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Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Significant components of the Income tax (expense) benefit on earnings from continuing operations were as follows:
For the years ended December 31,202420232022
Current:
United States$(6,653)$(5,488)$(33,097)
Foreign(150,850)(187,971)(152,931)
State— — (273)
Total current(157,503)(193,459)(186,301)
Deferred:
United States— — 4,663 
Foreign38,524 55,856 (3,794)
State— — 41 
Total deferred38,524 55,856 910 
Total income tax expense$(118,979)$(137,603)$(185,391)

For the years ended December 31, 2024, 2023 and 2022, foreign income from continuing operations before income taxes was $478,331, $310,589, and $319,515, respectively. For the years ended December 31, 2024, 2023 and 2022, domestic loss from continuing operations before income taxes was $(63,847), $(56,128), and $(73,665), respectively.
Significant components of deferred tax assets and liabilities were as follows:
December 31,20242023
Deferred tax assets:
Net operating loss and tax credits carryforwards$50,317 $213,222 
Operating leases92,084 119,529 
Depreciation46,236 56,936 
Interest42,448 36,067 
Deferred compensation11,275 12,202 
Deferred revenue16,978 17,851 
Nondeductible reserves13,879 17,634 
Allowance for doubtful accounts10,399 8,661 
Unrealized loss— 8,362 
Total deferred tax assets283,616 490,464 
Deferred tax liabilities:
Operating leases82,421 107,879 
Investment in subsidiaries2,358 44,154 
Amortization of intangible assets45,141 52,073 
Deferred gain on Walden— 440 
Unrealized gain2,469 — 
Total deferred tax liabilities132,389 204,546 
Net deferred tax assets151,227 285,918 
Valuation allowance for deferred tax assets(102,837)(270,982)
Net deferred tax assets$48,390 $14,936 

Laureate does not provide deferred taxes on the portion of its unremitted earnings attributable to international companies that have been considered to be reinvested indefinitely. As of December 31, 2024, undistributed earnings from foreign subsidiaries totaled $431,000. If the Company were to remove its assertion and distribute the remaining unremitted earnings, we would record approximately $18,700 in additional deferred tax liabilities. The amount of additional deferred tax liabilities recognized could increase if our expectations change based on future developments.

As of December 31, 2024, on tax-effected basis, the Company has $12,469 of U.S. federal net operating loss carryforwards, $3,548 of US state net operating loss carryforwards that do not expire and $20,973 of US state net operating loss carryforwards that will expire by 2040. In addition, on a tax-effected basis, the Company has $4,652 of foreign net operating loss carryforwards that expire from 2025 to 2034 and $4,812 of foreign net operating loss carryforwards that do not expire as well as $3,863 of tax credit carryforwards that do not expire and $42,448 of interest carryforwards that do not expire.

Most of the deferred tax liability for Investment in subsidiaries was released in 2024 as it was no longer required following the completion of an entity restructuring that received regulatory approval. This resulted in a net deferred tax benefit of approximately $37,900 during the year ended December 31, 2024.

The Company assesses the realizability of deferred tax assets by examining all available evidence, both positive and negative. Accounting guidance restricts the amount of reliance the Company can place on projected taxable income to support the recovery of the deferred tax assets when a company is in a three-year cumulative loss position. A valuation allowance is recorded when the company is not able to identify a source of income to support realization of the deferred tax asset on a more-likely-than-not basis.
The reconciliations of the beginning and ending balances of the valuation allowance on deferred tax assets were as follows:
For the years ended December 31,202420232022
Balance at beginning of period$270,982 $291,722 $283,945 
(Deductions) additions from tax expense from continuing operations(166,396)(22,815)7,972 
Charges to other accounts
Currency translation adjustments(1,749)2,075 (195)
Balance at end of period$102,837 $270,982 $291,722 

The reconciliations of the reported Income tax (expense) benefit to the amount that would result by applying the United States federal statutory tax rate of 21% to income from continuing operations before income taxes were as follows:
For the years ended December 31,202420232022
Tax expense at the United States statutory rate$(87,042)$(53,437)$(51,628)
Internal restructuring transactions(138,516)(30,551)— 
Permanent differences(9,690)1,004 (38,228)
Tax effect of foreign income taxed at higher rate(44,361)(33,790)(40,579)
Change in valuation allowance167,152 (5,273)(11,241)
Effect of tax contingencies(6,394)(6,352)(37,151)
Withholding taxes(8,474)(9,204)(16,275)
Tax credits8,346 — 9,211 
State income tax benefit, net of federal tax effect— — 669 
Other— — (169)
Total income tax expense$(118,979)$(137,603)$(185,391)

Internal restructuring transactions in the rate reconciliation includes the write off of approximately $176,400 and $30,600 of deferred tax assets as a result of subsidiary reorganizations that occurred during the years ended December 31, 2024 and 2023, respectively. These deferred tax assets carried a full valuation allowance and the corresponding reductions in the valuation allowance are included in the change in valuation allowance line item for 2024 and 2023 in the table above. In 2024, the internal restructuring transactions line item also includes the release of a deferred tax liability that was no longer required following the completion of an entity restructuring that received regulatory approval. This resulted in a net deferred tax benefit of approximately $37,900 during the year ended December 31, 2024.

Included within permanent differences in the 2023 rate reconciliation was approximately $5,400 of tax benefit for a change in estimate related to unrealized foreign currency exchange that is fully offset by a corresponding change in the valuation allowance, as well as approximately $3,800 of tax benefit related to the inflationary adjustment for monetary assets, partially offset by approximately $6,700 of non-deductible expenses.

Included within permanent differences in the 2022 rate reconciliation was approximately $7,700 of tax expense from stock option shortfalls, $13,700 of non-deductible scholarship expenses, and $4,200 of taxable income related to intercompany dividends, as well as $11,200 of expense for a change in estimate related to unrealized foreign currency exchange that is fully offset by a corresponding increase in the valuation allowance.

The reconciliations of the beginning and ending amount of unrecognized tax benefits were as follows:
For the years ended December 31,202420232022
Beginning of the period$255,716 $284,929 $257,587 
Additions for tax positions related to prior years1,600 1,337 38,029 
Decreases for tax positions related to prior years(17,324)(30,550)(8,856)
Additions for tax positions related to current year— — 498 
Decreases for unrecognized tax benefits as a result of a lapse in the statute of limitations(1,838)— (2,329)
End of the period$238,154 $255,716 $284,929 
Laureate records interest and penalties related to uncertain tax positions as a component of Income tax expense. During the years ended December 31, 2024, 2023 and 2022, net interest and penalties related to income taxes (decreased)/increased by $(739), $10,155, and $6,828, respectively. Laureate had $31,695 and $32,434 of accrued interest and penalties at December 31, 2024 and 2023, respectively. Approximately $114,142 of unrecognized tax benefits, if recognized, will affect the effective income tax rate. It is reasonably possible that Laureate’s unrecognized tax benefits may decrease within the next 12 months by up to approximately $59,600 as a result of the resolution of outstanding tax matters in various jurisdictions.

Laureate and various subsidiaries file income tax returns in the United States federal jurisdiction, and in various states and foreign jurisdictions. With few exceptions, Laureate is no longer subject to United States federal, state and local, or foreign income tax examinations by tax authorities for years before 2014. United States federal and state statutes are generally open back to 2021; however, the Internal Revenue Service (the IRS) has the ability to challenge 2005 through 2020 net operating loss carryforwards. Statutes of other major jurisdictions are open back to 2021 for Chile, 2019 for Mexico, 2016 for Peru and 2018 for the Netherlands.