v3.25.4
INCOME TAXES
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Income tax expense was $142 million, $10 million, and $77 million in 2025, 2024 and 2023, respectively. The increase in tax expense in 2025 compared to 2024 is the result of higher earnings in 2025 and increase in valuation allowances that resulted from the India deconsolidation and restructuring transactions in 2025. These negative impacts were partially offset by tax benefits that were the result of continued legal entity simplification and the release of unrecognized tax benefits related to audit settlements in 2025.
The change in tax expense in 2024 compared to 2023 includes lower earnings and legal entity restructuring tax benefits related to simplifying our legal entity structure in 2024 to reduce administrative costs associated with the prior structure. The completion of the restructuring in 2024 created a tax deductible loss which was recognized in 2024 and resulted in a $721 million net tax benefit, partially offset by increases in valuation allowances and the divestiture tax impact.
The following table(s) summarizes the difference between an income tax expense/(benefit) at the United States statutory rate of 21% and the income tax expense/(benefit) at effective worldwide tax rates for the respective periods:
Millions of dollars202520242023
Earnings (loss) before income taxes
United States$(53)$(294)$9 
Foreign569 107 584 
Earnings (loss) before income taxes$516 $(188)$593 
We adopted ASU 2023-09, Improvements To Income Tax Disclosures, on a prospective basis beginning with the year ended December 31, 2025. The following table reconciles the United States statutory tax amount and rate of 21% to our worldwide tax expense (benefit) and rate for the year ended December 31, 2025.

2025
Millions of dollarsAmountPercent
U.S. federal statutory tax rate$108 21.00 %
State and local income taxes, net of federal income tax effect(1)
59 11.43 %
Foreign tax effects
Argentina
Foreign tax rate differential(8)(1.55)%
Valuation allowance21 4.07 %
Brazil
Foreign tax rate differential26 5.04 %
Non-Taxable VAT Reimbursement(27)(5.23)%
Canada
Foreign accrual property income (FAPI)7 1.36 %
Withholding Tax16 3.10 %
Other(1)(0.19)%
Luxembourg
Nondeductible Interest5 0.97 %
Other5 0.97 %
Mauritius
Divestiture tax impact(39)(7.56)%
Foreign tax rate differential(16)(3.10)%
Mexico
Annual corporate inflation adjustment(8)(1.55)%
Foreign currency impacts(20)(3.88)%
Foreign tax rate differential12 2.33 %
Other1 0.19 %
Netherlands
Nondeductible Interest8 1.55 %
Other(2)(0.39)%
Other foreign jurisdictions21 4.07 %
    
2025
Millions of dollarsAmountPercent
Effect of cross-border tax laws
Foreign branch income53 10.27 %
Other(4)(0.78)%
Changes in valuation allowances19 3.68 %
Tax credits
R&D tax credits(21)(4.07)%
Nontaxable or nondeductible items8 1.55 %
Changes in unrecognizable tax benefits(131)(25.39)%
Other adjustments
Legal Entity restructuring tax impact48 9.30 %
Other2 0.32 %
Effective income tax rate$142 27.52 %
(1) The states that contribute to the majority (greater than 50%) of the tax effect in this category includes Pennsylvania, California, & New Jersey for 2025.
The reconciliation of taxes at the United States statutory tax rate of 21% to our worldwide tax expense (benefit) for the years ended December 31, 2024 and 2023 in accordance with the guidance prior to the adoption of ASU 2023-09 was as follows:
Millions of dollars20242023
Income tax (benefit) expense computed at United States statutory rate$(39)$125 
U.S. government tax incentives(19)(20)
Foreign government tax incentives, including BEFIEX(31)(30)
Foreign tax rate differential26 41 
U.S. foreign tax credits(65)(43)
Valuation allowances395 78 
State and local taxes, net of federal tax benefit(56)(43)
Foreign withholding taxes16 13 
U.S. tax on foreign dividends and subpart F income(57)36 
Settlement of global tax audits32 43 
Changes in enacted tax rates10 1 
Nondeductible loss on sale56 5 
Nondeductible fines and penalties— 18 
Legal entity debt restructuring(3)— 
Divestiture tax impact239 — 
Legal entity restructuring tax impact(721)(170)
Expiration/Forfeiture of net operating losses143 5 
Foreign currency impacts33 (23)
Non-deductible expenses46 31 
Other items, net5 10 
Income tax computed at effective worldwide tax rates$10 $77 
            
