Maximus, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Sep. 30, 2024

Schedule of Components of Income Tax Expense (Benefit)


Table 11.1: Components of Provision for Income Taxes
	For the Year Ended September 30,
	2024		2023		2022
	(in thousands)
Current provision/(benefit):
Federal	$	82,875	$	34,033	$	45,042
State and local	26,951		12,332		15,371
Foreign	25,791		584		2,653
Total current provision for income taxes	135,617		46,949		63,066
Deferred tax expense/(benefit):
Federal	(16,347)		(1,495)		7,107
State and local	(5,447)		(673)		2,130
Foreign	(14,228)		3,720		967
Total deferred tax expense/(benefit)	(36,022)		1,552		10,204
Provision for income taxes	$	99,595	$	48,501	$	73,270

Schedule of Income before Income Tax, Domestic and Foreign


Table 11.2: Components of Income before Provision for Income Taxes by Country
	For the Year Ended September 30,
	2024		2023		2022
	(in thousands)
Domestic	$	377,594	$	198,115	$	274,641
Foreign	28,915		12,178		2,457
Income before provision for income taxes	$	406,509	$	210,293	$	277,098

Schedule of Effective Income Tax Rate Reconciliation


Table 11.3: Reconciliation of Tax Expense at Statutory Rate to Actual Tax Expense
	For the Year Ended September 30,
	2024			2023			2022
	(dollars in thousands)
Tax expense at statutory rate	$	85,367		$	44,162		$	58,190
Increase/(decrease) due to:
State income taxes, net of federal benefit	21,582			11,501			14,244
Foreign taxation rate differentials	875			(590)			(709)
Non-deductible expenses	2,444			2,889			882
Global intangible low taxed income	1,257			2,274			—
Valuation allowance - foreign jurisdictions	734			2,010			4,875
Tax credits	(8,997)			(6,645)			(5,239)

Excess tax expense/(benefits) from stock-based compensation	(1,656)			(1,399)			1,143
Other	(2,011)			(5,701)			(116)
Income tax expense	$	99,595		$	48,501		$	73,270

U.S. Federal Statutory tax rate	21.0		%	21.0		%	21.0		%
Effective tax rate	24.5		%	23.1		%	26.4		%

Schedule of Deferred Tax Assets and Liabilities


Table 11.4: Components of Deferred Tax Assets and Liabilities
	As of September 30,
	2024		2023
	(in thousands)
Deferred tax assets/(liabilities):
Costs deductible in future periods	$	42,856	$	37,036
Deferred revenue	10,459		8,712
Stock compensation	7,482		6,212
Capital loss carryforward	7,872		2,391
Net operating loss carryforwards	35,492		33,278
Amortization of goodwill and intangibles	(183,406)		(189,316)
Capitalized software	(23,661)		(28,246)
Accounts receivable - unbilled	(4,731)		(7,963)
Property and equipment	1,286		(3,437)
Prepaid expenses	(11,696)		(10,906)
Financial instruments	(2,413)		(8,158)
Valuation allowance	(31,956)		(34,643)
Other	(1,901)		(6,399)
Net deferred tax liability	$	(154,317)	$	(201,439)

Our deferred tax assets and liabilities are held in various national and international jurisdictions that do not allow right of offset. Accordingly, our presentation of deferred taxes on our consolidated balance sheets is split between jurisdictions that show a net deferred tax asset and a net deferred tax liability.


Table 11.5: Deferred Tax Assets and Liabilities By Jurisdiction Positions
	As of September 30,
	2024		2023
	(in thousands)
Total of tax jurisdictions with net deferred tax assets	$	14,801	$	2,459
Total of tax jurisdictions with net deferred tax liabilities	(169,118)		(203,898)
Net deferred tax liabilities	$	(154,317)	$	(201,439)

Schedule of Unrecognized Tax Benefits Roll Forward


Table 11.6: Reconciliation of the Beginning and Ending Amounts of Potential Tax Benefits
	For the Year Ended September 30,
	2024		2023		2022
	(in thousands)
Balance at beginning of year	$	6,233	$	8,676	$	12,642

Decreases for lapse of statute of limitations	—		(2,051)		(1,412)
Decreases for settlements with taxing authorities	—		(692)		(4,785)
Increases for tax positions taken in current year	7,248		300		2,231
Decreases for tax positions taken in current year	(2,589)		—		—
Balance at end of year	$	10,892	$	6,233	$	8,676