GNRC · 10-Q · 2026Q3 · Full report

U.S. Tax Law Changes

GENERAC HOLDINGS INC. · 2026-11-03 · Importance 46 · Surprise 42 · In source text

The OBBBA, signed into law in the United States on July 4, 2025, made permanent provisions including 100% bonus depreciation and immediate expensing of domestic research and development costs. Generac continues to expect significant cash tax savings from these provisions, although the changes did not materially affect its effective tax rate for the nine months ended September 30, 2026 or its estimated annual effective tax rate for 2026. In January 2026, OECD administrative guidance deemed the U.S. tax system compliant with Pillar Two, which the company expects to eliminate additional top-up taxes across its global operations, while local Qualified Domestic Minimum Top-Up Taxes may still apply. The company reported no quarterly financial impact from the guidance and does not expect the rules to materially affect its effective tax rate for the year.

Key facts

• The July 4, 2025 OBBBA made 100% bonus depreciation and immediate expensing of domestic research and development costs permanent; Generac expects significant cash tax savings from these provisions. source

Impact estimates