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Income taxes | 12 Months Ended
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Dec. 31, 2025
Income Tax Disclosure [Abstract] |
Income taxes | Note 18. Income taxes Current tax is the amount of income tax recoverable (payable) in respect of the taxable loss (profit) for a period. Deferred tax is recognized on temporary differences between the carrying amounts of assets and liabilities for accounting and tax purposes. Deferred income tax assets and liabilities are measured at the tax rates expected to apply when temporary differences reverse. Current and deferred taxes are offset only when they are levied by the same tax authority, on the same entity or group of entities, and when there is a legal right to offset. Income earned through the Company's foreign subsidiaries is generally taxed in the foreign country in which they operate. Prior to the Domestication (as defined below) of Legacy Mount Logan to the United States (US), Legacy Mount Logan was subject to income taxes in Canada, which included taxes on the income earned through Legacy Mount Logan's controlled US subsidiaries, but a deduction was allowed for certain US taxes paid on such income. The effective income tax rate reflected in the Consolidated Statements of Operations varies from the United States and Canadian tax rates of 21.0 percent and 26.5 percent for the year ended December 31, 2025 (December 31, 2024 – 21.0 percent and 26.5 percent) for the items outlined in the following table.
|  |  |  | Years Ended December 31,
|  |  |  |  |  | 2025 |  | 2025 |  | 2024 |  | 2024
Income (loss) before taxes |  |  |  |  |  | $ | (58,461) |  |  |  |  | $ | (9,781) |  |  |
Income tax rate ¹ |  |  |  |  |  | 21.0% |  |  |  | 26.5% |  |
Income tax expense at statutory tax rate |  |  |  |  |  | (12,277) |  | 21.0% |  | (2,592) |  |  | 26.5%
State and local income taxes, net of federal (national) income tax effect 2 |  |  |  |  |  | 460 |  |  | (0.8) | % |  | — |  |  | —%
Foreign tax effects (Canada): |  |  |  |  |  |  |  |  |  |  |  | —%
Statutory tax rate difference between Canada and the US |  |  |  |  |  | (704) |  |  | 1.2 | % |  | (104) |  |  | 1.1%
Nondeductible Differences |  |  |  |  |  | 1,395 |  |  | (2.4) | % |  | 1,368 |  |  | (14.0)%
Domestication capital gain 1 |  |  |  |  |  | 3,598 |  |  | (6.2) | % |  | — |  |  | —%
Partnership differences |  |  |  |  |  | 1,205 |  |  | (2.1) | % |  | — |  |  | —%
Foreign accrual property income impact |  |  |  |  |  | 786 |  |  | (1.4) | % |  | 2,947 |  |  | (30.1)%
Net Operating Loss 3 |  |  |  |  |  | (3,003) |  |  | 5.1 | % |  | — |  |  | —%
Change in valuation allowances 4 |  |  |  |  |  | 13,329 |  |  | (22.8) | % |  | (1,375) |  |  | 14.1%
Dividends Received Deduction |  |  |  |  |  | (135) |  |  | 0.2 | % |  | — |  |  | —%
Deferred True Up |  |  |  |  |  | (2,059) |  |  | 3.5 | % |  | — |  |  | —%
Other |  |  |  |  |  | (209) |  |  | 0.4 | % |  | 362 |  |  | (3.8)%
Income tax expense (benefit) |  |  |  |  |  | $ | 2,386 |  |  | (4.1) | % |  | $ | 606 |  |  | (6.2)%
_______________ (1)On September 12, 2025, pursuant to a Plan of Domestication, immediately prior to the Mergers, (i) Legacy Mount Logan domesticated from the Province of Ontario, Canada to the State of Delaware, (ii) immediately following step (i), Mount Logan converted to a limited liability company, and (iii) immediately following (ii), Mount Logan made an election to be treated as a corporation for U.S. federal income tax purposes (the “Domestication”). As a result of the Domestication and the completion of the Business Combination, the Company is subject to a statutory tax rate of 21% in the U.S. as compared to the 26.5% statutory Canadian corporate income tax rate applicable to Legacy Mount Logan prior to the Domestication. (2)State taxes in Texas, California, Massachusetts, Minnesota, Georgia, New Jersey, Utah, New York and New York City make up the majority of the tax effect in this category. (3)As a result of the Domestication, the NOL generated in Canada is not expected to provide a future tax benefit as the Company does not anticipate future taxable income or tax due in Canada. (4)A valuation allowance has been recorded to offset certain deferred tax assets, net of amounts expected to be realized through reversal of existing deferred tax liabilities. Management concluded that, after considering reversing deferred tax liabilities, tax-planning opportunities and forecasted taxable income, the weight of evidence — including cumulative losses and Section 382 limitations on acquired loss carryforwards — indicates the remaining deferred tax assets are not more-likely-than-not to be realized. The primary drivers of the change in deferred tax assets are (i) recognition of loss and capital-loss carryforwards acquired from TURN, which are materially restricted by a Section 382 limitation, and (ii) the recognition in the current year of a taxable loss in the Asset Management segment that generated a net operating loss (and continued NOL positions in the Insurance Solutions segment), for which projected taxable income — given cumulative pre-tax losses over the prior three years — is insufficient to support utilization. Income taxes paid The Company’s cash paid for taxes included in the consolidated statements of cash flows consists of the following:
|  | Years Ended December 31,
