Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

Schedule of The Provision For Income Taxes

The table below presents the components of the provision for income taxes for the periods indicated.


	Year-Ended December 31,
	2025		2024		2023

	(in millions)

Income before provision for income taxes
Domestic	$	3,662	$	2,786	$	2,316
Foreign		1,109		909		753
Total	$	4,771	$	3,695	$	3,069

Current
Federal	$	141	$	133	$	104
State and local		36		22		14
Foreign		196		135		109
Total current		373		290		227
Deferred
Federal		43		8		27
State and local		1		(9)		4
Foreign		(3)		(1)		(1)
Total deferred		41		(2)		30
	$	414	$	288	$	257

Reconciliation of The Statutory U.S. Federal Income Tax Rate Of 21% To The Company's Effective Tax Rate

The table below presents a reconciliation of the statutory U.S. Federal income tax rate of 21% to the Company’s effective tax rate for the periods indicated.


	December 31, 2025				December 31, 2024				December 31, 2023
	Amount				Amount				Amount
	($ millions)		Percentage		($ millions)		Percentage		($ millions)		Percentage

U.S. Federal statutory tax rate	$	1,002		21.0%	$	776		21.0%	$	645		21.0%
State and local income taxes, net of federal income taxes		22		0.5%		8		0.2%		21		0.7%
Foreign tax effects
Hong Kong 1						(48)		-1.3%		(39)		-1.3%
Other foreign rate differential		(37)		-0.8%		(7)		-0.2%		(13)		-0.4%
Effect of cross-border tax laws		(14)		-0.3%		—		0.0%		1		0.0%
Tax credits		(1)		0.0%		—		0.0%		(1)		0.0%
Changes in valuation allowances		(1)		0.0%		—		0.0%		—		0.0%
Nontaxable or nondeductible items		(6)		-0.1%		(3)		-0.1%		2		0.1%
Changes in unrecognized tax benefits		10		0.2%		1		0.0%		—		0.0%
Other adjustments
Flow through income allocated to noncontrolling interest		(557)		-11.7%		(433)		-11.7%		(359)		-11.7%
Other miscellaneous		(4)		-0.1%		(6)		-0.2%		—		0.0%
Effective income tax rate	$	414		8.7%	$	288		7.8%	$	257		8.4%

(1)

The foreign rate differential amount for Hong Kong for the year ended December 31, 2025 does not meet the 5% disaggregation threshold and is therefore included in "Other foreign rate differential" amount.

Significant Components of The Company's Deferred Tax Assets (Liabilities)

The table below presents significant components of the Company’s deferred tax assets and liabilities, which are reported in "Other assets" and in "Accounts payable, accrued expenses and other liabilities", respectively, in the consolidated statements of financial condition for the periods indicated.


	December 31,
	2025		2024		2023

	(in millions)

Deferred tax assets
Arising from the acquisition of interests in IBG LLC	$	222	$	196	$	197
Deferred compensation		22		19		17
Other		28		35		31
Total deferred tax assets		272		250		245
Deferred tax liabilities
Foreign		—		3		4
Other		23		10		10
Total deferred tax liabilities		23		13		14
Net deferred tax assets	$	249	$	237	$	231

Schedule of Cash Taxes Paid to U.S. Federal, State and Non-U.S.

The table below presents the cash taxes paid to U.S. federal, state and non-U.S. for the periods indicated.


	December 31,
	2025		2024

	(in millions)

Cash taxes paid
Federal	$	147	$	140
State		21		8
Foreign
Canada		42		43
Ireland		40		23
Hong Kong		26		31
All other foreign		40		34
Total cash taxes paid	$	316	$	279