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INCOME TAXES
 6 Months Ended
Jun. 30, 2026
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
A reconciliation between the amount of reported income tax expense and the amount computed by multiplying income before income taxes by the statutory federal tax rate is presented below:
 Six Months Ended June 30,
 20262025
AmountPercentAmountPercent
Tax expense at statutory federal rate$519 21.0 %$296 21.0 %
Domestic federal tax:
Nontaxable or nondeductible items:
Tax benefit attributable to noncontrolling interests(89)(3.6)%(94)(6.7)%
Other20 0.8 %17 1.2 %
Stock-based compensation tax benefit(15)(0.6)%(5)(0.3)%
State and local income taxes, net of federal income tax effect91 3.7 %56 4.0 %
Changes in valuation allowances(7)(0.3)%(7)(0.5)%
Changes in prior year unrecognized tax benefits2 0.1 %— — %
Income tax expense$521 21.1 %$263 18.7 %
Income before income taxes for the six months ended June 30, 2026 and 2025 was $2.472 billion and $1.407 billion, respectively. Our provision for income taxes during interim reporting periods is calculated by applying an estimate of the annual effective tax rate to “ordinary” income or loss (pre-tax income or loss excluding unusual or infrequently occurring discrete items) for the reporting period. In calculating “ordinary” income, non‑taxable income available to noncontrolling interests was deducted from pre-tax income. During the six months ended June 30, 2026, we recorded an income tax benefit of $6 million to decrease the valuation allowance, including an increase of $2 million related to interest expense carryforwards and a decrease of $8 million related to a change in the realizability of deferred tax assets. During the six months ended June 30, 2025, we recorded an income tax benefit of $6 million to decrease the valuation allowance, including an increase of $1 million related to interest expense carryforwards and a decrease of $7 million related to a change in the realizability of deferred tax assets.
There were no adjustments to our estimated liabilities for uncertain tax positions during the six months ended June 30, 2026. The total amount of unrecognized tax benefits as of June 30, 2026 was $69 million, all of which, if recognized, would affect our effective tax rate and income tax benefit.
Our practice is to recognize interest and penalties related to income tax matters in income tax expense in our condensed consolidated statements of operations. Approximately $2 million of interest and penalties related to accrued liabilities for uncertain tax positions are included in the accompanying Condensed Consolidated Statement of Operations for the six months ended June 30, 2026. Total accrued interest and penalties on unrecognized tax benefits at June 30, 2026 were $13 million.