NISOURCE INC.

12. Income Taxes

Our interim effective tax rates reflect the estimated annual effective tax rates for 2026 and 2025 applied to year-to-date pretax income, adjusted for tax expense associated with certain discrete items. The effective tax rates for the three months ended September 30, 2026 and 2025 were 8.6% and 16.1%, respectively. The effective tax rates for the nine months ended September 30, 2026 and 2025 were 13.0% and 17.0%, respectively. These effective tax rates differ from the federal statutory tax rate of 21% primarily due to net income attributable to noncontrolling interest, amortization of excess deferred income taxes, federal investment and production tax credits net of deferred regulatory liabilities, and other permanent book-to-tax differences.

The decrease in the three month effective tax rate of 7.5% in 2026 compared to 2025 is primarily driven by higher federal investment and production tax credits pass back partially offset by lower non-controlling interest.

The decrease in the nine month effective tax rate of 4.0% in 2026 compared to 2025 is primarily driven by higher federal investment and production tax credits pass back and amortization of excess deferred income taxes realized during 2026.

As of September 30, 2026, there have been no material changes to our unrecognized tax benefits or possible changes that could reasonably be expected to occur during the next twelve months. See Note 15 to the Company’s Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2025, for a discussion of these unrecognized tax benefits.