What was the balance of the tax valuation allowance for Budget at the end of the period in 2024?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
ed average interest rate of 8.01%. These notes were issued under previously outstanding series of debt.
In February 2025, we borrowed $500 million under a floating rate term loan due December 2025, which is part of our senior revolving credit facilities.
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Schedule II – Valuation and Qualifying Accounts
| (in millions) Description | Balance of | at Beginning Period | Expe | nse (Benefit) | Other Adjustments (a) | _ | Deductions | Balance at End of Period |
|---|---|---|---|---|---|---|---|---|
| Allowance for Doubtful Accounts: Year Ended December 31, 2024 2023 2022 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the balance of the tax valuation allowance at the end of the period in 2024 was $85 million. This figure represents Budget's assessment of the portion of its deferred tax assets that may not be realized in the future.
The tax valuation allowance is a contra-asset account used to reduce the carrying value of deferred tax assets when it is more likely than not that some or all of the deferred tax assets will not be realized. This means that Budget does not expect to receive a tax benefit from these assets. The valuation allowance can fluctuate from year to year based on changes in Budget's profitability, tax laws, and other factors.
For a prospective Budget franchisee, this information provides insight into Budget's financial health and its expectations regarding future tax liabilities and assets. While the tax valuation allowance itself does not directly impact franchisees, it is an indicator of Budget's overall financial strategy and risk management related to taxes. Reviewing these figures over several years can reveal trends in Budget's tax planning and financial forecasting.