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Income Taxes
 12 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The provision for income taxes for the years ended December 31, 2024, 2023 and 2022 consist of the following:
Year Ended December 31,
202420232022
Current:
Federal
$637 $(282)$(206)
State and local3,328 3,3092,137
Foreign
1,834 1,8391,837
Total current provision for income taxes
$5,799 $4,866 $3,768 
Deferred:
Federal$5,945 $3,730 $4,208 
State and local1,293 (886)1,838
Foreign523 (18)(203)
Total deferred income taxes expense7,761 2,826 5,843 
Total provision for income taxes
$13,560 $7,692 $9,611 
A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows:
Year Ended December 31,
202420232022
Statutory U.S. federal income tax rate21 %21 %21 %
State and local income taxes7 %(17)%3 %
Impact of noncontrolling interests(9)%(37)%(15)%
Foreign income taxes4 %(8)%2 %
Change in tax rates(1)%6 %1 %
Change in unrecognized tax benefits 2 %— %— %
Provision-to-return adjustments— %2 %— %
Change in fair value of warrant liabilities6 %1 %(2)%
Change in valuation allowance(4)%(4)%2 %
Tax receivable agreement liability expense— %(2)%— %
Other1 %2 %(1)%
Effective income tax rate27 %(36)%11 %
Details of the Company’s deferred tax assets and liabilities are as follows:
As of December 31,
20242023
Investment in GCMH$93,045 $92,656 
Unrealized losses — 2,437 
Intangibles and other1,1112,423
Total deferred tax assets before valuation allowance94,156 97,516
Valuation allowance(40,869)(38,122)
Total deferred tax assets$53,287 $59,394 
Right-of-use asset$(612)$(1,096)
Unrealized gains(1,558)— 
Other deferred tax liability(430)— 
Total deferred tax liabilities(1)
(2,600)(1,096)
Deferred tax assets, net(2)
$50,687 $58,298 
___________
(1)     As of December 31, 2024 and 2023, $2.1 million and $1.1 million of deferred tax liabilities, respectively, were offset and presented within deferred tax asset, net in the Consolidated Statements of Financial Condition as these deferred tax assets and liabilities relate to the same jurisdiction.
(2)     As of December 31, 2024 and 2023, $0.5 million and $0.0 million of deferred tax liabilities are presented within accrued expenses and other liabilities in the Consolidated Statements of Financial Condition
GCMG’s sole material asset is its investment in GCMH, which is treated as a partnership for U.S. federal income tax purposes and for purposes of certain jurisdictional income taxes. GCMH’s net taxable income and any related tax credits are passed through to its partners and are included in the partners’ tax returns, even though such net taxable income or tax credits may not have actually been distributed. While GCMG consolidates GCMH for financial reporting purposes, GCMG will be taxed on its share of earnings of GCMH not attributed to the noncontrolling interest holders, which will continue to bear their share of income tax on allocable earnings of GCMH. The income tax burden on the earnings taxed to the noncontrolling interest holders is not reported by the Company in its consolidated financial statements under GAAP. As a result, the Company’s effective tax rate differs materially from the statutory rate. The primary factors impacting the effective tax rate are the allocation of income (loss) to noncontrolling interest as well as state and foreign income taxes paid at the partnership level that are included in income tax expenses.

GCMG has recorded a valuation allowance of approximately $40.9 million and $38.1 million, an increase of $2.8 million, as of December 31, 2024 and 2023, respectively, which is primarily related to its outside partnership basis of its investment in GCMH for the amount of the deferred tax asset that is not expected to be realized.
The Company is subject to taxation in the U.S. and various states and foreign jurisdictions. As of December 31, 2024, tax years for 2024, 2023, 2022, 2021, and 2020 are subject to examination by the tax authorities. With few exceptions, as of December 31, 2024, the Company is no longer subject to U.S. federal, state, local, or foreign examinations by tax authorities for years before 2020.
For the year ended December 31, 2024, GCMG’s unrecognized tax benefits relating to uncertain tax position, excluding related interest and penalties, consisted of the following:
Year Ended December 31,
202420232022
Unrecognized tax benefits, beginning of period$— $— $— 
Gross increases in tax positions in prior periods— — — 
Gross decreases in tax positions in prior periods— — — 
Gross increases in tax positions in current period714 — — 
Lapse of statue of limitations— — — 
Settlements with taxing authorities— — — 
Unrecognized tax benefits, end of period$714 $— $— 
If the above tax benefits were recognized, the effective income tax rate would be reduced. GCMG recognized interest and penalties accrued related to unrecognized tax benefits as income tax expense. Related to the unrecognized tax benefits, GCMG has accrued interest of $0.3 million as of December 31, 2024. No interest and penalties were accrued as of December 31, 2023.
In December 2021, the Organization for Economic Co-operation and Development (“OECD”) introduced a new global minimum tax of 15% on multi-national entities with global revenues in excess of €750 million, several foreign jurisdictions being effective on January 1, 2024. As of December 31, 2024 and 2023, the Company’s global revenues were below the threshold, and as such, these rules currently do not have an impact on the Company’s Consolidated Financial Statements. The Company will continue to monitor the legislation for potential impacts.