Voya Retirement Insurance and Annuity Co.

03/06/2026 | Press release | Distributed by Public on 03/06/2026 10:38

Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

Management's Narrative Analysis of the Results of Operations and Financial Condition
For the purposes of this discussion, the terms "VRIAC," "the Company," "we," "our," and "us" refer to Voya Retirement Insurance and Annuity Company and its subsidiaries. We are a direct, wholly owned subsidiary of Voya Holdings Inc., which is a direct, wholly owned subsidiary of Voya Financial, Inc. ("Voya Financial" or "Parent").
The following discussion and analysis presents a review of our results of operations for the years ended December 31, 2025 and 2024, and financial condition as of December 31, 2025 and 2024. This item should be read in its entirety and in conjunction with the Consolidated Financial Statements and related notes contained in Part II, Item 8. of this Annual Report on Form 10-K. For discussion and analysis of our results of operations for the years ended December 31, 2024 and 2023, refer to our 2024 Annual Report on Form 10-K filed with the SEC on March 11, 2025.
In addition to historical data, this discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Actual results may differ materially from those discussed in the forward-looking statements as a result of various factors. See the Note Concerning Forward-Looking Statements.
Overview
VRIAC is a stock life insurance company domiciled in the State of Connecticut. VRIAC and its wholly owned subsidiaries (collectively, the "Company") provide financial products and services in the United States. VRIAC is authorized to conduct its insurance business in all states and in the District of Columbia, Guam, Puerto Rico and the Virgin Islands.
Business Update
On January 2, 2025, the Company's ultimate parent, Voya Financial, acquired the full-service retirement plan business of OneAmerica Financial. This acquisition was accomplished through the purchase of legal entities and an indemnity reinsurance agreement through which we will administer group annuity contracts on behalf of American United Life Insurance Company, an affiliate of OneAmerica Financial. As a result of the application of pushdown accounting associated with the acquisition, we recognized Additional paid-in capital of $175 million in the first quarter.
Results of Operations
The following table presents our Consolidated Statements of Operations for the periods indicated:
Year Ended December 31,
($ in millions) 2025 2024 Change
Revenues:
Net investment income $ 1,722 $ 1,482 $ 240
Fee income 1,336 1,136 200
Premiums 1 9 (8)
Net gains (losses) (132) (44) (88)
Other revenue 73 65 8
Total revenues 3,000 2,648 352
Benefits and expenses:
Interest credited and other benefits to contract owners/policyholders 873 770 103
Operating expenses 1,332 1,160 172
Net amortization of DAC and VOBA 102 73 29
Interest expense 2 2 -
Total benefits and expenses 2,309 2,005 304
Income before income taxes 691 643 48
Income tax expense 97 57 40
Net income $ 594 $ 586 $ 8
Year Ended December 31, 2025 compared to Year Ended December 31, 2024
Total revenues
Total revenuesincreased $352 million from $2,648 million to $3,000 million. The following items contributed to the overall increase.
Net investment income increased by $240 million from $1,482 million to $1,722 million primarily due to:
•income from acquired OneAmerica assets;
•overall market impacts to limited partnership valuations;
•active portfolio management; and
•interest rate movements.
The increase was partially offset by:
•higher investment expenses reflecting the additional OneAmerica assets.
Fee income increased by $200 million from $1,136 million to $1,336 million primarily due to:
•acquired OneAmerica assets; and
•higher average equity markets and strong commercial momentum.
Net gains (losses)worsened by $88 million from a loss of $44 million to a loss of $132 million primarily due to:
•net unfavorable changes in derivative valuations due to interest rate movements; and
•impairments on available-for-sale fixed maturity securities.
This was partially offset by:
•a favorable change in mark-to-market adjustments on securities subject to fair value option accounting primarily due to interest rate movements.
Total benefits and expenses
Total benefits and expenses increased $304 million from $2,005 million to $2,309 million. The following items contributed to the overall increase.
Interest credited and other benefits to contract owners/policyholders increased by $103 million from $770 million to $873 million primarily due to:
•interest credited associated with acquired OneAmerica spread-based assets.
Operating expenses increased by $172 million from $1,160 million to $1,332 million primarily due to:
•acquired business from OneAmerica; and
•investments in business growth.
Net amortization of DAC and VOBA increased by $29 million from $73 million to $102 million primarily due to:
•amortization of the VOBA asset acquired from the OneAmerica transaction.
Income tax expense
Income tax expense increased $40 million from $57 million to $97 million primarily due to:
•the Security Life of Denver Company capital loss benefit that was recorded in 2024. For more details, see the Income Taxes Note to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K;
•a decrease in the dividends received deduction; and
•an increase in income before income taxes.
Liquidity and Capital Resources
Liquidity refers to our ability to access sufficient sources of cash to meet the requirements of our operating, investing and financing activities. Capital refers to our long-term financial resources available to support business operations and future growth. Our ability to generate and maintain sufficient liquidity and capital depends on the profitability of the businesses, timing of cash flows on investments and products, general economic conditions and access to the capital markets and the other sources of liquidity and capital described herein.
