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INCOME TAXES
 3 Months Ended 9 Months Ended
Mar. 31, 2026
Mar. 31, 2026
Income Tax Disclosure [Abstract]    
INCOME TAXES
NOTE 7: INCOME TAXES
We file a consolidated U.S. federal income tax return with the Internal Revenue Service (IRS) and also file income tax returns in various state, local, and foreign jurisdictions.
On July 4, 2025, H.R. 1 was signed into law. The legislation did not have a material impact on our income tax expense for the nine months ended March 31, 2026, and we do not expect it to materially impact our effective income tax rate for the fiscal year ending June 30, 2026.
Our effective income tax rate on continuing operations, including the impact of discrete tax items, was 8.1% for the nine months ended March 31, 2026, compared to 25.3% for the nine months ended March 31, 2025. Discrete tax items decreased the effective tax rate by 16.1% for the nine months ended March 31, 2026, and increased the effective tax rate by 0.9% for the nine months ended March 31, 2025. We recorded a discrete income tax benefit of $77.6 million for the nine months ended March 31, 2026, compared to a discrete income tax expense of $3.8 million for the nine months ended March 31, 2025.
The discrete income tax benefit recognized during the current year period was primarily attributable to the settlement of an IRS examination of our 2020 U.S. federal income tax return and related carryback claims to the 2015 through 2018 tax years. The closure of the IRS examination resulted in a discrete income tax benefit of $84.1 million, which was recorded in income tax expense. The benefit primarily reflects the release of the related unrecognized tax benefits, including reversal of accrued interest through the date of settlement. Due to the seasonality of our business, the impact of discrete tax items on our effective income tax rate for the nine months ended March 31, 2026 is greater than the expected impact on our projected full-year effective income tax rate.
Changes in gross unrecognized tax benefits for the nine months ended March 31, 2026 are as follows:
(in 000s)
Balances as of July 1, 2025$266,548 
Additions based on tax positions related to prior years528 
Reductions based on tax positions related to prior years(2,998)
Additions based on tax positions related to the current year16,998 
Reductions related to settlements with tax authorities(122,159)
Expiration of statute of limitations(1,182)
Balance as of March 31, 2026$157,735 
NOTE 7: INCOME TAXES
We file a consolidated U.S. federal income tax return with the Internal Revenue Service (IRS) and also file income tax returns in various state, local, and foreign jurisdictions.
On July 4, 2025, H.R. 1 was signed into law. The legislation did not have a material impact on our income tax expense for the nine months ended March 31, 2026, and we do not expect it to materially impact our effective income tax rate for the fiscal year ending June 30, 2026.