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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The Company recognizes deferred income tax assets, net of applicable reserves, related to net operating losses, tax credit carryforwards and certain temporary differences. The Company recognizes future tax benefits to the extent that realization of such benefit is more likely than not. Otherwise, a valuation allowance is applied.

The domestic and foreign components of income before income taxes were as follows:

 
Year Ended December 31,
 202420232022
 (In thousands)
Domestic operations$256,890 $1,214,888 $4,251,418 
Foreign operations860,175 257,875 (3,347,619)
 $1,117,065 $1,472,763 $903,799 
The components of the provision for income taxes were as follows:
 
Year Ended December 31,
 202420232022
Federal:(In thousands)
Current$126,933 $259,128 $206,426 
Deferred (excluding separate components)(22,919)48,363 678,371 
Deferred – valuation allowance change
(9,506)(153,768)(5,346)
Other noncurrent1,458 (10,969)(18,326)
Provision for federal income taxes95,966 142,754 861,125 
State:
Current10,477 24,931 10,389 
Deferred (excluding separate components)(3,731)(11,206)33,878 
Deferred – operating loss carryforward
(880)12,219 15,442 
Deferred – valuation allowance change
3,177 2,140 2,345 
Provision for state income taxes9,043 28,084 62,054 
Foreign:
Current(2,363)(223)2,259 
Deferred (excluding separate components)(4,250)(5,611)(311,614)
Deferred – operating loss carryforward
(39,769)57,485 (6,331)
Deferred – valuation allowance change
(6,170)(64,650)89,575 
Benefit for foreign income taxes(52,552)(12,999)(226,111)
 $52,457 $157,839 $697,068 

A reconciliation of the federal income tax statutory rate and the Company’s effective tax rate was as follows:
 
Year Ended December 31,
 202420232022
Federal income tax statutory rate21.0 %21.0 %21.0 %
Noncontrolling interest(0.2)(0.1)(2.4)
Foreign income/losses taxed at other than U.S. statutory rate(19.5)(3.6)53.3 
Federal valuation allowance(0.9)(10.4)(0.6)
State taxes, net0.6 1.5 5.5 
General business credits(1.5)(1.2)(1.5)
Incremental U.S. tax on foreign earnings4.5 2.4 — 
Permanent and other items0.7 1.1 1.8 
 4.7 %10.7 %77.1 %
The tax-effected components of the Company’s net deferred tax liability were as follows:
 December 31,
 20242023
Deferred tax assets – federal and state:(In thousands)
Net operating loss carryforward$14,193 $13,498 
Accruals, reserves and other66,328 52,854 
Lease liabilities5,750,744 5,703,953 
Tax credits1,008,363 1,788,001 
 6,839,628 7,558,306 
Less: Valuation allowance(867,416)(1,598,291)
 5,972,212 5,960,015 
Deferred tax assets – foreign:
Net operating loss carryforward180,970 141,201 
Accruals, reserves and other6,673 9,266 
Property and equipment37,832 33,944 
Lease liabilities1,488 1,270 
 226,963 185,681 
Less: Valuation allowance(173,984)(180,155)
 52,979 5,526 
Total deferred tax assets$6,025,191 $5,965,541 
Deferred tax liabilities – federal and state:
Property and equipment$(438,455)$(389,854)
Investments in unconsolidated affiliates(583,865)(584,448)
Investment in equity securities(2,232,601)(2,234,754)
ROU assets(5,283,821)(5,390,561)
Intangibles(237,107)(197,893)
 (8,775,849)(8,797,510)
Deferred tax liabilities – foreign:
Intangibles
(21,414)(29,028)
 (21,414)(29,028)
Total deferred tax liability(8,797,263)(8,826,538)
Net deferred tax liability$(2,772,072)$(2,860,997)