Current and Deferred Tax Provision
The following table summarizes our income tax (benefit) provision for 2025, 2024 and 2023:
 202520242023
Millions of dollarsCurrentDeferredCurrentDeferredCurrentDeferred
United States$(91)$43 $(6)$(437)$(27)$(212)
Foreign103 12 184 393 197 155 
State and local(1)76 9 (133)(3)(33)
$11 $131 $187 $(177)$167 $(90)
Total income tax expense$142 $10 $77 
United States Tax on Foreign Dividends
Prior to 2024, we reinvested all unremitted earnings of the majority of our foreign subsidiaries and affiliates, and therefore had not recognized any U.S. deferred tax liability on those earnings. The Company had cash and cash equivalents of approximately $669 million at December 31, 2025, of which approximately $644 million was held by subsidiaries in foreign countries. Certain funds outside of the United States could be repatriated to fund our U.S. operations. If these funds were repatriated, they would likely not be subject to United States federal income tax under the previously taxed income or the dividend exemption rules. However, we would likely be required to accrue and pay United States state and local taxes and withholding taxes payable to various countries. The Company has accrued an $11 million income tax liability on the balance sheet as of December 31, 2025, as an estimate of this hypothetical tax obligation (as compared to $15 million at December 31, 2024).
Valuation Allowances
At December 31, 2025, we had net operating loss carryforwards of $4.1 billion, $1.5 billion of which were U.S. state net operating loss carryforwards, compared to $3.8 billion and $1.2 billion at December 31, 2024, respectively. The increase in net operating loss carryforwards was primarily driven by operating losses in certain jurisdictions in 2025. Of the total net operating loss carryforwards at December 31, 2025, $0.9 billion do not expire, with substantially all of the remaining carryforwards expiring in various years through 2045. At December 31, 2025, we had $424 million of United States general business credit carryforwards available to offset future payments of federal income taxes, expiring between 2032 and 2045.
We routinely review the future realization of deferred tax assets based on projected future reversal of taxable temporary differences, available tax planning strategies and projected future taxable income. We have recorded a valuation allowance to reflect the net estimated amount of certain deferred tax assets associated with net operating loss and other deferred tax assets we believe will be realized. Our recorded valuation allowance of $960 million at December 31, 2025 consists of $628 million of net operating loss carryforward deferred tax assets and $332 million of other deferred tax assets. Our recorded valuation allowance was $885 million at December 31, 2024 and consisted of $601 million of net operating loss carryforward deferred tax assets and $284 million of other deferred tax assets. The increase in our valuation allowance was primarily driven by the creation of additional net operating losses that are not expected to be realized.
The amounts of cash taxes paid by (refunded to) Whirlpool are as follows:
Millions of dollars2025
Federal$(1)
State(9)
Foreign
Brazil28 
Canada13 
India11 
Mexico77 
All other foreign17 
Total Income taxes, net of amounts refunded$136 
Deferred Tax Liabilities and Assets
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities used for financial reporting purposes and the amounts used for income tax purposes. The following table summarizes the significant components of our deferred tax liabilities and assets at December 31, 2025 and 2024:
Millions of dollars20252024
Deferred tax liabilities
Intangibles$252 $249 
Property, net124 126 
Right of use assets171 171 
Other14 59 
Total deferred tax liabilities$561 $605 
Deferred tax assets
U.S. general business credit carryforwards, including Energy Tax Credits$428 $363 
Lease liabilities181 179 
Pensions25 33 
Loss carryforwards884 911 
Postretirement obligations26 28 
Foreign tax credit carryforwards221 151 
Research and development capitalization361 367 
Employee payroll and benefits31 53 
Accrued expenses96 82 
Product warranty accrual40 41 
Receivable and inventory allowances48 41 
Disallowed business interest carryforwards182 164 
Outside basis differences182 339 
Other128 153 
Total deferred tax assets$2,833 $2,905 
Valuation allowances for deferred tax assets(960)(885)
Deferred tax assets, net of valuation allowances$1,873 $2,020 
Net deferred tax assets$1,312 $1,415 
On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”) was enacted into law. Among other changes to the Internal Revenue Code of 1986, as amended (the “Code”), the IRA imposes a 15% corporate alternative minimum tax on certain corporations (the “CAMT”). To the extent a corporation is subject to the CAMT in a prior taxable year and in a later taxable year is subject to the regular corporate tax, such corporation may apply the prior amounts paid under the CAMT against its regular tax liability to the extent such credits do not reduce the regular tax liability below the CAMT applicable in such taxable year. We have no CAMT liability nor related deferred tax asset carryforward as of December 31, 2025.

Unrecognized Tax Benefits
The following table represents a reconciliation of the beginning and ending amount of unrecognized tax benefits that if recognized would impact the effective tax rate, excluding federal benefits of state and local tax positions, and interest and penalties:
Millions of dollars202520242023
Balance, January 1$349 $380 $589 
Additions for tax positions of the current year8 10 13 
Additions for tax positions of prior years8 14 22 
Reductions for tax positions of prior years(2)(52)(56)
Settlements during the period (1)
(251)(3)(188)
Lapses of applicable statute of limitation— — — 
Balance, December 31$112 $349 $380 
(1) During the fourth quarter of both 2023 and 2025, the Company resolved a number of disputed tax positions with the U.S. and other tax authorities. The Company had previously recorded reserves for the risk associated with these tax positions, and the settlement of these matters resulted in a reduction in the Company's unrecognized tax benefits, which is shown in the table above.
Interest and penalties associated with unrecognized tax benefits resulted in a net benefit of $7 million, net expense of $14 million and net benefit of $12 million in December 31, 2025, 2024 and 2023, respectively. We have accrued a total of $49 million, $53 million and $78 million at December 31, 2025, 2024 and 2023, respectively.
We are in various stages of tax disputes (including audits, appeals and litigation) with certain governmental tax authorities. We establish liabilities for the difference between tax return provisions and the benefits recognized in our financial statements. Such amounts represent a reasonable provision for taxes ultimately expected to be paid, and may need to be adjusted over time as more information becomes known. We are no longer subject to any significant tax disputes (including audits, appeals and litigation) for the years before 2012 relating to US Federal income taxes and for the years before 2004 relating to any state, local or foreign income taxes.