TRGP · 10-Q · 2026Q3 · Full report

Income Tax Rate Changes

Targa Resources Corp. · 2026-11-05 · Importance 39 · Surprise 38 · Matches filing data

Nine-month income tax expense increased $135.2 million, or 35%, to $525.8 million in 2026 from $390.6 million in 2025, primarily because pre-tax book income increased. Third-quarter income tax expense rose $40.4 million to $174.7 million, also primarily reflecting higher pre-tax book income, partly offset by increased excess tax-deductible stock compensation. The effective tax rate was approximately 27% for the nine months ended September 30, 2026, compared with approximately 28% in the prior-year period, based on reported tax expense and pre-tax income.

Key facts

• For the nine months ended September 30, 2026, Targa's income tax expense was $525.8 million, compared with $390.6 million for the prior-year period. source
• Targa’s three-month income tax expense was $174.7 million in 2026, compared with $134.3 million in 2025; nine-month income tax expense was $525.8 million, compared with $390.6 million. source
• Targa does not expect the IRS audits to result in adjustments that would materially change its taxable income. source
• As of September 30, 2026, IRS examinations were in process for the 2022 and 2024 taxable years of certain Targa subsidiaries treated as partnerships for U.S. federal income tax purposes. source
• The statute of limitations expired on substantially all 2021 state income tax returns filed before October 15, 2022. source
• For Texas, the statute of limitations expired for report year 2022 returns. source

Impact estimates