GIBRALTAR INDUSTRIES, INC.ROCK
GIBRALTAR INDUSTRIES, INC. Income Taxes Disclosure
INCOME TAXES
The components of income before taxes from continuing operations consisted of the following for the years ended December 31 (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Domestic | $ | 126,226 | $ | 165,982 | $ | 124,484 | |||||||||||
| Foreign | 350 | 5,005 | (844) | ||||||||||||||
| Income before taxes from continuing operations | $ | 126,576 | $ | 170,987 | $ | 123,640 | |||||||||||
The provision for income taxes from continuing operations consisted of the following for the years ended December 31 (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Current: | |||||||||||||||||
| U.S. federal | $ | 24,930 | $ | 27,901 | $ | 16,300 | |||||||||||
| State | 6,055 | 7,155 | 4,739 | ||||||||||||||
| Foreign | 6 | 1,163 | (416) | ||||||||||||||
| Total current | 30,991 | 36,219 | 20,623 | ||||||||||||||
| Deferred: | |||||||||||||||||
| U.S. federal | (1,499) | (180) | 9,007 | ||||||||||||||
| State | (457) | (298) | 2,417 | ||||||||||||||
| Foreign | (15) | 202 | 200 | ||||||||||||||
| Total deferred | (1,971) | (276) | 11,624 | ||||||||||||||
| Provision for income taxes | $ | 29,020 | $ | 35,943 | $ | 32,247 | |||||||||||
The provision for income taxes from continuing operations differs from the federal statutory rate of 21% due to the following for the years ended December 31 (in thousands, except for percentages):
| 2025 | 2024 | 2023 | |||||||||||||||||||||||||||||||||
| U.S. federal statutory tax rate | $ | 26,581 | 21.0 | % | $ | 35,907 | 21.0 | % | $ | 25,964 | 21.0 | % | |||||||||||||||||||||||
| State and local income taxes, net of federal income tax effect (1) | 4,335 | 3.4 | % | 5,298 | 3.1 | % | 5,607 | 4.5 | % | ||||||||||||||||||||||||||
| Foreign tax effects | (70) | (0.1) | % | 319 | 0.2 | % | (40) | — | % | ||||||||||||||||||||||||||
| Effect of changes in tax laws or rates enacted in the current period | — | — | % | — | — | % | — | — | % | ||||||||||||||||||||||||||
| Effect of cross-border tax laws | (52) | — | % | (91) | (0.1) | % | (46) | — | % | ||||||||||||||||||||||||||
| Tax credits: | |||||||||||||||||||||||||||||||||||
| Energy-related tax credits | (2,356) | (1.8) | % | (1,013) | (0.6) | % | — | — | % | ||||||||||||||||||||||||||
| Other tax credits | (346) | (0.3) | % | (683) | (0.4) | % | (444) | (0.4) | % | ||||||||||||||||||||||||||
| Change in valuation allowances | (108) | (0.1) | % | (6,027) | (3.5) | % | — | — | % | ||||||||||||||||||||||||||
| Nontaxable or nondeductible items: | |||||||||||||||||||||||||||||||||||
| Executive compensation | 434 | 0.3 | % | 1,556 | 0.9 | % | 1,181 | 1.0 | % | ||||||||||||||||||||||||||
| Share-based payment awards | (448) | (0.3) | % | (263) | (0.2) | % | (192) | (0.2) | % | ||||||||||||||||||||||||||
| Other nontaxable or nondeductible items | 629 | 0.5 | % | 842 | 0.5 | % | 122 | 0.1 | % | ||||||||||||||||||||||||||
| Changes in unrecognized tax benefits | — | — | % | — | — | % | — | — | % | ||||||||||||||||||||||||||
| Other adjustments | 421 | 0.3 | % | 98 | 0.1 | % | 95 | 0.1 | % | ||||||||||||||||||||||||||
| Effective tax rate | $ | 29,020 | 22.9 | % | $ | 35,943 | 21.0 | % | $ | 32,247 | 26.1 | % | |||||||||||||||||||||||
(1) For the year ended December 31, 2025, state taxes in California, New York and Michigan make up the majority (greater than 50 percent) of the tax effect in this category. For the year ended December 31, 2024, state taxes in California, Illinois, Florida, Kansas, Minnesota and Michigan make up the majority (greater than 50 percent) of the tax effect in this category. For the year ended December 31, 2023, state taxes in California, Maine, New Jersey and New York make up the majority (greater than 50 percent) of the tax effect in this category.
