Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Schedule of Pre-tax Income, Tax by Jurisdiction

Pre-tax income was taxed in the following jurisdictions (in millions):


	Year Ended December 31,
	2025		2024		2023
Domestic	$	742.5	$	829.2	$	705.9
Foreign		99.5		73.8		91.7
	$	842.0	$	903.0	$	797.6

Schedule of Components of Provision for (Benefit from) Income Taxes

Significant components of the provision for income taxes were as follows (in millions):


	Year Ended December 31,
	2025			2024			2023
Allocated to Income Before Losses of Unconsolidated Affiliates
Current:
Federal	$	72.9		$	173.6		$	268.4
Foreign		37.8			22.1			29.9
State		27.6			32.2			52.1
Total current		138.3			227.9			350.4
Deferred:
Federal		55.4			(16.8	)		(126.0	)
Foreign		(4.3	)		3.7			(8.0	)
State		2.1			(4.8	)		(26.4	)
Total deferred		53.2			(17.9	)		(160.4	)
	$	191.5		$	210.0		$	190.0
Allocated to Other Comprehensive Income (Loss)
Deferred federal, state and foreign	$	1.0		$	(11.3	)	$	1.8

Schedule of Reconciliation of Income Tax Computed at U.S. Federal Statutory Tax Rates to Income Tax Expense

The reconciliation of income tax computed at the U.S. federal statutory tax rates to income tax expense was:


	Year Ended December 31,
	2025					2024					2023
Effective Rate Reconciliation:
U.S. federal tax rate	$	176.8		21.0	%	$	189.6		21.0	%	$	167.5		21.0	%
State income taxes, net		24.5		2.9	%		21.1		2.3	%		20.5		2.6	%
Foreign tax effects		14.9		1.8	%		12.3		1.4	%		11.9		1.5	%
Effects of current-period tax law changes		3.6		0.4	%		—		0.0	%		—		0.0	%
Effects of cross-border tax laws		(11.4	)	-1.4	%		(13.4	)	-1.5	%		(7.1	)	-0.9	%
Tax credits		(7.0	)	-0.7	%		(8.5	)	-0.9	%		(7.6	)	-1.0	%
Changes in valuation allowances		1.2		0.1	%		3.1		0.3	%		3.7		0.5	%
Nontaxable or nondeductible items		4.9		0.6	%		0.9		0.1	%		3.8		0.5	%
Changes in unrecognized tax benefits		(19.8	)	-2.4	%		6.2		0.7	%		1.4		0.2	%
Other adjustments		3.8		0.4	%		(1.3	)	-0.1	%		(4.1	)	-0.6	%
	$	191.5		22.7	%	$	210.0		23.3	%	$	190.0		23.8	%

Schedule of Cash Paid for Income Taxes, Net of Refunds

Cash paid for income taxes, net of refunds was as follows (in millions):


	Year Ended December 31,
	2025		2024		2023
Federal	$	109.5	$	320.8	$	91.5
State		25.5		51.0		54.0
Foreign		24.9		26.7		16.2
Cash paid for income taxes, net of refunds	$	159.9	$	398.5	$	161.7

Components of Deferred Income Tax Assets and Liabilities

Deferred income tax assets and liabilities were comprised of the following (in millions):


	December 31,
	2025			2024
Deferred tax assets:
Customer advances	$	185.4		$	183.5
Research and development		79.2			132.8
Losses and credits		52.3			44.8
Inventories		41.3			15.9
Employee benefit plans		30.3			29.0
Payroll-related obligations		23.5			29.8
Accrued warranties		19.4			16.0
Other		70.3			64.2
Gross deferred tax assets		501.7			516.0
Less valuation allowance		(21.4	)		(17.9	)
Deferred tax assets, net		480.3			498.1
Deferred tax liabilities:
Property, plant and equipment		(144.5	)		(111.3	)
Intangible assets		(77.7	)		(76.1	)
Other		(82.8	)		(78.6	)
Deferred tax liabilities		(305.0	)		(266.0	)
Net deferred tax asset	$	175.3		$	232.1

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted in the United States. The OBBBA includes provisions to expense previously deferred domestic research and development costs, increase bonus depreciation and modify the international tax framework. The changes to the deferred taxes for "research and development" and "property, plant, and equipment" reflect the impacts resulting from OBBBA.

Schedule of Classification of Deferred Tax Asset in Consolidated Balance Sheets

The net deferred tax asset is classified in the Consolidated Balance Sheets as follows (in millions):


	December 31,
	2025			2024
Non-current net deferred tax asset	$	201.0		$	259.0
Non-current net deferred tax liability		(25.7	)		(26.9	)
Net deferred tax asset	$	175.3		$	232.1

Schedule of Reconciliation of Unrecognized Tax Benefits

A reconciliation of gross unrecognized tax benefits, excluding interest and penalties, was as follows (in millions):


	Year Ended December 31,
	2025			2024			2023
Balance at beginning of period	$	61.6		$	64.3		$	98.8
Additions for tax positions related to current year		0.9			2.5			5.0
Additions for tax positions related to prior years		1.0			3.0			0.7
Reductions for tax positions related to prior years		(2.1	)		(5.1	)		(36.5	)
Settlements with taxing authority		(17.0	)		—			—
Foreign currency translation		1.5			(2.2	)		0.3
Lapse of statutes of limitations		(0.4	)		(0.9	)		(4.0	)
Balance at end of period	$	45.5		$	61.6		$	64.3

Schedule of Tax Years Open for Examination Under Applicable Statutes

As of December 31, 2025, tax years open for examination under applicable statutes were as follows:


Tax Jurisdiction:		Open Tax Years
Australia		2021 - 2025
Belgium		2023 - 2025
Brazil		2021 - 2025
Canada		2021 - 2025
China		2020 - 2025
Mexico		2021 - 2025
Netherlands		2019 - 2025
United Kingdom		2024 - 2025
Other Non-U.S. Countries		2018 - 2025
United States (federal general)		2019 - 2025
United States (state and local)		2015 - 2025

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