20. INCOME TAXES 

The following is a summary of U.S. and non-U.S. provisions for current and deferred income tax expense from continuing operations (dollars in millions):

Huntsman Corporation

Huntsman International

We have elected to prospectively adopt ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. 

The following provides a disaggregation of income taxes paid, net of refunds received, by U.S. federal and state income taxes and foreign income taxes for the year ended December 31, 2025 in accordance with the guidance in ASU No. 2023-09 (dollars in millions):

The following schedules reconcile the differences between U.S. federal income taxes at the U.S. statutory rate to our provision for income taxes from continuing operations for the year ended December 31, 2025 in accordance with the guidance in ASU No. 2023-09 (dollars in millions):

Huntsman Corporation

Huntsman International

The following schedules reconcile the differences between U.S. federal income taxes at the U.S. statutory rate to our provision for income taxes from continuing operations for the years ended December 31, 2024 and 2023 in accordance with the guidance prior to the adoption of ASU No. 2023-09 (dollars in millions):

Huntsman Corporation

Huntsman International

During 2024, the weighted average statutory rate for countries with pre-tax income (primarily our operations in China (25% statutory rate) and Luxembourg (25% statutory rate)) was offset by the weighted average statutory rate for countries with pre-tax losses, resulting in a net tax benefit of $4 million as compared to the 21% U.S. statutory rate reflected in the reconciliation above. During 2023, the weighted average statutory rate for countries with pre-tax income (primarily our operations in China (25% statutory rate), Germany (30% statutory rate) and Luxembourg (25% statutory rate)) was offset by the weighted average statutory rate for countries with pre-tax losses, resulting in an immaterial difference as compared to the 21% U.S. statutory rate reflected in the reconciliation above. The amounts for 2025 are reflected in the reconciliations of 2025 above.

Under the U.S. Tax Reform Act’s global intangible low-taxed income (“GILTI”) provision, our non-U.S. operations are generally subject to U.S. tax. We have elected to treat the GILTI as a current-period expense when incurred. The stated purpose of the GILTI rules is to generate additional U.S. tax related to income in non-U.S. jurisdictions, which incur less than a blended 14% (13.125% for years before 2025) non-U.S. tax rate. Our non-U.S. income is subject to a blended rate greater than 14% and 13.125%; however, in practice, the GILTI regulations result in additional tax liability from expense allocations which limit our ability to utilize foreign tax credits against the GILTI inclusion. For 2024 and 2023, we incurred a tax benefit of $6 million and tax expense of $3 million, respectively, resulting from these expense allocations, net of other U.S. taxation on foreign operations and foreign tax credits. The amounts for 2025 are reflected in the reconciliations of 2025 above.

On July 4, 2025, the U.S. enacted tax reform legislation through the One Big Beautiful Bill Act (“OBBBA”). Included in this legislation are provisions that allow for the immediate expensing of domestic U.S. research and development expenses, immediate expensing of certain capital expenditures, changes to the interest expense limitation and other changes to the U.S. taxation of profits derived from foreign operations. OBBBA did not have a material impact on our consolidated financial statements.

The components of (loss) income from continuing operations before income taxes were as follows (dollars in millions):

Huntsman Corporation

Huntsman International

Components of deferred income tax assets and liabilities were as follows (dollars in millions):

Huntsman Corporation

Huntsman International

We evaluate deferred tax assets to determine whether it is more likely than not that they will be realized. Valuation allowances are reviewed each period on a tax jurisdiction basis and analyzed to determine whether there is sufficient positive or negative evidence to support a change in judgment about the realizability of the related deferred tax assets. These conclusions require significant judgment. In evaluating the objective evidence that historical results provide, we consider cumulative income or losses during the applicable three-year period. Cumulative losses incurred over the three-year period limit our ability to consider other evidence such as our projections for the future. Our judgments regarding valuation allowances are also influenced by factors outside of business results, including the costs and risks associated with any tax planning associated with utilizing a deferred tax asset.

