Income Taxes |
6 Months Ended |
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Jun. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | Income Taxes For interim periods, we recognize an income tax provision or benefit based on our estimated annual effective tax rate expected for the full year, adjusted for discrete items recognized during the interim period. Discrete items (e.g., significant or unusual items) are separately recognized in the quarter during which they occur and can cause the effective tax rate to vary from quarter to quarter. An income tax provision (benefit) of $(0.8) million and $0.6 million for the three and six months ended June 30, 2025, respectively, and $(0.2) million and $0.3 million for the three and six months ended June 30, 2024, respectively, which resulted in effective tax rates of 4.0% and (0.8)% for the three and six months ended June 30, 2025, respectively, and (17.5)% and (2.1)% for the three and six months ended June 30, 2024, respectively. The income tax expense (benefit) recorded during the three and six months ended June 30, 2025, primarily relates to non-deductible expenses and state and foreign taxes. The income tax expense recorded during the three and six months ended June 30, 2024, primarily relates to state and foreign taxes. As of June 30, 2025, the Company had unrecognized tax benefits of $2.5 million that, if recognized, would affect the overall effective tax rate. The Company and its subsidiaries are not currently subject to any material income tax audits in any federal, state or local jurisdiction for any tax year. The Company’s foreign subsidiary is currently under an income tax examination of the financial year ended 2022 India income tax return. Tax Receivables Agreement In connection with the reorganization undertaken in 2015 prior to our IPO where our predecessor, Evolent Health Holdings, Inc merged with and into Evolent Health, Inc. (the “Offering Reorganization”), the Company entered into the TRA with certain of its investors, which provides for the payment by the Company to these investors of 85% of the amount of the tax benefits that the Company is deemed to realize as a result of increases in our tax basis related to exchanges of Class B common units as well as tax benefits attributable to the future utilization of pre-IPO NOLs. See Note 10 above for discussion of our TRA.
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