LOUISIANA-PACIFIC CORP

8. INCOME TAXES

Income Tax Provision

The components of income from continuing operations before income taxes, including equity in unconsolidated affiliates, were (dollars in millions):

The components of our income tax provision (benefit) from continuing operations were (dollars in millions):

We paid income taxes, net of refunds, of $124 million, $65 million, and $320 million during 2024, 2023, and 2022, respectively. Included in our Consolidated Balance Sheet at December 31, 2024 is a net income tax receivable of $1 million, compared to a net income tax receivable of $22 million at December 31, 2023.

Deferred Taxes

The tax effects of significant temporary differences creating deferred tax assets and liabilities were (dollars in millions):

The benefit relating to capital loss, operating loss, and credit carryforwards included in the above table at December 31, 2024, consisted of (dollars in millions):

We periodically review the need for valuation allowances against deferred tax assets and recognize these deferred tax assets to the extent that their realization is more likely than not. As part of our review, we consider all positive and negative evidence, including earnings history, the future reversal of deferred tax liabilities, and the relevant expirations of carryforwards. We believe that the valuation allowances provided are appropriate. If future years’ earnings differ from the estimates used to establish these valuation allowances, or other objective positive or negative evidence arises, we may record an adjustment to the valuation allowance resulting in an impact on tax provision (benefit) for that period.

In 2023 we made the determination that a substantial portion of unremitted foreign earnings was no longer indefinitely reinvested and as of December 31, 2023, we recorded a deferred tax liability of $21 million related to the taxes expected to be imposed upon the repatriation of such foreign earnings to the United States. As of December 31, 2024, the deferred tax liability related to unremitted foreign earnings was $19 million.

Over the last several years, the Organization for Economic Cooperation and Development (OECD) has developed an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two model rules applicable to large multinational corporations which would establish a global per-country minimum tax of 15%. While the United States has not enacted legislation to adopt Pillar Two and it is uncertain if it will do so in the future, certain countries in which we operate have enacted such legislation. Specifically, the Canadian government enacted legislation in 2024 implementing aspects of the OECD’s minimum tax rules effective in the 2024 fiscal year and released draft legislation proposed to implement further aspects effective for the 2025 fiscal year. In addition, in 2024, the Brazilian National Congress approved legislation implementing a tax measure to take effect in the 2025 fiscal year that is largely aligned with certain aspects of the OECD’s minimum tax rules under the Pillar Two framework. No other jurisdictions in which LP operates have enacted Pillar Two legislation at this time. At this time, we do not expect Pillar Two legislation to have a material impact on our effective tax rate or our consolidated results of operations, financial position or cash flows. The Company will continue to monitor future developments to determine any potential impact in the countries in which we operate.

Reconciliation of the U.S. Federal Statutory Rate to the Effective Rate

Reconciliation of the U.S. federal statutory tax rate to the total effective tax rates from continuing operations (dollars in millions):

We are subject to U.S. federal income tax as well as income taxes of multiple state jurisdictions. Our foreign subsidiaries are subject to income tax in Canada, Chile, Brazil, Peru, Colombia, Argentina, Paraguay, and Mexico.

We generally remain subject to U.S. federal and state examinations for tax years 2018 and subsequent. In addition to the U.S., we have tax years that remain open and subject to examination by tax authorities in the following major tax jurisdictions: Brazil and Chile for tax years 2017 and subsequent; and Canada for tax years 2019 and subsequent. Our tax returns are currently under examination by tax authorities in the U.S. for years 2018, 2019, and 2020, and in Chile for years 2016 and 2020.

Uncertain Tax Positions

Tabular reconciliation of the total amount of unrecognized tax benefits at the beginning and end of the years (dollars in millions):

Included within other long-term liabilities on our Consolidated Balance Sheets at December 31, 2024, are $11 million of tax benefits that, if recognized, would affect our effective tax rate. We accrued and paidno interest during 2024. We accrued interest of $2 million and paidno interest during 2023.