OXFORD INDUSTRIES INCOXM
OXFORD INDUSTRIES INC Income Taxes Disclosure
Income Taxes
The following table summarizes our distribution between domestic and foreign earnings (loss) before income taxes and the provision (benefit) for income taxes (in thousands):
| Fiscal 2025 | Fiscal 2024 | Fiscal 2023 | |||||||||||||||
| Earnings (loss) before income taxes: | |||||||||||||||||
| Domestic | $ | (41,924) | $ | 110,862 | $ | 62,772 | |||||||||||
| Foreign | 3,770 | 5,706 | 12,174 | ||||||||||||||
| Earnings (loss) before income taxes | $ | (38,154) | $ | 116,568 | $ | 74,946 | |||||||||||
| Income tax expense (benefit): | |||||||||||||||||
| Current tax expense (benefit): | |||||||||||||||||
| Federal | $ | (634) | $ | 14,229 | $ | 28,183 | |||||||||||
| State | 3,657 | 4,848 | 7,530 | ||||||||||||||
| Foreign | 319 | 825 | 2,419 | ||||||||||||||
| Total current tax expense (benefit) | 3,342 | 19,902 | 38,132 | ||||||||||||||
| Deferred tax expense (benefit): | |||||||||||||||||
| Federal | (8,052) | 2,546 | (19,348) | ||||||||||||||
| State | (5,273) | 1,017 | (4,735) | ||||||||||||||
| Foreign | $ | (282) | $ | 130 | $ | 194 | |||||||||||
| Total deferred tax expense (benefit) | (13,607) | 3,693 | (23,889) | ||||||||||||||
| Income tax expense (benefit) | $ | (10,265) | $ | 23,595 | $ | 14,243 | |||||||||||
We adopted ASU 2023-09 prospectively in Fiscal 2025. See Note 1 — Business and Summary of Significant Accounting Policies for additional details on the adoption of ASU 2023-09. Our effective tax rate, as updated for ASC 2023-09, differed from the federal statutory rate for Fiscal 2025 as follows:
| Fiscal 2025 | ||||||||
| Amount (in thousands) | Percentage | |||||||
| Pre-tax book income | $ | (38,154) | ||||||
| U.S. federal statutory tax rate | (8,013) | 21.0 | % | |||||
State and local income tax, net of federal (national) income tax effect (1) | (2,370) | 6.2 | % | |||||
| Foreign tax effects | 57 | (0.2 | %) | |||||
| Effect of changes in tax laws or rates enacted in the current period: | (236) | 0.6 | % | |||||
| Effect of changes in cross-border tax laws: | 230 | (0.6 | %) | |||||
| Tax credits | ||||||||
| FICA tax credit | (1,429) | 3.8 | % | |||||
| R&D tax credit | (922) | 2.4 | % | |||||
| Nontaxable or nondeductible items | ||||||||
| Nondeductible stock compensation | 1,240 | (3.3 | %) | |||||
| Excess tax detriment, restricted stock vesting | 1,239 | (3.3 | %) | |||||
| Key-man life, NQDC funding | (400) | 1.1 | % | |||||
| Other | 170 | (0.4 | %) | |||||
| Change in unrecognized tax benefits | (148) | 0.4 | % | |||||
| Other | 317 | (0.8 | %) | |||||
| Effective tax rate | $ | (10,265) | 26.9 | % | ||||
(1)State Taxes in the following states make up more than 50% of the tax effect in this category for 2025: California, Pennsylvania, Florida, Hawaii and Massachusetts.