Consolidated income taxes paid (net of refunds) consisted of the following for the years ended December 31 (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Federal | $ | (7,737) | $ | 22,694 | $ | 18,557 | |||||||||||
| State | 6,018 | 8,445 | 5,611 | ||||||||||||||
| Foreign | 1,952 | (95) | (721) | ||||||||||||||
| Total | $ | 233 | $ | 31,044 | $ | 23,447 | |||||||||||
For the year ended December 31, 2025, New York and Canada exceeded five percent of consolidated income taxes paid (net of refunds), with income taxes paid (net of refunds) of $1.0 million and $1.9 million, respectively. For the years ended December 31, 2024 and 2023, no jurisdictions exceeded five percent of consolidated income taxes paid (net of refunds), respectively.
The Company has recorded U.S. federal, state, and foreign current tax receivables of $41.7 million and $10.4 million at December 31, 2025 and 2024, respectively, which are presented within prepaid expenses and other current assets in the Company's consolidated balance sheets.
Consolidated deferred tax (assets) liabilities consisted of the following at December 31 (in thousands):
| 2025 | 2024 | ||||||||||
| Depreciation | $ | 13,917 | $ | 13,523 | |||||||
| Goodwill | 40,345 | 69,155 | |||||||||
| Operating leases | 15,015 | 11,265 | |||||||||
| Intangible assets | 6,706 | — | |||||||||
| Prepaid expenses | 1,428 | 1,115 | |||||||||
| Other | 157 | 233 | |||||||||
| Gross deferred tax liabilities | 77,568 | 95,291 | |||||||||
| Research and development expenditures | (5,840) | (8,184) | |||||||||
| Equity compensation | (7,108) | (7,148) | |||||||||
| Intangible assets | — | (854) | |||||||||
| Operating leases | (15,619) | (11,670) | |||||||||
| Capital loss carryforward | (19,132) | (19,392) | |||||||||
| Investment tax credit carryforward | (45,984) | — | |||||||||
| Other post-employment benefit plans | (1,086) | (903) | |||||||||
| Assets held for sale | (3,310) | — | |||||||||
| Accrued warranties | (3,114) | (3,901) | |||||||||
| Inventory reserves | (1,990) | (505) | |||||||||
| Restructuring reserves | (968) | (972) | |||||||||
| Vacation reserves | (851) | (653) | |||||||||
| Self-insurance reserves | (1,013) | (1,000) | |||||||||
| Other | (3,985) | (2,901) | |||||||||
| Gross deferred tax assets | (110,000) | (58,083) | |||||||||
| Valuation allowances | 19,696 | 19,434 | |||||||||
| Deferred tax assets, net of valuation allowances | (90,304) | (38,649) | |||||||||
| Net deferred tax (assets) liabilities | $ | (12,736) | $ | 56,642 | |||||||
The Company has recorded deferred tax assets of $17.8 million at December 31, 2025, which are presented within other assets on the Company's consolidated balance sheets.
The Company had total net operating loss carryforwards of $30.4 million, which included $0.2 million for federal and $30.2 million for state at December 31, 2025. There was no foreign net operating loss carryforward. The federal and state net operating loss carryforwards expire between 2032 and 2045. The Company recognized a total of $1.3 million of deferred tax assets, net of the federal tax benefit, related to these net operating losses prior to any valuation allowances, which included $0.1 million of federal and $1.2 million of state deferred tax assets.
In connection with the sale of a business during 2021, the Company generated a capital loss of $113.7 million for federal and state purposes to the extent allowable under state tax regulations. Amended federal returns were filed to carryback $3.7 million of capital loss. As a result of the sale of the Company's electronic locker business within its Residential segment in 2024, $29.2 million of the capital loss was utilized to offset the capital gain from the sale, and the valuation allowance was subsequently adjusted. As of December 31, 2025, the remaining capital loss carryforward is $80.8 million. The capital loss carryforward will expire in 2026. The Company recognized a total of $19.1 million of deferred tax assets, net of the federal benefit, related to this carryforward prior to any valuation allowances, which included $16.4 million of federal and $2.7 million of state deferred tax assets. The Company has a full valuation allowance on the capital loss carryforward and as a result there is no deferred tax asset related to the capital loss.
During the year ended December 31, 2025, the Company entered into an agreement to purchase approximately $82.8 million of transferrable energy-related investment tax credits. At December 31, 2025, $79.5 million of the related purchase commitment was included in accrued expenses on the Company's consolidated balance sheets. The Company expects to utilize $8.3 million of these credits on its 2025 federal return and to carryback approximately $28.5 million to its federal returns for the years ended December 31, 2022 through 2024. In connection with this transaction and other similar transactions during the year ended December 31, 2025, the Company recognized a discount of $2.3 million within provision for income taxes from continuing operations in the Company's consolidated statements of operations. During the year ended December 31, 2024, the Company purchased and utilized approximately $12.7 million of transferrable energy-related investment tax credits and recognized a discount of $1.0 million within provision for income taxes from continuing operations in the Company's consolidated statements of operations.
