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Income Taxes | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The components of the Company’s provision for income taxes for the years ended December 31, 2024, 2023 and 2022 are presented below.
Components of Income (Loss) Before Income Taxes | Years Ended December 31,
(In millions) | 2024 |  | 2023 |  | 2022
United States | $ | (150) |  |  | $ | (90) |  |  | $ | (590) |
Outside of the U.S. | 26 |  |  | 30 |  |  | 25 |
| $ | (124) |  |  | $ | (60) |  |  | $ | (565) |
Income Tax Provision (Benefit) from Continuing Operations | Years Ended December 31,
(In millions) | 2024 |  | 2023 |  | 2022
United States |  |  |  |  |
Current |  |  |  |  |
Federal | $ | 38 |  |  | $ | — |  |  | $ | — |
State & Local | 27 |  |  | 23 |  |  | 7 |
Deferred |  |  |  |  |
Federal | 36 |  |  | (754) |  |  | (57) |
State & Local | (23) |  |  | (166) |  |  | 2 |
Outside of the U.S. |  |  |  |  |
Current | 10 |  |  | 9 |  |  | 7 |
Deferred | (1) |  |  | — |  |  | — |
| $ | 87 |  |  | $ | (888) |  |  | $ | (41) |
The following is an allocation of the total income tax provision (benefit) for the years ended December 31, 2024, 2023 and 2022:
| Years Ended December 31,
(In millions) | 2024 |  | 2023 |  | 2022
Income tax provision (benefit) applicable to: |  |  |  |  |
Income from continuing operations | $ | 87 |  |  | $ | (888) |  |  | $ | (41) |
Discontinued operations | — |  |  | — |  |  | (50) |
Additional paid-in capital | — |  |  | (12) |  |  | — |
Other comprehensive income | — |  |  | 1 |  |  | (30) |
The following is a reconciliation of the statutory federal income tax of 21% to the Company’s reported income tax provision (benefit) for the years ended December 31, 2024, 2023 and 2022:
| Years Ended December 31,
(In millions) | 2024 |  | 2023 |  | 2022
Federal statutory income tax provision (benefit) | $ | (26) |  |  | $ | (13) |  |  | $ | (118) |
State and local income tax provision (benefit) | (16) |  |  | (13) |  |  | 1 |
Nondeductible compensation and benefits | 17 |  |  | 16 |  |  | 13 |
Goodwill impairment and write offs | 53 |  |  | 3 |  |  | 3 |
Increase (decrease) in uncertain tax positions | 1 |  |  | — |  |  | (1) |
Change in tax rates from change in tax law before valuation allowance | 38 |  |  | 25 |  |  | 86 |
Foreign taxes | 1 |  |  | 3 |  |  | 6 |
Deferred tax adjustment related to William Hill acquisition | — |  |  | — |  |  | 30 |
Minority interests | (14) |  |  | (9) |  |  | 3 |
Valuation allowance | 36 |  |  | (889) |  |  | (55) |
Tax credits | (10) |  |  | (14) |  |  | (10) |
Other | 7 |  |  | 3 |  |  | 1 |
Reported income tax provision (benefit) | $ | 87 |  |  | $ | (888) |  |  | $ | (41) |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s net deferred taxes at December 31, 2024 and 2023 are as follows:
| As of December 31,
(In millions) | 2024 |  | 2023
Deferred tax assets: |  |  |
Loss carryforwards | $ | 391 |  |  | $ | 569 |
Excess business interest expense | 499 |  |  | 399 |
Credit carryforwards | 39 |  |  | 141 |
Financing obligation | 2,673 |  |  | 2,644 |
Long-term lease obligation | 202 |  |  | 208 |
Other | 237 |  |  | 233 |
| 4,041 |  |  | 4,194 |
Deferred tax liabilities: |  |  |
Identified intangibles | (677) |  |  | (759) |
Fixed assets | (2,214) |  |  | (2,295) |
Right-of-use assets | (168) |  |  | (174) |
Other | (94) |  |  | (101) |
| (3,153) |  |  | (3,329) |
Valuation allowance | (956) |  |  | (920) |
Net deferred tax liabilities | $ | (68) |  |  | $ | (55) |
Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use existing deferred tax assets. During the second quarter of 2023, the Company evaluated its forecasted adjusted taxable income and objectively verifiable evidence and placed substantial weight on its 2022 and 2023 quarterly earnings, adjusted for non-recurring items, including the interest expense disallowed under current tax law. Accordingly, the Company determined it was more likely than not that a portion of the federal and state deferred tax assets will be realized and, as a result, during the second quarter of 2023, the Company reversed the valuation allowance related to these deferred tax assets and recorded an income tax benefit of $940 million. The Company is still carrying a valuation allowance on certain federal and state deferred tax assets that are not more likely than not to be realized in the future. The Company has assessed the changes to the valuation allowance, including realization of the disallowed interest expense deferred tax asset, using the integrated approach. As of December 31, 2024, the Company had federal and state net operating loss carryforwards of $52 million and $9.1 billion, respectively, and federal general business tax credit and research tax credit carryforwards of $89 million, which will expire on various dates as follows:
