TROW · 10-Q · 2026Q3 · Full report

Income Tax Rate Changes

PRICE T ROWE GROUP INC · 2026-10-29 · Importance 18 · Surprise 14

The GAAP effective tax rate was 24.2% in Q3 2026, compared with 22.1% in Q3 2025; the year-to-date rate increased to 23.7% from 22.8%. The nine-month GAAP tax-rate increase primarily reflected income attributable to redeemable non-controlling interests in consolidated investment products, which is included in pretax income but is not taxable to the firm. The adjusted effective tax rate rose to 24.0% from 23.8%, primarily because of higher valuation allowances in 2026. The company estimated a full-year 2026 GAAP and adjusted effective tax rate of 23.5% to 25.5%.

Key facts

• The firm expects future effective tax-rate volatility from stock-price effects on stock-based compensation tax benefits, changes in earnings mix among countries with differing tax laws or rates, and changes in foreign deferred-tax-asset valuation allowances. source
• The GAAP effective income tax rate was 24.2% in Q3 2026, compared with 22.1% in Q3 2025. source
• The effective income tax rate for the nine months ended September 30, 2026 was 23.7%, compared with 22.8% in 2025; the adjusted effective rate was 24.0% versus 23.8%. source