Our effective tax rate, prior to the adoption of ASU 2023-09, differed from the federal statutory rate for Fiscal 2024 and Fiscal 2023 as follows:
| Fiscal 2024 | Fiscal 2023 | ||||||||||
| Statutory federal income tax rate | 21.0 | % | 21.0 | % | |||||||
State income taxes—net of federal income tax benefit (1) | 3.7 | % | 1.6 | % | |||||||
| Change in reserve for uncertain tax positions & method change | 1.7 | % | 1.5 | % | |||||||
| Impact of foreign operations rate differential | 0.1 | % | 0.3 | % | |||||||
| U.S. federal tax credits | (4.5 | %) | (3.0 | %) | |||||||
| Rate benefit, NOL carryback interest | (1.7 | %) | — | % | |||||||
| Impact of prior year true-ups | (1.3 | %) | (1.9 | %) | |||||||
| Excess Tax Benefit, Restricted Stock Vesting | (0.3 | %) | (1.6 | %) | |||||||
| Impact of valuation allowances related to operating losses | — | % | (0.9 | %) | |||||||
| Other, net | 1.5 | % | 2.0 | % | |||||||
| Effective tax rate | 20.2 | % | 19.0 | % | |||||||
Deferred tax assets and liabilities included in our consolidated balance sheets are comprised of the following (in thousands):
| January 31, 2026 | February 1, 2025 | ||||||||||
| Deferred Tax Assets: | |||||||||||
| Inventories | $ | 21,905 | $ | 21,124 | |||||||
| Accrued compensation and benefits | 12,981 | 12,361 | |||||||||
| Receivable allowances and reserves | 2,757 | 1,823 | |||||||||
| Operating lease liabilities | 108,317 | 101,719 | |||||||||
| Operating loss and other carry-forwards | 5,511 | 706 | |||||||||
| Acquired intangible assets | 6,012 | — | |||||||||
| Other, net | 2,213 | 6,531 | |||||||||
| Total deferred tax assets | 159,696 | 144,264 | |||||||||
| Deferred Tax Liabilities: | |||||||||||
| Operating lease assets | (101,172) | (97,732) | |||||||||
| Depreciation and amortization | (21,223) | (18,343) | |||||||||
| Acquired intangible assets | — | (5,547) | |||||||||
| Total deferred tax liabilities | (122,395) | (121,622) | |||||||||
| Valuation allowance | (3,137) | (2,322) | |||||||||
| Total net deferred tax asset | $ | 34,164 | $ | 20,320 | |||||||
As of January 31, 2026, our U.S. federal net operating loss carryforward was $10 million, which does not expire, and our state net operating loss carryforwards were $48 million, the majority of which will begin to expire in 2036 or after if not utilized.
The majority of our valuation allowance of $3 million and $2 million as of January 31, 2026 and February 1, 2025, respectively, relates to our capital loss carry-forwards. The amount of the valuation allowance could change in the future if our operating results or estimates of future taxable operating results changes.
Accounting for income taxes requires that we offset deferred tax liabilities and assets within each tax jurisdiction and present the net deferred tax amount for each jurisdiction as a net deferred tax amount in our consolidated balance sheets. The amounts of deferred income taxes included in our consolidated balance sheets are as follows (in thousands):
| January 31, 2026 | February 1, 2025 | ||||||||||
| Deferred tax assets | $ | 34,164 | $ | 20,320 | |||||||
| Deferred tax liabilities | $ | — | $ | — | |||||||
| Net deferred tax asset | $ | 34,164 | $ | 20,320 | |||||||
U.S. tax regulations currently include certain tax provisions including a tax on global intangible low-taxed income (“GILTI”), disallowance of deductions for certain payments (the base erosion anti-abuse tax, or “BEAT”) and certain deductions enacted for certain foreign-derived intangible income (“FDII”). While the calculations for GILTI, BEAT and FDII are complex calculations, these provisions did not have a material impact on our effective tax rate in Fiscal 2025, Fiscal 2024 and Fiscal 2023. We recognize the impact of GILTI as a period cost.
We continue to assert that our investments in substantially all of our foreign subsidiaries and substantially all of the related earnings are permanently reinvested outside the United States. We believe that any other taxes such as foreign withholding or U.S. state tax payable would be immaterial if we were to repatriate the foreign earnings. Therefore, we have not recorded any deferred tax liabilities related to these foreign investments and earnings in our consolidated balance sheets as of January 31, 2026 and February 1, 2025.