|  | 2025 |  | 2024
US Federal |  | $ | 94 |  |  | $ | 500 |
NY State |  | 9 |  |  | 84 |
NY City |  | 10 |  |  | 82 |
Texas |  | 35 |  |  | — |
Massachusetts |  | 35 |  |  | 81 |
Minnesota |  | 15 |  |  | 28 |
Georgia |  | 18 |  |  | — |
Other States |  | 54 |  |  | 53 |
Foreign |  | 37 |  |  | — |
Income taxes paid |  | $ | 307 |  |  | $ | 828 |
For the year ended December 31, 2025, the Company received $0.3 million in tax refunds (December 31, 2024 - $0.1 million). Components of income tax provision The details of income (loss) before income taxes by jurisdiction are as follows:
|  |  |  | Years Ended December 31,
|  |  |  |  |  | 2025 |  | 2024
United States |  |  |  |  |  | $ | (43,028) |  |  | $ | (603) |
Foreign |  |  |  |  |  | (15,433) |  |  | (9,178) |
Income (loss) before taxes |  |  |  |  |  | $ | (58,461) |  |  | $ | (9,781) |
The details of the income tax provision by jurisdiction are as follows:
|  |  |  | Years Ended December 31,
|  |  |  |  |  | 2025 |  | 2024
Current tax |  |  |  |  |  |  |  |
Federal |  |  |  |  |  | $ | (15) |  |  | $ | 1,547 |
State |  |  |  |  |  | 68 |  |  | — |
Foreign |  |  |  |  |  | 37 |  |  | — |
Total current tax |  |  |  |  |  | $ | 90 |  |  | $ | 1,547 |
Deferred tax |  |  |  |  |  |  |  |
Federal |  |  |  |  |  | $ | 1,905 |  |  | $ | (941) |
State |  |  |  |  |  | 391 |  |  | — |
Foreign |  |  |  |  |  | — |  |  | — |
Total deferred tax |  |  |  |  |  | $ | 2,296 |  |  | $ | (941) |
Income tax expense (benefit) |  |  |  |  |  | $ | 2,386 |  |  | $ | 606 |
Deferred tax assets and liabilities consists of the following temporary differences:
|  | December 31, 2025 |  | December 31, 2024
Assets |  |  |  |
Tax benefit of loss carryforward |  | $ | 45,098 |  |  | $ | 20,275 |
Tax benefit of expenditure pools |  | — |  |  | 13,415 |
Deferred acquisition costs |  | 6,198 |  |  | 6,009 |
Unrealized losses on remeasurement of investments |  | 17,628 |  |  | 10,478 |
Other assets tax value in excess of book value |  | 3,768 |  |  | 10,284 |
Total deferred tax assets |  | 72,692 |  |  | 60,461 |
Valuation allowance |  | (65,397) |  |  | (44,604) |
Total deferred tax assets, net of valuation allowance |  | $ | 7,295 |  |  | $ | 15,857 |
Liabilities |  |  |  |
Insurance reserves |  | $ | (2,686) |  |  | $ | (12,172) |
Other |  | (4,609) |  |  | (1,389) |
Total deferred tax liabilities |  | $ | (7,295) |  |  | $ | (13,561) |
Net deferred tax assets |  | $ | — |  |  | $ | 2,296 |
The Company considers its significant tax jurisdictions to include the United States and before the acquisition of TURN, Canada. The Company remains subject to income tax examination in Canada for years after 2021, and U.S. federal jurisdiction for years after 2022. On August 16, 2022, the U.S. enacted the Inflation Reduction Act of 2022 (“IRA”) which is generally effective for years beginning after December 31, 2022. Notably, the bill created a 15% corporate alternative minimum tax (“CAMT”) on corporations with three-year average financial statement income over $1 billion. The Internal Revenue Service has issued proposed regulations and multiple interim notices addressing CAMT computations, status determinations, and administrative relief; final regulations are pending. The Company has made certain interpretations and assumptions to comply with CAMT. The Company’s financial statement income is below $1 billion, therefore it is not expected that the Company would have a CAMT liability. If CAMT is paid in the future, the amount would be indefinitely available as a credit carryforward that would reduce tax in future years and would be treated as a temporary item reflected within deferred taxes. The Company has no uncertain tax positions. As of December 31, 2025, the Company’s U.S. income tax returns for tax years 2022 through 2025 generally remain subject to examination by the applicable taxing authorities, although tax year 2021 may remain open in certain U.S. state jurisdictions. In Canada, tax years 2021 through 2025 generally remain open to examination. The Company has reviewed and made an assessment of the potential exposure to Pillar Two income taxes. The review was generally based on the most recent information available from tax filings, country-by-country reporting and financial statements, and takes into account known changes in the group and its operations. Based on the review and assessment the Company has concluded that they do not have any potential exposure to Pillar Two income taxes. On July 4, 2025, the One Big Beautiful Bill Act ('OBBBA') was enacted. The Company has evaluated its provisions and concluded there is no material impact on the consolidated financial statements or effective tax rate for the year ended December 31, 2025. Furthermore, no material impact is expected on future results of operations, financial condition, or cash flows. The Company will continue to monitor any guidance or regulations issued by the Treasury Department.

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