CMI · 8-K · 20260804PR000026

Income Tax Rate Changes

CUMMINS INC · 2026-08-04 · Importance 18 · Surprise 14

The second-quarter 2026 effective tax rate was 25.1%, compared with 24.2% in the second quarter of 2025. The quarter included $29 million of unfavorable discrete tax items, or $0.21 per diluted share, consisting primarily of $17 million of unfavorable return-to-provision adjustments and $12 million of other unfavorable items. The six-month effective tax rate was 26.0%, compared with 24.1% in the prior-year period. Cummins expects its full-year 2026 effective tax rate to approximate 23.0%, excluding future discrete items.

Key facts

• Cummins' effective tax rate for 2026 is expected to approximate 23.0 percent, excluding any discrete items that may arise source
• The six months ended June 30, 2026 had an unfavorable discrete tax impact due to the $199 million loss on sale of business and settlement for which no tax benefit was recognized source
• The tax rate in the second quarter was 25.1% including $29 million, or $0.21 per diluted share, of unfavorable discrete tax items source