At December 31, 2025, the Company had an energy-related investment tax credit carryforward of $46.0 million arising from the 2025 transaction described above, and a corresponding deferred tax asset has been recorded. The Company expects to recognize an additional $1.8 million tax benefit related to the discount on the remaining credit upon its future utilization. These credits will expire in 2047.
Valuation allowances have been recorded relating to certain federal, state, and foreign deferred tax assets if it is more likely than not that such assets will not be realized. The following sets forth a reconciliation of the beginning and ending amount of the Company’s consolidated valuation allowance (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Balance as of January 1 | $ | 19,434 | $ | 26,593 | $ | 26,488 | |||||||||||
| Cost charged to the tax provision | 522 | 11 | 105 | ||||||||||||||
| Reductions | (260) | (7,170) | — | ||||||||||||||
| Balance as of December 31 | $ | 19,696 | $ | 19,434 | $ | 26,593 | |||||||||||
At December 31, 2025, the Company had approximately $3.3 million of undistributed earnings of international subsidiaries. The Company continues to maintain its assertion that all remaining foreign earnings will be indefinitely reinvested. Any excess earnings could be used to grow the Company's international operations through launches of new capital projects or additional acquisitions. Determination of the amount of unrecognized deferred U.S. income tax liability related to the Company's remaining unremitted foreign earnings is not practicable due to the complexities associated with its hypothetical calculation. With respect to outside basis differences other than unremitted earnings, the Company continues to be permanently reinvested and have no plans to liquidate or sell any international subsidiaries. In addition, the Company has not provided for deferred taxes on any outside basis differences of its domestic subsidiaries as it has the ability and intent to recover these basis differences in a tax-free manner. It is not practicable to determine the amount of unrecognized deferred tax related to these basis differences.
The Company did not have any unrecognized tax benefits or activity related to such benefits in any of the years presented in the consolidated financial statements. The Company classifies accrued interest and penalties related to unrecognized tax benefits in income tax expense. No interest or penalties have been recognized during the years presented.
The Company and its U.S. subsidiaries file a U.S. federal consolidated income tax return. Foreign and U.S. state jurisdictions have statute of limitations generally ranging from to ten years.
In December 2021, the Organization for Economic Cooperation and Development introduced Base Erosion and Profit Shifting ("BEPS") Pillar 2 rules that impose a global minimum tax rate of 15%. Numerous countries, including European Union member states, have enacted or are expected to enact legislation to be effective for tax years beginning as early as January 1, 2024, with general implementation of global minimum tax by January 1, 2025. The Company considered the impacts of BEPS Pillar 2 on its consolidated financial statements and determined that it meets the revenue threshold to be a BEPS taxpayer, however, the Company has met the safe harbor tests such that no additional tax liability applies.
The (benefit of) provision for income taxes from discontinued operations consisted of the following for the years ended December 31 (in thousands):
| 2025 | 2024 | 2023 | |||||||||||||||
| Current: | |||||||||||||||||
| U.S. federal | $ | (11,500) | $ | 171 | $ | 5,215 | |||||||||||
| State | (1,508) | 738 | 1,373 | ||||||||||||||
| Foreign | — | (62) | 448 | ||||||||||||||
| Total current | (13,008) | 847 | 7,036 | ||||||||||||||
| Deferred: | |||||||||||||||||
| U.S. federal | (30,058) | (259) | (391) | ||||||||||||||
| State | (7,342) | 54 | (305) | ||||||||||||||
| Foreign | — | — | (128) | ||||||||||||||
| Total deferred | (37,400) | (205) | (824) | ||||||||||||||
| (Benefit of) provision for income taxes from discontinued operations | $ | (50,408) | $ | 642 | $ | 6,212 | |||||||||||
For the year ended December 31, 2025, benefit of income taxes from discontinued operations includes a $3.1 million tax benefit related to Internal Revenue Code ("IRC") Section 45X credits generated by the Company's manufacturing activities. An additional $8.1 million benefit related to IRC Section 45X is included within operating expenses of discontinued operations as these credits are refundable under a direct pay election, and as a result are not included within the benefit of income taxes from discontinued operations in the Company's consolidated statements of operations.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 19, 2025 | |
| 2023 | Feb 21, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 23, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 28, 2020 | |
| 2018 | Feb 27, 2019 | |
| 2017 | Feb 27, 2018 | |
| 2016 | Feb 21, 2017 | |
| 2015 | Feb 18, 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.