LOUISIANA-PACIFIC CORP

6. INCOME TAXES

Income Tax Provision

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

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

Deferred Taxes

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

The benefit relating to capital loss, operating loss, and credit carryforwards included in the above table at December 31, 2025, consisted of (dollar amounts 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, 2025, and 2024, the deferred tax liability related to unremitted foreign earnings was $25 million and $19 million, respectively.

In 2021, the Organization for Economic Cooperation and Development (OECD) announced an Inclusive Framework on Base Erosion and Profit Shifting, including the Pillar Two Model Rules (Pillar Two), applicable to large multinational corporations. These rules establish a global per-country minimum tax of 15%. Although, the United States has not enacted legislation to adopt the Pillar Two framework, and future adoption remains uncertain, certain countries where our operations are conducted have enacted such legislation.

Specifically, the Canadian and Brazilian governments enacted legislation in 2024 implementing certain aspects of the OECD’s minimum tax rules under the Pillar Two Framework. To date, no other jurisdictions in which LP operates have enacted Pillar Two legislation. At this time, Pillar Two legislation is not expected to have a material impact on the Company’s effective tax rate, consolidated results of operations, financial position, or cash flows. The Company will continue to monitor future developments related to Pillar Two legislation to assess any potential impact in the relevant jurisdictions.

On July 4, 2025, H.R. 1, a bill to provide for reconciliation pursuant to title II of H. Con. Res. 14, informally known as the One Big Beautiful Bill Act (“The Tax Act”), was enacted in the U.S., introducing a series of corporate tax changes in the U.S., including significant provisions such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented thereafter through 2027. The provisions of The Tax Act effective in 2025 include 100% bonus depreciation on qualified property and full expensing for research and experimental expenditures. The impacts of The Tax Act are reflected in our results for the year ended December 31, 2025, and have no material impact on our income tax expense or effective tax rate. Certain provisions of The Tax Act decreased cash taxes paid during the year and may change the timing of cash tax payments in future periods.

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

As further described in “Note 2 - Present and Prospective Accounting Pronouncements,” the Company has elected to prospectively adopt the guidance in ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Taxes Disclosures. The following table is a reconciliation of the U.S. federal statutory tax rate to the total effective tax rates from continuing operations for the year ended December 31, 2025 in accordance with the guidance in ASU 2023-09 (dollar amounts in millions):

1 State taxes in Arizona, California, Georgia, Indiana, Maine, Minnesota, North Carolina, and Pennsylvania made up the majority (greater than 50%) of the tax effect in this category.

The following table is a reconciliation of the U.S. federal statutory tax rate to the total effective tax rates from continuing operations for the years ended December 31, 2024 and 2023 in accordance with the guidance prior to the adoption of ASU 2023-09 (dollar amounts 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 2020 and subsequent. Our tax returns are currently under examination by tax authorities in the U.S. for years 2022 and 2023, Canada for year 2022, and in Chile for years 2016 and 2020.

Income Tax Payments

The following table is a summary of income taxes paid (net of refunds) by jurisdiction pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025 (dollar amounts in millions):

We paid income taxes, net of refunds, of $42 million, $124 million, and $65 million during 2025, 2024, and 2023, respectively. Included in our Consolidated Balance Sheet at December 31, 2025 is a net income tax receivable of $11 million, compared to $1 million at December 31, 2024.

Uncertain Tax Positions

The following is a tabular reconciliation of the total amount of unrecognized tax benefits at the beginning and end of the years (dollar amounts in millions):

Included within other long-term liabilities on our Consolidated Balance Sheets at December 31, 2025, are $4 million of tax benefits that, if recognized, would affect our effective tax rate. We accrued and paidno interest during 2025 or 2024.