During 2025, we recorded a discrete release of valuation allowances of approximately $8 million following the announced closure of our Moers, Germany facility. As a result of our Moers facility closure, there is sufficient positive evidence that the applicable Germany tax filing group (without our Moers facility) is more likely than not to realize the group deferred tax assets. We anticipate that the losses from our Moers facility closure will more likely than not be unavailable to any of our continuing German tax filing groups and we continue to have a full valuation allowance against these net deferred tax assets. The valuation allowance of $10 million on the entire net deferred tax asset of the German tax filing group that included our Moers, Germany facility, was established in 2024 due to the negative economic conditions that led to the facility closure. During 2025 and 2024, we also established $9 million and $13 million of significant valuation allowances, respectively, on certain net deferred tax assets in Luxembourg as a result of changes in estimated future taxable income resulting from decreased intercompany receivables and, therefore, decreased income in Luxembourg, our primary treasury center outside of the U.S. We also had miscellaneous non-significant valuation allowance establishments totaling $4 million in 2025 and $6 million in 2024. We established a $14 million valuation allowance against the entire net deferred tax asset in the U.K. as of December 31, 2023.

We have gross net operating losses (“NOLs”) of $1,344 million ($319 million tax-effected) in various non-U.S. jurisdictions. While the majority of the non-U.S. NOLs have no expiration date, $62 million ($11 million tax-effected) have a limited life (of which $11 million ($3 million tax-effected) are subject to a valuation allowance), of which none are scheduled to expire in 2026. We had no NOLs expire unused in 2025. 

We have gross U.S. federal NOLs of $440 million ($92 million tax-effected), the majority of which are not subject to expiration. We expect to be able to utilize all of these NOLs, and therefore they are not subject to a valuation allowance.

Included in the $1,344 million of gross non-U.S. NOLs is $151 million ($36 million tax-effected) attributable to our Luxembourg entities. As of December 31, 2025, due to the uncertainty surrounding the realization of the benefits of these losses, there is a valuation allowance of $24 million against these net tax-effected NOLs of $36 million.

We have $9 million tax-effected federal and state capital loss carryovers, all of which are subject to a valuation allowance. Our capital loss carryovers may only be utilized against capital gains and have a 5-year carryforward period, generally expiring at the end of 2028. 

We have gross U.S. federal deferred interest deductions of $219 million ($46 million tax-effected), which are limited to deduction of 30% of taxable EBITDA and do not expire. We expect to be able to utilize all of these deferred interest deductions and, therefore, they are not subject to a valuation allowance. We also have deferred interest deductions in the Netherlands of $80 million tax-effected, which are limited to a deduction of 24.5% of taxable EBITDA, and which are subject to a full valuation allowance.

Uncertainties regarding expected future income in certain jurisdictions could affect the realization of deferred tax assets in those jurisdictions and result in additional valuation allowances in future periods, or, in the case of unexpected pre-tax earnings, the release of valuation allowances in future periods.

The following is a summary of changes in our valuation allowances (dollars in millions):

Huntsman Corporation

Huntsman International

The following is a reconciliation of our unrecognized tax benefits (dollars in millions):

As of December 31, 2025 and 2024, the amount of unrecognized tax benefits (not including interest and penalties) which, if recognized, would affect the effective tax rate is $5 million and $2 million, respectively. 

During 2025, we concluded and settled tax examinations in the U.S. (federal and various states), China, France, Germany and Hong Kong. During 2024, we concluded and settled tax examinations in the U.S. (federal and various states), Belgium, China, Germany and Italy. During 2023, we concluded and settled tax examinations in the U.S. (federal and various states), Germany, Indonesia, Singapore and Thailand.

During 2025, for unrecognized tax benefits that impact tax expense, we recorded a net increase in unrecognized tax benefits with a corresponding income tax expense (not including interest and penalties) of $3 million. During 2024, for unrecognized tax benefits that impact tax expense, we recorded no net change. During 2023, for unrecognized tax benefits that impact tax expense, we recorded a net decrease in unrecognized tax benefits with a corresponding income tax benefit (not including interest and penalties) of $1 million.

We recognized accrued interest related to unrecognized tax benefits in income tax expense as provided below (dollars in millions):

We conduct business globally, and as a result, we file income tax returns in U.S. federal, various U.S. state and various non-U.S. jurisdictions. The following table summarizes the tax years that remain subject to examination by major tax jurisdictions:

Certain of our U.S. and non-U.S. income tax returns are currently under various stages of audit by applicable tax authorities and the amounts ultimately agreed upon in resolution of the issues raised may differ materially from the amounts accrued.

In connection with the provisions of U.S. Tax Reform, all non-U.S. earnings have generally been subject to U.S. tax and may be repatriated without incurring additional U.S. tax liability. Such repatriation may potentially be subject to limited foreign withholding taxes. We have accrued withholding taxes in countries where we do intend to repatriate some or all of the local retained earnings. For all other amounts and countries, we intend to continue to invest our retained earnings indefinitely and therefore not incur any significant additional taxes on those amounts.