v3.25.4
Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Taxes  
Income Taxes

(7) Income Taxes

The Company was included in the federal consolidated income tax return of Liberty Broadband and its subsidiaries during the periods presented, until the Separation occurred on July 14, 2025. The income tax provision included in these financial statements has been prepared on a stand-alone basis, as if GCI Liberty was not part of the consolidated Liberty Broadband tax group.

Income tax expense (benefit) consists of:

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Years ended December 31,

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​

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2025

​

2024

​

​

​

amounts in millions

Current:

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​

  ​

​

  ​

​

Federal

​

$

219

​

12

​

State and local

​

 

95

​

5

​

​

​

 

314

​

17

​

Deferred:

​

 

​

​

  ​

​

Federal

​

 

(269)

​

6

​

State and local

​

 

(122)

​

4

​

​

​

​

(391)

​

10

​

Total:

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​

​

​

​

Federal

​

​

(50)

​

18

​

State and local

​

​

(27)

​

9

​

Income tax expense (benefit)

​

$

(77)

​

27

​

​

Income tax (benefit) expense differs from the amounts computed by applying the applicable U.S. federal income tax rate of 21% as a result of the following:

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Years ended December 31,

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  ​ ​ ​

2025

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2024

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​

​

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(millions)

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(percent )

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​

(millions)

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(percent )

​

​

​

​

​

​

​

​

​

​

​

​

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U.S. Federal statutory tax rate

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$

(81)

​

(21)

%

​

20

​

21

%

Domestic federal reconciling items

​

​

​

​

​

​

​

​

​

​

​

Tax credits

​

 

(2)

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(1)

%

​

(2)

​

(2)

%

Non-taxable and nondeductible items, net

​

 

​

​

​

​

​

​

​

​

​

Executive Compensation

​

​

3

​

1

%

​

1

​

1

%

Non-deductible goodwill impairment

​

​

23

​

6

%

​

—

​

—

​

Other

​

​

1

​

—

​

​

1

​

1

%

Domestic state and local income taxes, net of federal effect

​

​

(21)

​

(5)

%

​

7

​

7

%

Total income tax expense (benefit)

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$

(77)

​

(20)

%

​

27

​

28

%

​

For both of the years ended December 31, 2025 and 2024, state and local income taxes in Alaska comprised the majority of the domestic state and local income taxes, net of federal effect category.

For the year ended December 31, 2025, the significant reconciling items, as noted in the table above, are primarily due to state income taxes, offset by an impairment of goodwill that is not deductible for tax purposes.

For the year ended December 31, 2024, the significant reconciling items, as noted in the table above, are primarily due to state income taxes, partially offset by federal tax credits.

The tax effects of temporary differences that give rise to significant portions of the deferred income tax assets and deferred income tax liabilities are presented below:

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December 31, 

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  ​ ​ ​

2025

  ​ ​ ​

2024

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amounts in millions

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Deferred tax assets:

 

​

  ​

 

  ​

​

Tax loss and credit carryforwards

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$

117

 

2

​

Deferred revenue

​

 

23

 

44

​

Operating lease liability

​

 

19

 

30

​

Other accrued liabilities

​

 

6

 

8

​

Asset retirement obligations

​

​

31

​

25

​

Other future deductible amounts

​

 

14

 

23

​

Deferred tax assets

​

 

210

 

132

​

Valuation allowance

​

 

(1)

 

(1)

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Net deferred tax assets

​

 

209

 

131

​

Deferred tax liabilities

​

 

  ​

 

  ​

​

Property and equipment

​

 

(44)

 

(207)

​

Intangible assets

​

 

(114)

 

(252)

​

Operating lease ROU assets

​

 

(20)

 

(31)

​

Deferred tax liabilities

​

 

(178)

 

(490)

​

Net deferred tax assets (liabilities)

​

$

31

 

(359)

​

​

For federal income tax purposes, the Separation was structured as a deemed acquisition of GCI, LLC’s assets by GCI Liberty at their fair market value.  The deemed acquisition reset the tax basis in GCI, LLC’s assets to their fair market

value, which resulted in a decrease to the Company’s deferred tax liability. With the assistance of a third-party specialist, the Company utilized a direct cost approach to determine the fair value of its property and equipment (Level 3).  The Separation along with an impairment led to a net deferred tax asset of $31 million as of December 31, 2025.

During the year ended December 31, 2025, there was no change in the valuation allowance.

At December 31, 2025, the Company had a deferred tax asset of $117 million for federal and state net operating loss (“NOL”) and tax credit carryforwards. The future use of $2 million of these carryforwards expire at certain future dates. Based on current projections, $1 million of these carryforwards may expire unused and accordingly are subject to a valuation allowance. The additional $1 million of carryforwards that are expected to be utilized will begin to expire in 2028.

As of December 31, 2025 and 2024, the Company had not recorded tax reserves related to unrecognized tax benefits for uncertain tax positions.

Certain entities that are subsidiaries of the Company were part of a previous parent’s consolidated federal tax group until the date of the Original Combination and were part of the Liberty Broadband consolidated federal tax group subsequent to the Original Combination and prior to the Separation. As of December 31, 2025, all of Liberty Broadband’s federal tax years prior to 2021 are closed. Liberty Broadband’s 2024 tax year is under IRS examination. Liberty Broadband’s 2025 tax year is being examined currently as part of the IRS’s Compliance Assurance Process program.