Deferred income tax valuation allowance consisted of the following:
Balance at Beginning of PeriodIncreaseDecreaseBalance at End of Period
Deferred income tax valuation allowance:(In thousands)
Year Ended December 31, 2024
$1,778,446 $— $(737,046)$1,041,400 
Year Ended December 31, 2023
2,886,575 — (1,108,129)1,778,446 
Year Ended December 31, 2022
2,884,262 2,313 — 2,886,575 

The Company has recorded a valuation allowance of $855 million on its foreign tax credit (“FTC”) carryover of $1.0 billion as of December 31, 2024, resulting in an FTC net deferred tax asset of approximately $153 million. The FTCs are attributable to the Macau Special Gaming Tax, which is 35% of gross gaming revenue in Macau. The Company believes payment of the Macau Special Gaming Tax qualifies as a tax paid in lieu of an income tax that is creditable against U.S. taxes. While the Company generally does not expect to generate new FTC carryovers after the year ended December 31, 2017, it will be able to utilize its existing FTC carryovers only to the extent it has active foreign source income during the applicable 10-year FTC carryforward period. The Company relies on future U.S.-source operating income in assessing,
future FTC realization during the applicable 10-year FTC carryover period. The FTC carryovers will expire if not utilized as follows: $674 million in 2025; $134 million in 2026; and $200 million in 2027.

The Company’s assessment of the realization of its FTC deferred tax asset is based on available evidence, including assumptions concerning future U.S. operating profits and foreign source income. As a result, significant judgment is required in assessing the possible need for a valuation allowance and changes to such assumptions could result in a material change in the valuation allowance with a corresponding impact on the provision for income taxes in the period including such change.

On January 29, 2024, MGM Grand Paradise was granted an extension of its Complementary Tax Exemption for the period of January 1, 2023 through December 31, 2027. The measurement of Macau deferred tax assets and liabilities as of December 31, 2023 was based on enacted law as of that date and assumed MGM Grand Paradise would pay the complementary tax on gaming profits for all periods beyond December 31, 2022. The impact of the retroactive Complementary Tax Exemption was reversed in 2024.

At December 31, 2024, gross foreign net operating loss carryforwards consisted primarily of a complementary tax exempt net operating loss (“NOL”) carryforward of $1.3 billion at MGM Grand Paradise resulting from non-gaming operations that will expire if not utilized in years 2025 through 2027.

As of December 31, 2024, there is a $174 million valuation allowance on certain foreign deferred tax assets, which relates primarily to MGM Grand Paradise’s NOLs.

The Company has NOLs in some of the states in which it operates that total $234 million as of December 31, 2024, which equates to deferred tax assets of $14 million after federal tax effect and before valuation allowance. The NOL carryforwards in most of the states will expire, if not utilized, between 2025 through 2042. Otherwise, the NOL carryforward can be carried forward indefinitely. The Company has provided a valuation allowance of $12 million on some of its state deferred tax assets for the NOLs described above.

The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was not material at December 31, 2024 and 2023, respectively. The Company recognizes interest and penalties related to unrecognized tax benefits as well as overpayments and underpayment of income taxes in income tax expense, which were not material for each of the periods presented.

The Company files income tax returns in the U.S. federal jurisdiction, various state and local jurisdictions, and foreign jurisdictions. As of December 31, 2024, other than adjustments resulting from the federal and state income tax audits discussed herein, the federal, state, and local tax jurisdictions in which the Company files tax returns generally cannot assess tax with respect to years ended prior to 2020. However, NOLs generated or utilized in earlier years may be subject to adjustment.

The Company’s 2015 through 2019 U.S. consolidated federal income tax returns are currently under examination by the IRS and the examination findings are under review by the Joint Committee on Taxation. Such review and examination are expected to be complete and close during the first half of 2025. The Company anticipates receiving its refund claim without any material adjustments upon resolution of the examination.

In 2024, the Company’s suit initiated against the state of Michigan in 2022 was resolved with no material adjustments. In addition, the state of Michigan cancelled the examination of the Company’s unitary income tax returns filed in the state for tax years 2019 through 2021.