Palantir paid $0 in U.S. federal income tax on $1.63 billion of net income
Palantir’s 2025 Form 10-K discloses income before tax by U.S. and foreign jurisdictions and provides a detailed effective tax rate reconciliation.
The filing does not include country-by-country cash income tax payments. Geographic visibility is limited to a U.S. versus foreign split, with the United Kingdom specifically referenced in the rate reconciliation.
Country-level tax picture
Palantir reports income before tax of $1.66 billion in 2025. Of that amount, $1.58 billion arose in the United States, and $72.8 million arose in foreign jurisdictions.
The current income tax provision totaled $26.6 million in 2025. That consisted of:
U.S. federal: $0
U.S. state: $1.5 million
Foreign: $25.1 million
Palantir does not disclose cash income taxes paid to individual countries. It does not name foreign jurisdictions beyond identifying the United Kingdom in the effective tax rate reconciliation.
Concentration and scale
Pre-tax income is heavily concentrated in the United States. In 2025, roughly 96% of income before tax was U.S. sourced. Foreign income represented about 4%.
The tax provision follows a different pattern. Federal current tax was zero. Foreign current tax of $25.1 million represented most of the current provision. State taxes added $1.5 million.
The effective tax rate for 2025 was 1.4%. That rate is well below the 21% U.S. statutory rate. The reconciliation shows large offsets from stock-based compensation and tax credits. Changes in valuation allowances also materially affected the calculation.
The filing does not break foreign tax into named countries for cash or provision purposes. The United Kingdom appears in the rate reconciliation as a statutory rate difference item. No other jurisdictions are quantified individually.
Year-over-year change
Income before tax increased from $489 million in 2024 to $1.66 billion in 2025. The total income tax provision rose modestly from $21.3 million to $22.7 million.
Because pre-tax income increased sharply while tax expense rose only slightly, the effective tax rate declined from 4.3% in 2024 to 1.4% in 2025. In 2023, the effective rate was 8.3%.
The geographic mix of income remained similar. The United States generated the vast majority of pre-tax income in each year. Foreign income was stable at about $60 to $73 million annually.
The company did not introduce a new country-level tax disclosure in 2025. Visibility remains at the U.S. versus foreign level.
What the numbers suggest
The structure is clear. Pre-tax income is concentrated in the United States. The current tax provision, however, is largely foreign and state. Federal current tax remains zero. The effective rate is driven by permanent differences, tax credits, and valuation allowance movements rather than statutory rates.
Geographic transparency is limited. The filing identifies the United Kingdom in the rate reconciliation but does not disclose cash tax payments by country. The reader can see the U.S. versus foreign split, but not how foreign taxes are distributed across jurisdictions.
For non-routine drivers, the filing identifies the enactment of the One Big Beautiful Bill Act on July 4, 2025. That law introduced immediate expensing of domestic research and experimental expenditures beginning in 2025. The company applied this change in the current year.
The filing also discusses the OECD Pillar Two framework. In some jurisdictions, Palantir became subject to certain Pillar Two rules starting January 1, 2024. The company states that Pillar Two did not have a material impact on its 2025 results.
The effective tax rate reconciliation shows no recorded effect from changes in tax laws or rates enacted in the current period. The primary year-over-year changes reflect income growth and recurring structural items rather than a single external tax shock.
Closing takeaway
Palantir’s 2025 tax profile is defined by U.S. income concentration and a low effective rate. The filing shows limited country detail, with most visibility confined to U.S. versus foreign totals.