Year of Expiration | Net Operating Losses |  | Tax Credits
(In millions) | Federal |  | States |  | Federal
2025-2029 | $ | — |  |  | $ | 955 |  |  | $ | — |
2030-2034 | 33 |  |  | 2,571 |  |  | — |
2035-2044 | — |  |  | 3,173 |  |  | 89 |
Do not expire | 19 |  |  | 2,391 |  |  | — |
| $ | 52 |  |  | $ | 9,090 |  |  | $ | 89 |
In general, Section 382 of the Internal Revenue Code provides an annual limitation with respect to the ability of a corporation to utilize its net operating loss carryovers, as well as certain built-in losses, against future taxable income in the event of a change in ownership. It is unlikely that the limitation will adversely affect the Company’s ability to utilize its net operating loss carryovers against its future taxable income.
Reconciliation of Unrecognized Tax Benefits | Years Ended December 31,
(In millions) | 2024 |  | 2023 |  | 2022
Balance as of beginning of year | $ | 124 |  |  | $ | 128 |  |  | $ | 157 |
Sale of William Hill International | — |  |  | — |  |  | (24) |
Additions based on tax positions related to the current year | — |  |  | — |  |  | 3 |
Additions for tax positions of prior years | 1 |  |  | 1 |  |  | 1 |
Reductions for tax positions for prior years | (9) |  |  | (5) |  |  | (8) |
Expiration of statutes | — |  |  | — |  |  | (1) |
Balance as of end of year | $ | 116 |  |  | $ | 124 |  |  | $ | 128 |
We classify reserves for tax uncertainties within Other long-term liabilities in our Balance Sheets, separate from any related income tax payable, deferred tax asset, or deferred tax liability. Reserve amounts relate to any potential income tax liabilities resulting from uncertain tax positions as well as potential interest or penalties associated with those liabilities. We accrue interest and penalties related to unrecognized tax benefits in income tax expense. During 2024, we decreased our unrecognized tax benefits by $8 million, primarily due to a reduction in the Louisiana state tax rate due to a change in tax law. During 2023, we decreased our unrecognized tax benefits by $4 million, primarily due to the noncash settlement of a state audit. During 2022, we decreased our unrecognized tax benefits by $29 million, primarily due to the sale of William Hill International. There was an accrual for the payment of interest and penalties of $1 million as of December 31, 2024 and no accrual for the payment of interest and penalties as of December 31, 2023. Included in the balances of unrecognized tax benefits as of December 31, 2024 and December 31, 2023 was $106 million and $112 million, respectively, of unrecognized tax benefits that, if recognized, would impact the effective tax rate. In 2021, the Organization for Economic Co-operation and Development (the “OECD”) established an Inclusive Framework on Base Erosion and Profit Shifting and agreed on a two-pillar solution (“Pillar Two”) to global taxation, focusing on global profit allocation and a 15% global minimum effective tax rate. The OECD issued Pillar Two model rules and continues to release guidance on these rules. While the US has not yet adopted the Pillar Two rules, various other countries around the world are enacting legislation. We will continue to analyze the law to determine potential impacts. We currently do not expect the Framework to have a material impact on our effective tax rate or our financial statements. The Company, including its subsidiaries, files tax returns with federal, state and foreign jurisdictions. The Company does not have tax sharing agreements with the other members within the consolidated group. With few exceptions, the Company is no longer subject to US federal or state and local tax assessments by tax authorities for years before 2021. We believe that it is reasonably possible that the unrecognized tax benefits liability will not materially change within the next 12 months. Audit outcomes and the timing of audit settlements are subject to significant uncertainty. Although we believe that adequate provision has been made for such issues, there is the possibility that the ultimate resolution of such issues could have an adverse effect on our earnings. Conversely, if these issues are resolved favorably in the future, the related provision would be reduced, thus having a favorable impact on earnings.

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