Income Taxes

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company files U.S. federal and state, and foreign income tax returns in jurisdictions with varying statutes of limitations. With few exceptions, the Company is no longer subject to U.S. federal income tax examinations for years prior to 2020 and state and local income tax examinations prior to 2016. In significant foreign jurisdictions, years prior to 2015 are generally no longer subject to income tax examinations by their respective tax authorities.

The Company’s effective tax rate was 25.3% and 25.9% for the three months ended September 30, 2024 and 2023; and 26.9% for both the nine months ended September 30, 2024 and 2023. The effective tax rate for the three months ended September 30, 2024 was primarily impacted by a decrease in the valuation allowance on foreign tax credits. The effective tax rate for the nine months ended September 30, 2024 was primarily impacted by the portion of stock-based compensation expense that is not deductible for tax purposes, an increase in taxes on foreign income, and an increase in unrecognized tax benefits, partially offset by a decrease in the valuation allowance on foreign tax credits. The effective tax rate for the three months ended September 30, 2023 was primarily impacted by a decrease in the valuation allowance on foreign tax credits partially offset by an increase in unrecognized tax benefits. The effective tax rate for the nine months ended September 30, 2023 was primarily impacted by the portion of stock-based compensation expense that is not deductible for tax purposes.

The Company made income tax payments, net of tax refunds, of $74 million and $114 million during the nine months ended September 30, 2024 and 2023.