LKQ · 10-Q · 2026Q3 · Full report

Income Tax Rate Changes

LKQ CORP · 2026-10-29 · Importance 59 · Surprise 82 · No source text

The effective tax rate for the third quarter of 2026 was 691.7%, compared with 20.0% in the prior-year quarter, largely because the $84 million nondeductible portion of Specialty’s goodwill impairment reduced pretax income without a corresponding tax benefit. The nine-month effective tax rate increased to 35.2% from 24.8%. The nondeductible impairment increased the nine-month rate by 6.7 percentage points, while changes in geographic income mix contributed a 1.3-point unfavorable impact.

Key facts

• LKQ's three-month 2026 effective income tax rate was 691.7%, compared with 20.0% in the prior-year quarter, primarily because $84 million of Specialty goodwill impairment was nondeductible. source
• LKQ's $84 million nondeductible Specialty goodwill impairment increased its nine-month 2026 effective tax rate by 6.7%. source
• LKQ's nine-month 2026 effective income tax rate was 35.2%, compared with 24.8% in 2025; geographic income distribution changes had a 1.3% unfavorable impact and discrete items increased the rate impact by 9.1%. source

Impact estimates