INCOME TAXES |
6 Months Ended |
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Jun. 30, 2025 | |
| Income Tax Disclosure [Abstract] | |
| Income Tax Disclosure |
NOTE 5. INCOME TAXES
Our effective tax rates for the three and six months ended June 30, 2025, were 24.2 percent and 24.1 percent , respectively. Our effective tax rates for the three and six months ended June 30, 2024, were 23.0 percent and 13.1 percent, respectively.
The three months ended June 30, 2025, contained net favorable discrete tax items of $3 million primarily due to $4 million of favorable adjustments for uncertain tax positions, partially offset by $1 million of other unfavorable tax items.
The six months ended June 30, 2025, contained net favorable discrete tax items of $10 million, primarily due to $8 million of favorable adjustments for share-based compensation tax benefits and $5 million of favorable adjustments for uncertain tax positions, partially offset by $3 million of other unfavorable tax items.
The three months ended June 30, 2024, contained favorable discrete tax items of $9 million primarily due to share-based compensation tax benefits.
The six months ended June 30, 2024, contained favorable discrete tax items primarily due to the $1.3 billion non-taxable gain on the Atmus split-off. Other discrete tax items were $30 million favorable primarily due to adjustments related to audit settlements and share-based compensation tax benefits. On July 4, 2025, the “One Big Beautiful Bill Act” was signed into law, enacting significant changes to U.S. federal income tax rules affecting corporations, such as the ability to immediately deduct domestic research and development costs, restoration of elective 100 percent bonus depreciation for qualified property and changes related to the international tax provisions. We are currently assessing the impact to our consolidated financial statements.
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