Tecnoglass Inc. Income Taxes Disclosure

Note 15. Income Taxes

 

The components of income before taxes are as follows:

Schedule of Components of Income Before Taxes 

		2025				2024				2023
		Twelve months ended December 31,
		2025				2024				2023
United States			109,898				48,399				47,623
Foreign			125,394				176,759				213,792
Income before taxes			235,292				225,158				261,414

 

The components of income tax expense are as follows:

Schedule of Components of Income Tax Expense

		2025				2024				2023
		Twelve months ended December 31,
		2025				2024				2023
Current income tax
Federal		$	(22,817	)		$	(9,535	)		$	(9,895	)
State and local			(7,186	)			(2,594	)			(2,667	)
Foreign			(38,100	)			(53,590	)			(56,996	)
Total current income tax			(68,103	)			(65,719	)			(69,558	)
Deferred income tax
Federal			1,911				124				260
State and local			235				88				72
Foreign			5,477				1,658				(8,679	)
Total deferred income tax			7,623				1,870				(8,346	)
Total income tax provision		$	(75,726	)		$	(63,849	)		$	(77,904	)

 

The Company has the following deferred tax assets and liabilities:

Schedule of Deferred Tax Assets and Liabilities

		2025				2024
		Year ended December 31,
		2025				2024
Deferred tax assets:
Property, plant and equipment adjustments			207				52
Tax benefit on installation of renewable energy project			-				83
Depreciation			821				635
Accounts payable and debt			647				223
Foreign currency transactions			1,919				2,440
Other			1,015				58
Total deferred tax assets		$	4,609			$	3,491
Deferred tax liabilities:
Depreciation and Amortization			(6,396	)			(7,902	)
Property, plant and equipment adjustments			(4,753	)			-
Other			(2,403	)			(1,966	)
Foreign currency transactions			(12,204	)			(4,757	)
Total deferred tax liabilities		$	(25,756	)		$	(14,625	)
Net deferred tax		$	(21,147	)		$	(11,134	)

 

 

A reconciliation of the statutory tax rate to the Company’s effective tax rate is as follows:

Schedule of Effective Income Tax Rate Reconciliation 

		$ Amount				%
		Year ended December 31, 2025
		$ Amount				%
Tax provision at the U.S. federal statutory rate			49,411				21.0	%
State and local income tax, net of federal income tax effect (1)			6,023				2.6	%
Foreign tax effects:
Statutory tax rate difference between Colombia and United States			17,180				7.3	%
Non-deductible expenses
Non-taxable income
Other			1,795				0.8	%
Other			1,317				0.5	%
Income tax expense and effective income tax rate			75,726				32.2	%

 

(1)

The state that contributed the majority of the effect in this category was Florida.

 

The Company is incorporated in the Cayman Islands, which does not impose corporate income taxes. For purposes of the rate reconciliation, the Company uses the U.S. federal statutory rate of 21%, as the majority of its operating revenue is generated in the United States.

 

As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the following is a reconciliation of the difference between the effective income tax rate and the statutory tax rate:

 

		2024				2023
		Year ended December 31,
		2024				2023
Income tax expense at statutory rates			31.2	%			33.0	%
Non-deductible expenses			1.5	%			0.9	%
Non-taxable income			-4.3	%			-1.2	%
Effective tax rate			28.4	%			29.8	%

 

No single individual item contributed significantly to the reconciliation of the Company’s effective tax rate to the statutory rate during the year ended December 31, 2024 and 2023.

 

Income taxes paid, net of refunds, during the periods presented were as follows:

Schedule of Income Taxes Paid Net of Refunds 

		2025
Income taxes paid:
Domestic:
Federal			19,911
State			3,246
Foreign:
Colombia			52,901
Other			52
Total cash taxes paid		$	76,110

 

 

We are subject to taxation in the U.S. and various state and foreign jurisdictions. Primarily the state of Florida, the Republic of Colombia and the Republic of Panama. As of December 31, 2025, our tax years 2020 to 2024 remain subject to examination by tax authorities.

 

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted, reinstating 100% bonus depreciation, increasing Section 179 expensing limits, modifying the Section 163(j) interest limitation, full expensing of domestic R&D and deductibility of qualified production structures. As these provisions are temporary in nature, their current and deferred tax effects offset, resulting in no material impact on the Company’s effective tax rate.