Income Taxes (Tables)

12 Months Ended

Sep. 30, 2023

Income Tax Disclosure [Abstract]

Components of income tax expense (benefit)

The components of the Company’s income tax expense are as follows:

	Year Ended September 30,
	2023		2022		2021
	(In millions)
Current tax expense:
Federal	$	1,293.0	$	1,448.9	$	978.1
State	272.4		256.1		197.0
	1,565.4		1,705.0		1,175.1
Deferred tax expense (benefit):
Federal	(39.0)		21.2		(12.7)
State	(6.9)		7.9		2.7
	(45.9)		29.1		(10.0)
Total income tax expense	$	1,519.5	$	1,734.1	$	1,165.1

Comparison of income tax expense (benefit) and tax computed at the statutory rate

Differences between income tax expense and tax computed by applying the federal statutory rate of 21% to income before income taxes during each year is due to the following:

	Year Ended September 30,
	2023		2022		2021
	(In millions)
Income taxes at federal statutory rate	$	1,326.1	$	1,602.2	$	1,124.8
Increase (decrease) in tax resulting from:
State income taxes, net of federal benefit	208.1		210.0		166.9
Valuation allowance	(3.1)		(2.1)		(3.3)
Tax credits	(44.4)		(100.8)		(116.3)
Excess tax benefit from stock-based compensation	(25.6)		(20.1)		(38.4)
Tax contingencies	(1.5)		—		(6.0)
Other	59.9		44.9		37.4
Total income tax expense	$	1,519.5	$	1,734.1	$	1,165.1

Components of deferred tax assets and liabilities

Components of deferred income taxes are summarized as follows:

	September 30,
	2023		2022
	(In millions)
Deferred tax assets:
Inventory costs	$	67.8	$	74.0
Inventory impairments	5.8		9.5
Warranty and construction defect costs	281.2		239.5
Net operating loss carryforwards	42.2		44.1
Tax credit carryforwards	6.8		6.4
Incentive compensation plans	88.0		84.7
Other	7.0		12.7
Total deferred tax assets	498.8		470.9
Valuation allowance	(14.8)		(17.9)
Total deferred tax assets, net of valuation allowance	484.0		453.0
Deferred tax liabilities:
Deferral of profit on home closings	163.6		209.4
Depreciation of fixed assets	46.3		30.5
Deferral of income	23.4		18.5
Undistributed earnings of subsidiary	51.7		27.3
Other	11.8		26.2
Total deferred tax liabilities	296.8		311.9
Deferred income taxes, net	$	187.2	$	141.1

Schedule of Unrecognized Tax Benefits Roll Forward

A reconciliation of the beginning and ending amounts of unrecognized tax benefits for fiscal 2023 and 2022 is as follows:

	Year Ended September 30,
	2023		2022
	(In millions)
Unrecognized tax benefits, beginning of year	$	2.9	$	2.9
Additions for tax positions taken in the current or prior years	—		—
Settlements	(1.5)		—
Unrecognized tax benefits, end of year	$	1.4	$	2.9