ARKO Corp. Annual report [Section 13 and 15(d), not S-K Item 405]

Annual report [Section 13 and 15(d), not S-K Item 405]

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2025

The deferred tax assets expire as follows:


	Amount		Expiration Date
	(in thousands)
Domestic federal NOL	$	2,866	Indefinite life
Domestic state NOL		11,007	2032 - Indefinite
Domestic tax credits		1,520	2045
Foreign NOL		14,715	Indefinite life
Foreign capital loss		6,257	Indefinite life
Foreign tax credits		591	2025 - 2026

Summary of Reconciliation of Uncertain Tax Positions

A reconciliation of the beginning and ending balances of uncertain tax positions included in other current liabilities on the consolidated balance sheets was as follows:


	2025		2024		2023
	(in thousands)
Beginning balance as of January 1,	$	261	$	261	$	261
Additions for tax positions taken in prior years		—		—		—
Reductions of tax positions taken in prior years		—		—		—
Reductions for settlements on tax positions of prior years		—		—		—
Ending balance as of December 31,	$	261	$	261	$	261

Summary of Earnings Before Income Inclusive of the Loss from Equity Investee

Earnings before income taxes were as follows:


	For the Year Ended December 31,
	2025		2024			2023
	(in thousands)
Domestic (U.S.)	$	21,546	$	27,257		$	46,038
Foreign (Israel)		7,540		(268	)		694
Total	$	29,086	$	26,989		$	46,732

Summary of Income Tax Provision

The components of the income tax provision were as follows:


	For the Year Ended December 31,
	2025			2024			2023
	(in thousands)
Current:
Domestic federal	$	(29	)	$	13,860		$	10,501
Domestic state and local		1,307			5,080			6,345
Total current		1,278			18,940			16,846
Deferred:
Domestic federal		4,578			(10,330	)		(3,316	)
Domestic state and local		486			(2,466	)		(1,364	)
Total deferred		5,064			(12,796	)		(4,680	)
Total income tax expense	$	6,342		$	6,144		$	12,166

Summary of Reconciliation of Significant Differences in Income Tax Expense

The reconciliation of significant differences between income tax expense applying the US statutory rate and the actual income tax expense at the effective rate were as follows:


	For the Year Ended December 31,
	2025					2024					2023
	(in thousands)
Income tax expense at the statutory rate	$	6,108		21.0	%	$	5,668		21.0	%	$	9,814		21.0	%
Increases (decreases):
State income taxes, net of federal income tax benefit (a)		1,520		5.2	%		1,547		5.7	%		3,958		8.5	%
Non-deductible expenses (non-includable income)
Fair value adjustments, primarily warrants		(1,687	)	(5.8	)%		(2,381	)	(8.8	)%		(2,468	)	(5.3	)%
Acquisition settlement		—		0.0	%		(563	)	(2.1	)%		—		0.0	%
Section 162(m) limitation		1,937		6.7	%		1,188		4.4	%		1,508		3.2	%
Other		55		0.2	%		87		0.3	%		103		0.2	%
Change in valuation allowance		(23	)	(0.1	)%		(31	)	(0.1	)%		8		0.0	%
Tax credits
Work Opportunity Credit		(727	)	(2.5	)%		(659	)	(2.4	)%		(1,024	)	(2.2	)%
Section 30C Alternative Fuel Vehicle Refueling Property Credit		(600	)	(2.1	)%		—		0.0	%		—		0.0	%
Foreign tax effects — Israel
Change in valuation allowance		(343	)	(1.2	)%		(1,287	)	(4.7	)%		(2,401	)	(5.1	)%
Expired attributes		1,154		4.0	%		1,221		4.5	%		2,319		5.0	%
Foreign currency translation adjustments		(965	)	(3.3	)%		62		0.2	%		112		0.2	%
Other		154		0.5	%		1		0.0	%		(30	)	(0.1	)%
Other
Internal entity realignment, change in entity status (b)		—		0.0	%		1,500		5.6	%		—		0.0	%
Other		(241	)	(0.8	)%		(209	)	(0.8	)%		267		0.6	%
Total	$	6,342		21.8	%	$	6,144		22.8	%	$	12,166		26.0	%

(a)

The states that contributed to the majority (greater than 50%) of the tax effect in this category include Tennessee and Texas for 2025 and 2024, and Texas, Virginia, Tennessee and Michigan for 2023.

Refer to details above.

Schedule of Income Tax Paid

The amounts of cash taxes paid by the Company were as follows:


	For the Year Ended December 31,
	2025		2024		2023
	(in thousands)
Federal	$	3,102	$	6,246	$	20,709
State:
Texas		759		684		—
Virginia		383		—		—
Tennessee		—		—		1,537
All other states		797		2,729		6,374
Total state		1,939		3,413		7,911
Foreign		—		—		—
Income taxes paid, net of refunds received	$	5,041	$	9,659	$	28,620

Summary of Significant Components of Deferred Income Tax Assets and Liabilities

Significant components of deferred income tax assets and liabilities consisted of the following:


	As of December 31,
	2025			2024
	(in thousands)
Deferred tax assets:
Asset retirement obligation	$	22,473		$	22,027
Inventory		244			309
Lease obligations		414,897			424,229
Financial liabilities		31,609			43,099
Accrued expenses		5,272			5,438
Deferred income		16,254			13,576
Fuel supply agreements		76,188			82,728
Environmental liabilities		979			1,205
Transaction costs		1,839			1,880
Share-based compensation		4,551			3,957
Net operating loss carryforwards		5,802			4,621
Credits		2,112			1,655
Interest limitation carryforward		3,904			7,972
Other		2,192			3,017
Total deferred tax assets		588,316			615,713
Valuation allowance		(6,835	)		(7,205	)
Total deferred tax assets, net		581,481			608,508
Deferred tax liabilities:
Property and equipment		(124,652	)		(131,135	)
Intangible assets		(17,269	)		(18,483	)
Right-of-use assets		(371,294	)		(385,542	)
Prepaid expenses		(5,589	)		(5,596	)
Other		(52	)		(63	)
Total deferred tax liabilities		(518,856	)		(540,819	)
Net deferred tax asset	$	62,625		$	67,689