IBM · 10-Q · 2026Q3 · Full report

Income Tax Rate Changes

INTERNATIONAL BUSINESS MACHINES CORP · 2026-10-22 · Importance 59 · Surprise 82

IBM’s continuing-operations tax provision was $298 million in the third quarter of 2026 and $782 million for the first nine months, compared with $686 million and $1.193 billion, respectively, in the prior-year periods. The year-over-year reduction primarily reflected the one-time, non-cash tax charge recorded in the third quarter of 2025 following enactment of U.S. H.R. 1. IBM said its tax provision and effective tax rate remain sensitive to geographic income mix, incentives, transactions, unrecognized tax benefits, audit settlements and changes in tax laws or regulations. Future adjustments to U.S. tax-reform charges could result from changes in law, regulations, guidance or audit adjustments.

Key facts

• The continuing operations provision for income taxes for the first nine months of 2026 was $782 million, compared to $1,193 million for the first nine months of 2025. source
• Provision for income taxes from continuing operations was $0.3 billion in the third quarter of 2026 compared to $0.7 billion in the third quarter of 2025. source
• The continuing operations provision for income taxes was $298 million in the third quarter of 2026, compared to $686 million in the third quarter of 2025. source
• Operating (non-GAAP) provision for income taxes was $483 million in the third quarter of 2026, compared to $516 million in the third quarter of 2025. source
• Operating (non-GAAP) provision for income taxes in the first nine months of 2026 was $1,290 million, compared to $1,282 million in the first nine months of 2025. source