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INCOME TAXES | 6 Months Ended
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Jun. 30, 2025
Income Tax Disclosure [Abstract] |
INCOME TAXES | NOTE 12. INCOME TAXES The effective tax rate for the three months ended June 30, 2025 included a net $3.3 million tax benefit, primarily associated with U.S. federal investment tax credits and a release of valuation allowances on domestic state net operating losses and tax credits, partially offset by an expense from prior year tax positions and a change in tax contingencies. Excluding these items, the effective tax rate for the three months ended June 30, 2025 of 10.3% was lower than the 21.0% U.S. federal statutory rate primarily due to state income tax, favorable permanent salt depletion deductions, non-taxable exchange rate results and a favorable foreign rate differential, partially offset by foreign income inclusions. The effective tax rate for the three months ended June 30, 2024 included a net $0.6 million tax benefit, primarily associated with stock-based compensation and U.S. federal tax credits purchased at a discount, partially offset by an expense from prior year tax positions and a change in tax contingencies. Excluding these items, the effective tax rate for the three months ended June 30, 2024 of 25.8% was higher than the 21.0% U.S. federal statutory rate primarily due to state income tax and foreign income inclusions, partially offset by favorable permanent salt depletion deductions. The effective tax rate for the six months ended June 30, 2025 included a net $2.9 million tax benefit primarily associated with U.S. federal investment tax credits and a release of valuation allowances on domestic state net operating losses and tax credits, partially offset by an expense from prior year tax positions and a change in tax contingencies. Excluding these items, the effective tax rate for the six months ended June 30, 2025 of 4.3% was lower than the 21.0% U.S. federal statutory rate primarily due to state income tax, favorable permanent salt depletion deductions, non-taxable exchange rate results and a favorable foreign rate differential, partially offset by foreign income inclusions. The effective tax rate for the six months ended June 30, 2024 included a net $3.3 million tax benefit, primarily associated with stock-based compensation and U.S. federal tax credits purchased at a discount, partially offset by an expense from prior year tax positions and a change in tax contingencies. Excluding these items, the effective tax rate for the six months ended June 30, 2024 of 25.6% was higher than the 21.0% U.S. federal statutory rate primarily due to state income tax and foreign income inclusions, partially offset by favorable permanent salt depletion deductions. In August 2022, the Inflation Reduction Act (the IRA) was enacted and provides various beneficial credits for energy efficient related manufacturing, transportation and fuels, hydrogen/carbon recapture and renewable energy, which we are evaluating in regard to planned projects. In the second quarter of 2025, Olin realized $22.0 million of investment tax credits via its Hidrogenii joint venture interest and recorded a tax benefit of $2.6 million. On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted in the U.S. This act introduces significant changes to tax law and other areas affecting company operations, including items such as extensions of Tax Cuts and Jobs Act provisions, changes to business interest deductions, modifications to depreciation deductions and impacts on energy tax credits. While the effects of these tax law changes will not be reflected in interim or annual provisions for the period ended June 30, 2025, the Company is evaluating the potential impact of the OBBBA on its financial position, results of operations, and cash flows for future periods. Specific potential impacts that are being assessed include effects on future tax expense, cash flows from operations due to new deductions, or potential impacts on investment decisions. Further details on the impact of this legislation will be provided as the evaluation progresses. As of June 30, 2025, we had $22.3 million of gross unrecognized tax benefits, which would have impacted the effective tax rate, if recognized. The amounts of unrecognized tax benefits were as follows:
| Six Months Ended June 30,
| 2025 |  | 2024
Unrecognized Tax Benefits | ($ in millions)
Balance at beginning of year | $ | 21.1 |  |  | $ | 50.3 |
Increases for prior year tax positions | 1.5 |  |  | 2.7 |
Decreases for prior year tax positions | (0.2) |  |  | (0.4) |
Increases for current year tax positions | 0.7 |  |  | 0.7 |
Decreases due to tax settlements | (0.8) |  |  | (1.0) |
Foreign currency translation adjustments | — |  |  | (1.1) |
Balance at end of period | $ | 22.3 |  |  | $ | 51.2 |
As of June 30, 2025, we believe it is reasonably possible that our total amount of unrecognized tax benefits will decrease by approximately $9.5 million over the next twelve months. The anticipated reduction primarily relates to expected settlements with tax authorities and the expiration of federal, state and foreign statutes of limitation. We operate globally and file income tax returns in numerous jurisdictions. Our tax returns are subject to examination by various federal, state and local tax authorities. Additionally, examinations are ongoing in various states and foreign jurisdictions. We believe we have adequately provided for all tax positions; however, amounts asserted by taxing authorities could be greater than our accrued position. For our primary tax jurisdictions, the tax years that remain subject to examination are as follows:
| Tax Years
U.S. federal income tax | 2020 - 2024
U.S. state income tax | 2015 - 2024
Canadian federal income tax | 2018 - 2024
Brazil | 2019 - 2024
Germany | 2022 - 2024
China | 2015 - 2024
The Netherlands | 2020 - 2024

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