Income Taxes |
9 Months Ended |
|---|---|
Sep. 30, 2026 | |
| Income Tax Disclosure [Abstract] | |
| Income Taxes | 6. Income Taxes The effective income tax rate was 36.4% and 31.5% for the three and nine months ended September 30, 2026, respectively, and 29.0% and 28.9% for the three and nine months ended September 30, 2025, respectively. The effective tax rate for the three and nine months ended September 30, 2026 primarily comprised the U.S. federal statutory rate of 21.0%, state and local income taxes, non-deductible compensation, and the impact of valuation allowance against foreign net operating losses. The effective tax rate for the three and nine months ended September 30, 2025 primarily comprised the U.S. federal statutory rate of 21.0%, state and local income taxes, and income in foreign jurisdictions taxed at higher statutory tax rates. At the end of each interim period, the Company estimates the annual effective tax rate and applies that rate to its ordinary quarterly earnings. The tax expense or benefit related to significant unusual or infrequently occurring items that will be separately reported or reported net of their related tax effect, and are individually computed, is recognized in the interim period in which those items occur. In addition, the effect of changes in enacted tax laws or rates or tax status is recognized in the interim period in which the change occurs. For periods prior to the Separation, the Company’s income tax provision was prepared following the separate return method. The separate return method applies ASC Topic 740, Income Taxes, to the stand-alone financial statements of each member of the consolidated group as if the group members were separate taxpayers. The calculation of the Company’s income taxes on a separate return basis requires a considerable amount of judgment and use of both estimates and allocations. As a result, the income taxes of the Company as presented in the accompanying unaudited condensed financial statements may not be indicative of the income taxes that the Company will generate in the future. Furthermore, current obligations for taxes where the Company’s operations were included in tax returns with the activities of S&P Global are deemed settled with S&P Global as a component of Former Parent Investment for purposes of the accompanying unaudited condensed financial statements. Following the Separation, the Company’s income tax provision is prepared on a stand-alone basis including the Company and its wholly-owned subsidiaries based on and reflective of the expected income tax return filing obligations required by U.S. federal, state, and non-U.S. taxing authorities. As of September 30, 2026, accrued income taxes payable was $38 million and was included in Other current liabilities on the unaudited condensed balance sheets. On January 5, 2026, the Organisation for Economic Co-operation and Development (“OECD”) issued administrative guidance outlining a framework under which U.S.-parented groups may be excluded from the application of the OECD’s global minimum tax rules. Each member jurisdiction will need to adopt and enact this guidance into local law, and the timing and manner of adoption may vary. We are continuing to monitor developments related to this guidance and will evaluate the impact on our financial statements as additional information becomes available.
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