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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2024

Income Tax Disclosure [Abstract]

Schedule of Income Before Taxes

The components of income (loss) before income taxes were as follows:

			Years Ended December 31,
			2024						2023						2022
Domestic			$	29.2					$	(68.3)					$	14.0
Foreign			10.0						10.2						10.9
			$	39.3					$	(58.1)					$	24.9

Schedule of Components of Income Tax Expense (Benefit)

The components of income tax expense (benefit) were as follows:

			Years Ended December 31,
			2024						2023						2022
Current:
Federal			$	3.0					$	2.1					$	0.2
State			0.8						0.3						(0.8)
Foreign			2.8						3.6						(0.2)
			6.6						6.0						(0.8)
Deferred:
Federal			7.0						(14.6)						4.7
State			1.9						(2.6)						(0.7)
Foreign			(0.3)						(0.5)						0.6
Provision for (reversal of) valuation allowance on deferred tax assets			(8.8)						17.3						(3.9)
			(0.2)						(0.4)						0.7
Other			(1.1)						—						(0.7)
Total			$	5.3					$	5.6					$	(0.8)

Schedule of Effective Income Tax Reconciliation

The following table presents a reconciliation of the Income tax provision at the U.S. federal statutory tax rate to our Income tax provision at our actual effective income tax rate:

			Years Ended December 31,
			2024									2023									2022
			$			%						$			%						$			%
Expected income tax expense (benefit) at statutory rate			$	8.2		21		%				$	(12.2)		21		%				$	5.2		21		%
Differences between expected and actual income tax expense:
CARES Act			0.3			1						—			—						—			—
Provision for (reversal of) valuation allowance on deferred tax assets			(8.8)			(23)						17.3			(30)						(3.9)			(16)
Provision for (reversal of) liability for uncertain tax positions			1.0			3						1.1			(2)						(3.4)			(14)
Interest on refund claims due from tax authorities			(1.4)			(4)						—			—						(0.7)			(3)
Other provision to return differences			0.8			2						(0.1)			—						(0.2)			(1)
Foreign tax differential including effectively connected income and foreign withholding taxes (1)			0.8			2						1.2			(2)						2.3			9
State tax, after Federal tax benefit			2.2			6						(1.8)			3						(0.3)			(1)
Benefit of state net operating loss (NOL) carryback claims and amended return filings			—			—						—			—						(1.2)			(5)
Executive compensation disallowance			1.7			4						1.6			(3)						1.6			6
Excess tax benefits from share-based compensation			0.2			—						(1.9)			3						(0.4)			(2)
Other permanent differences			0.4			1						—			—						0.1			—
Foreign tax credit (generation) utilization			—			—						0.1			—						0.1			—
U.S. Tax Reform - Global Intangible Low-Taxed Income (GILTI) inclusion			—			—						—			—						0.1			—
Other			0.1			—						0.3			—						(0.1)			—
Actual income tax expense (benefit)			$	5.3		14		%				$	5.6		(10)		%				$	(0.8)		(3)		%

(1)Onity is a global company with operations in the U.S., USVI, India and the Philippines, among other jurisdictions. In the effective tax rate reconciliation above, we first calculate income tax expense attributable to worldwide continuing operations at the U.S. statutory tax rate. The foreign tax rate differential therefore represents the difference in tax expense between jurisdictional income taxed at the U.S. statutory rate and each respective jurisdictional statutory rate.

Schedule of Deferred Tax Assets and Liabilities

Net deferred tax assets were comprised of the following:

			December 31,
			2024						2023
Deferred tax assets
NOL carryforwards - federal and foreign			$	55.3					$	106.8
NOL carryforwards and credits - state and local			75.5						82.0
Interest expense disallowance			170.2						123.0
Reserve for servicing exposure			6.0						5.8
Accrued legal settlements			3.5						4.8
Stock-based compensation expense			11.3						11.4
Accrued incentive compensation			6.9						4.5
Accrued other liabilities			4.4						4.4
Lease liabilities			0.4						0.9
Intangible asset amortization			7.2						7.2
Foreign deferred assets			3.7						3.4
Tax residuals and deferred income on tax residuals			0.2						1.4
Bad debt and allowance for loan losses			10.4						11.0
Other			1.6						1.7
			356.6						368.3
Deferred tax liabilities
MSR amortization			170.9						175.0
Partnership losses			—						3.9
Other			1.5						1.2
			172.4						180.1
Net deferred tax assets (liabilities) before valuation allowance			184.2						188.2
Valuation allowance			(181.0)						(185.1)
Deferred tax assets, net			$	3.2					$	3.1

Schedule of Unrecognized Tax Benefits Roll Forward

The following table presents the activity related to unrecognized tax benefits for uncertain tax positions (excluding accrued interest and penalties):

			Years Ended December 31,
			2024						2023						2022
Beginning balance			$	8.7					$	8.7					$	11.5
Additions for tax positions of current year			—						—						—
Reductions for settlements			—						—						(2.1)
Lapses in statute of limitations			—						—						(0.7)
Ending balance (1)			$	8.7					$	8.7					$	8.7

(1)Included in the Liability for uncertain tax positions in Other liabilities.

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