significant tax costs. The remaining excess of the amount for financial reporting over the tax
basis of investments in foreign subsidiaries is indefinitely reinvested, and the determination of any deferred tax
liability on this amount is not practicable.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 23, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Mar 1, 2019 | |
| 2017 | Mar 1, 2018 | |
| 2016 | Feb 28, 2017 | |
| 2015 | Feb 29, 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.