WEYERHAEUSER CO Income Taxes Disclosure

NOTE 18: INCOME TAXES

This note provides details about income taxes applicable to our operations, including the following:

 

	earnings before income taxes,
	provision for income taxes,
	effective income tax rate,
	deferred tax assets and liabilities and
	unrecognized tax benefits.

 

The Income Taxes section of Note 1: Summary of Significant Accounting Policies provides details about how we account for our income taxes.

EARNINGS BEFORE INCOME TAXES

DEFERRED TAX ASSETS AND LIABILITIES

Deferred tax assets and liabilities reflect the future tax effect created by differences between the timing of when income or deductions are recognized for pretax financial book reporting purposes versus income tax purposes. Deferred tax assets represent a future tax benefit (or reduction to income taxes in a future period), while deferred tax liabilities represent a future tax obligation (or increase to income taxes in a future period).

Net Operating Loss and Credit Carryforwards

Our gross federal, state and foreign net operating loss carryforwards as of December 31, 2025 totaled $1.5 billion as follows:

 

	Federal — U.S. REITs — $245 million that do not expire; U.S. TRSs — $561 million that do not expire;

	State — $705 million, $552 million of the total will begin to expire in 2028 and
	Foreign — none currently recorded.

 

Our gross state credit carryforwards as of December 31, 2025 totaled $60 million, which includes $10 million that expire from 2026 through 2037. Our U.S. TRSs have $8 million in foreign tax credit carryforwards that expire from 2027 through 2031.

Valuation Allowances

With the exception of the valuation allowance discussed below, we believe it is more likely than not that we will have sufficient future taxable income to realize our deferred tax assets.

Our valuation allowance on our deferred tax assets was $81 million as of December 31, 2025, which related to state credits, state net operating losses and foreign tax credits.

UNRECOGNIZED TAX BENEFITS

Unrecognized tax benefits represent potential future obligations to taxing authorities if uncertain tax positions we have taken on previously filed tax returns are not sustained. In accordance with our accounting policy, we accrue interest and penalties related to unrecognized tax benefits as a component of income tax expense (see Note 1: Summary of Significant Accounting Policies). The total gross amount of unrecognized tax benefits as of December 31, 2025 and 2024, as well as the activity during those years, were immaterial.

As of December 31, 2025, none of our U.S. federal income tax returns are under examination, with tax years 2022 forward open to examination. We are undergoing examination in foreign jurisdictions for the 2022 tax year, with tax years 2018 forward open to examination. We are undergoing examinations in state jurisdictions for tax years 2020 through 2024, with tax years 2009 forward open to examination. We do not expect that the outcome of any examination will have a material effect on our consolidated financial statements; however, audit outcomes and the timing of audit settlements are subject to significant uncertainty.

TAX LEGISLATION

On July 4, 2025, H.R. 1, commonly known as the One Big, Beautiful Bill Act (the OBBBA), was enacted. The OBBBA contains significant changes to corporate taxation, including accelerated deductions for capital spending, expensing of research and development costs and increased deductibility of interest expense. Additionally, effective for taxable years beginning after December 31, 2025, the value of TRS securities that a REIT may hold will increase from 20 percent to 25 percent of the value of the REIT’s total assets. The enactment of the OBBBA did not materially impact our 2025 financial statements.