RMR GROUP INC.RMR

RMR GROUP INC. Income Taxes Disclosure

10-KFiled Nov 12, 20253 min read
Income Taxes
We are the sole managing member of RMR LLC. We are a corporation subject to U.S. federal and state income tax with respect to our allocable share of any taxable income of RMR LLC and its tax consolidated subsidiaries. RMR LLC is treated as a partnership for U.S. federal and most applicable state and local income tax purposes. As a partnership, RMR LLC is generally not subject to U.S. federal and most state income taxes. Any taxable income or loss generated by RMR LLC is passed through to and included in the taxable income or loss of its members, including RMR Inc. and ABP Trust, based on each member’s respective ownership percentage. During the fiscal years ended September 30, 2025, 2024 and 2023, all of our income before taxes was derived solely from domestic operations.
We had a provision (benefit) for income taxes which consists of the following:
Fiscal Year Ended September 30,
202520242023
Current:
Federal$4,188 $4,912 $16,922 
State1,501 3,350 5,954 
Deferred:
Federal1,335 2,248 (940)
State647 809 (168)
Total$7,671 $11,319 $21,768 
A reconciliation of the statutory income tax rate to the effective tax rate is as follows:
 Fiscal Year Ended September 30,
 202520242023
Income taxes computed at the federal statutory rate21.0 %21.0 %21.0 %
State taxes, net of federal benefit3.6 %3.4 %3.0 %
Permanent items1.2 %1.1 %0.5 %
Uncertain tax position reserve, net of federal benefit0.3 %1.9 %— %
Net income attributable to noncontrolling interest(9.5)%(9.8)%(9.9)%
Total16.6 %17.6 %14.6 %
The components of the deferred tax assets as of September 30, 2025 and 2024 are entirely comprised of the outside basis difference in our partnership interest in RMR LLC.
ASC 740, Income Taxes, provides a model for how a company should recognize, measure and present in its financial statements uncertain tax positions that have been taken or are expected to be taken with respect to all open years and in all significant jurisdictions. Pursuant to this topic, we recognize a tax benefit only if it is “more likely than not” that a particular tax position will be sustained upon examination or audit. To the extent the “more likely than not” standard has been satisfied, the benefit associated with a tax position is measured as the largest amount that is greater than 50.0% likely to be realized upon settlement. 
We continue to be subject to federal, state, and local income tax audit examinations for open periods, which can lead to adjustments to our provision for income taxes, the resolution of which may be highly uncertain. We have accrued an uncertain tax position reserve related to an ongoing examination with a state jurisdiction for the fiscal years ending September 30, 2019 and thereafter, the impact of which is not significant to the overall financial statements. Our policy is to include interest expense related to unrecognized tax benefits within the provision for income taxes in our consolidated statements of comprehensive income.
As of September 30, 2025 and 2024, our gross unrecognized tax benefit from uncertain tax positions, exclusive of interest expense, was $1,527 and $1,449, respectively, of which $78 and $107, respectively, is based on positions related to the fiscal years ended September 30, 2025 and 2024, respectively. As of September 30, 2025 and 2024, we recognized $146 and $252, respectively, for interest expense related to unrecognized tax benefits and had $1,925 and $1,701, respectively, of gross unrecognized tax benefits. As of September 30, 2023, we had no uncertain tax positions. We do not reasonably expect any significant changes relating to our unrecognized tax benefits within the next twelve months.
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Historical Timeline

Fiscal YearFiled
2025Nov 12, 2025Showing above
2024Nov 12, 2024
2023Nov 15, 2023
2022Nov 14, 2022
2021Nov 15, 2021
2020Nov 20, 2020
2019Nov 22, 2019
2018Dec 3, 2018
2017Dec 12, 2017
2016Dec 15, 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.

Other Available Disclosures

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