Cash paid for income taxes, net of refunds received, by jurisdiction (in thousands):
| Fiscal 2025 | |||||
| Federal Taxes Paid | $ | 4,668 | |||
| State Taxes Paid | |||||
| Florida | 918 | ||||
| California | 863 | ||||
| Other | 2,934 | ||||
| Foreign Taxes Paid | |||||
| Hong Kong | 1,070 | ||||
| Australia | 635 | ||||
| Other | 18 | ||||
| Total Income Taxes Paid (Net of Refunds Received) | $ | 11,106 | |||
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law, introducing several significant U.S. federal income tax provisions. These provisions reduced our U.S. federal cash tax payments following enactment for the remainder of fiscal 2025 and are expected to impact future periods. The provisions include immediate expensing of domestic research and development costs and accelerated bonus depreciation for certain qualified property placed in service after January 19, 2025.
As a result of our election under the OBBBA to accelerate first-year depreciation and Section 174 expenses, we generated a net operating loss carryforward, which gave rise to a deferred tax asset. The deferred tax asset reflects the expected future tax benefit of the loss carryforward and was evaluated for realizability in accordance with ASC 740.
In addition, certain general business credits generated during Fiscal 2025 are expected to be carried back, resulting in the recognition of a current income tax receivable during Fiscal 2025. The income tax receivable also includes estimated federal income tax payments made during Fiscal 2025 prior to enactment of the OBBBA.
A reconciliation of the changes in the gross amount of unrecognized tax benefits, which are included in other non-current liabilities, is as follows (in thousands):
| Fiscal 2025 | Fiscal 2024 | Fiscal 2023 | |||||||||||||||
| Balance of unrecognized tax benefits at beginning of year | $ | 5,643 | $ | 3,710 | $ | 3,664 | |||||||||||
| Increase related to prior period tax positions | 1,019 | — | 233 | ||||||||||||||
| Decrease related to prior period tax positions | (1,313) | (13) | (2,027) | ||||||||||||||
| Increase related to current period tax positions | 478 | 2,166 | 1,940 | ||||||||||||||
| Decrease related to settlements with taxing authorities | (491) | — | — | ||||||||||||||
| Decrease related to lapse of statute of limitations | (506) | (220) | (100) | ||||||||||||||
| Balance of unrecognized tax benefits at end of year | $ | 4,830 | $ | 5,643 | $ | 3,710 | |||||||||||
Approximately $3 million of our uncertain tax positions as of January 31, 2026, if recognized, would reduce the future effective tax rate in the period settled. The total amount of unrecognized tax benefits relating to our tax positions is subject to change based on future events including, but not limited to, settlements of ongoing audits and assessments and the expiration of applicable statutes of limitation. The ultimate occurrence, outcomes, and timing of such events could differ from our current expectations. Interest and penalties associated with unrecognized tax positions are recorded within income tax expense in our consolidated statements of operations. During each of Fiscal 2025, Fiscal 2024 and Fiscal 2023, we recognized less than $1 million of interest and penalties associated with unrecognized tax positions in our consolidated statements of operations.
We file income tax returns in the United States and various state, local and foreign jurisdictions. Our federal, state, local and foreign income tax returns filed for years prior to Fiscal 2022, with limited exceptions, are no longer subject to examination by tax authorities.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Mar 27, 2026 | Showing above |
| 2025 | Mar 31, 2025 | |
| 2024 | Apr 1, 2024 | |
| 2023 | Mar 28, 2023 | |
| 2022 | Mar 28, 2022 | |
| 2021 | Mar 29, 2021 | |
| 2020 | Mar 30, 2020 | |
| 2019 | Apr 1, 2019 | |
| 2018 | Apr 2, 2018 | |
| 2017 | Mar 28, 2017 | |
| 2016 | Mar 28, 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.