What were the deductions for the tax valuation allowance for Budget in 2023?
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 Doubtfu |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the tax valuation allowance deductions for the year ended December 31, 2023, were $0.
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 portion or all of the deferred tax assets will not be realized. In simpler terms, it's an estimate of how much of the company's future tax benefits might not actually materialize. The changes in this allowance from year to year can reflect a company's changing expectations about its future profitability and tax situation.
For a prospective Budget franchisee, understanding these figures is crucial because they reflect the financial health and tax strategies of the parent company. While a franchisee might not directly deal with these specific tax valuations, they provide insight into the overall financial management and stability of Budget, which can indirectly affect the support, resources, and brand strength available to the franchisee.