Prologis, Inc. Income Taxes Disclosure
NOTE 12. INCOME TAXES
Components of Earnings Before Income Taxes
The following table summarizes the components of earnings before income taxes for the years ended December 31 (in thousands):
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Domestic |
|
$ |
3,539,450 |
|
|
$ |
3,595,449 |
|
|
$ |
2,891,644 |
|
International |
|
|
229,866 |
|
|
|
519,429 |
|
|
|
572,539 |
|
Earnings before income taxes |
|
$ |
3,769,316 |
|
|
$ |
4,114,878 |
|
|
$ |
3,464,183 |
|
Summary of Current and Deferred Income Taxes
The following table summarizes the components of the provision for income taxes for the years ended December 31 (in thousands):
|
|
2025 |
|
|
2024 |
|
|
2023 |
|
|||
Current income tax expense (benefit): |
|
|
|
|
|
|
|
|
|
|||
U.S. federal |
|
$ |
36,003 |
|
|
$ |
(17,082 |
) |
|
$ |
(953 |
) |
International |
|
|
148,169 |
|
|
|
152,891 |
|
|
|
175,121 |
|
State and local |
|
|
15,536 |
|
|
|
9,973 |
|
|
|
19,162 |
|
Total current income tax expense |
|
|
199,708 |
|
|
|
145,782 |
|
|
|
193,330 |
|
|
|
|
|
|
|
|
|
|
|
|||
Deferred income tax expense (benefit): |
|
|
|
|
|
|
|
|
|
|||
U.S. federal |
|
|
(4,571 |
) |
|
|
18,222 |
|
|
|
12,936 |
|
International |
|
|
8,880 |
|
|
|
2,939 |
|
|
|
4,772 |
|
Total deferred income tax expense |
|
|
4,309 |
|
|
|
21,161 |
|
|
|
17,708 |
|
Total income tax expense |
|
$ |
204,017 |
|
|
$ |
166,943 |
|
|
$ |
211,038 |
|
Current Income Taxes
We recognize current income tax expense for the federal and state income taxes incurred by our TRSs and taxes incurred in certain states and foreign jurisdictions. Current income tax expense fluctuates from period to period based primarily on the timing of our taxable income. Taxable income incurred over the last three years was principally due to the following: (i) the contribution of real estate properties to our unconsolidated co-investment ventures and sales to third parties; (ii) recurring and transactional strategic capital fees earned; (iii) taxable earnings from unconsolidated co-investment ventures; and (iv) adjustments to acquired tax liabilities.
During the years ended December 31, 2025, 2024 and 2023, cash paid for income taxes, net of refunds, was $142.7 million, $129.9 million and $149.1 million, respectively. The composition of these payments is generally consistent with the components of current income tax expense (benefit) as presented above.
Deferred Income Taxes
The deferred income tax expense recognized in 2025, 2024 and 2023 was principally due to changes in temporary differences and utilization of NOLs.
The following table summarizes the deferred income tax assets and liabilities at December 31 (in thousands):
|
|
2025 |
|
|
2024 |
|
||
Gross deferred income tax assets: |
|
|
|
|
|
|
||
NOL carryforwards |
|
$ |
281,664 |
|
|
$ |
263,597 |
|
Basis difference – real estate properties |
|
|
53,824 |
|
|
|
43,226 |
|
Basis difference – equity investments |
|
|
20,594 |
|
|
|
18,434 |
|
Section 163(j) interest limitation |
|
|
2,250 |
|
|
|
2,105 |
|
Capital loss carryforward |
|
|
2,033 |
|
|
|
6,096 |
|
Other – temporary differences |
|
|
61,021 |
|
|
|
29,908 |
|
Total gross deferred income tax assets |
|
|
421,386 |
|
|
|
363,366 |
|
Valuation allowance |
|
|
(366,990 |
) |
|
|
(312,348 |
) |
Gross deferred income tax assets, net of valuation allowance |
|
|
54,396 |
|
|
|
51,018 |
|
Gross deferred income tax liabilities: |
|
|
|
|
|
|
||
Basis difference – real estate properties |
|
|
133,095 |
|
|
|
128,803 |
|
Basis difference – equity investments |
|
|
63,066 |
|
|
|
57,763 |
|
Other – temporary differences |
|
|
6,573 |
|
|
|
2,321 |
|
Total gross deferred income tax liabilities |
|
|
202,734 |
|
|
|
188,887 |
|
Net deferred income tax liabilities |
|
$ |
148,338 |
|
|
$ |
137,869 |
|
At December 31, 2025, we had NOL carryforwards as follows (in thousands):
|
U.S. |
|
|
Europe |
|
|
Mexico |
|
|
Japan |
|
|
Other |
|
|||||
Gross NOL carryforward |
$ |
78,175 |
|
|
$ |
683,143 |
|
|
$ |
216,909 |
|
|
$ |
67,119 |
|
|
$ |
33,789 |
|
Tax-effected NOL carryforward |
|
20,255 |
|
|
|
179,267 |
|
|
|
68,531 |
|
|
|
7,953 |
|
|
|
5,658 |
|
Valuation allowance |
|
(20,255 |
) |
|
|
(164,021 |
) |
|
|
(68,531 |
) |
|
|
(7,953 |
) |
|
|
(5,658 |
) |
Net deferred tax asset – NOL carryforward |
$ |
- |
|
|
$ |
15,246 |
|
|
$ |
- |
|
|
$ |
- |
|
|
$ |
- |
|
Expiration periods |
2026 – 2045 |
|
|
2026 – indefinite |
|
|
2026 – 2035 |
|
|
2026 – 2035 |
|
|
2026 – indefinite |
|
|||||
The deferred tax asset valuation allowance at December 31, 2025, was adequate to reduce the total deferred tax asset to an amount that we estimate will more likely than not be realized.
Liability for Uncertain Tax Positions
During the years ended December 31, 2025, 2024 and 2023, we believe that we complied with the REIT requirements of the IRC. The statute of limitations for our global tax returns is generally three to five years. As such, our tax returns that remain subject to examination would be primarily from 2020 and thereafter. During the year ended December 31, 2024, we recognized a $20.7 million liability for uncertain tax positions related to proposed settlements. Liabilities or any related settlements for uncertain tax positions for the years ended December 31, 2025 and 2023 were not material to our Consolidated Financial Statements.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 14, 2025 | |
| 2023 | Feb 13, 2024 | |
| 2022 | Feb 14, 2023 | |
| 2021 | Feb 9, 2022 | |
| 2020 | Feb 11, 2021 | |
| 2019 | Feb 11, 2020 | |
| 2018 | Feb 13, 2019 | |
| 2017 | Feb 15, 2018 | |
| 2016 | Feb 15, 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.