The following presents a review of our sources and uses of liquidity and capital and should be read in its entirety and in conjunction with the Off-Balance Sheet Arrangements and Aggregate Contractual Obligations table included further below.
Liquidity Management
Our principal available sources of liquidity are product charges, investment income, proceeds from the maturity and sale of investments, proceeds from various borrowing channels and facilities, repurchase agreements, contract deposits, securities lending and capital contributions. Primary uses of these funds are payments of policyholder benefits, commissions and operating expenses, interest credits, investment purchases and contract maturities, withdrawals and surrenders and payment of dividends.
Our liquidity position is managed by maintaining adequate levels of liquid assets, such as cash, cash equivalents and short-term investments. As part of the liquidity management process, different scenarios are modeled to determine whether existing assets are adequate to meet projected cash flows. Key variables in the modeling process include interest rates, equity market movements, quantity and type of interest and equity market hedges, anticipated contract owner behavior, market value of the general account assets, variable separate account performance and implications of rating agency actions.
The fixed account liabilities are supported by a general account portfolio, principally composed of fixed rate investments with matching duration characteristics that can generate predictable, steady rates of return. The portfolio management strategy for the fixed account considers the assets available-for-sale. This strategy enables us to respond to changes in market interest rates, prepayment risk, relative values of asset sectors and individual securities and loans, credit quality outlook and other relevant factors. The objective of portfolio management is to maximize returns, taking into account interest rate and credit risk, as well as other risks. Our asset-liability management discipline includes strategies to minimize exposure to loss as interest rates and economic and market conditions change. In executing this strategy, we use derivative instruments to manage these risks. Our derivative counterparties are of high credit quality.
Additional Sources of Liquidity
Additional sources of liquidity include borrowing facilities to meet short-term cash requirements that arise in the ordinary course of business. For information regarding our reciprocal loan agreement with Voya Financial, see the Financing AgreementsNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual report on Form 10-K.
We hold approximately 41.1% of our assets in marketable securities. These assets include cash, U.S. Treasuries, agencies, corporate bonds, asset-backed securities, commercial mortgage-backed securities, collateralized mortgage obligations and equity securities. In the event of a temporary liquidity need, cash may be raised by entering into repurchase agreements or security lending agreements by temporarily lending securities and receiving cash collateral. Under our Liquidity Plan, up to 12% of our general account statutory invested assets may be allocated to repurchase and securities lending programs. At the time a temporary cash need arises, the actual percentage of statutory invested assets available for repurchase transactions will depend upon outstanding allocations to these programs. As of December 31, 2025, VRIAC had securities lending collateral assets of $575 million, which represents approximately 1.8% of its general account statutory invested assets.
Management believes that our sources of liquidity are adequate to meet our short-term cash obligations.
Capital Contributions and Dividends
See the Capital Contributions, Dividends and Statutory InformationNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual report on Form 10-K for information on capital contributions and dividends.
Collateral - Derivative Contracts
See the Derivative Financial InstrumentsNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual report on Form 10-K for information on collateral for derivatives.
Ratings
Our access to funding and our related cost of borrowing, collateral requirements for derivative instruments and the attractiveness of certain of our products to customers are affected by our credit ratings and insurance financial strength ratings, which are periodically reviewed by the rating agencies. Financial strength ratings and credit ratings are important factors affecting public confidence in an insurer and its competitive position in marketing products. Credit ratings are also important to our ability to raise liquidity through various borrowing channels and facilities, and for the cost of such financing.
A downgrade in our credit ratings or the credit or financial strength ratings of our Parent or rated affiliates could have a material adverse effect on our results of operations and financial condition. See A downgrade or a potential downgrade in our financial strength or credit ratings may result in a loss of business and adversely affect our results of operations and financial condition in Risk Factors in Part I, Item 1A. of this Annual Report on Form 10-K.
Financial strength ratings represent the opinions of rating agencies regarding the financial ability of an insurance company to meet its obligations under an insurance policy. Credit ratings represent the opinions of rating agencies regarding an entity's ability to repay its indebtedness. These ratings are not a recommendation to buy or hold any of our securities and they may be revised or revoked at any time at the sole discretion of the rating organization.
Rating agencies use an "outlook" statement for both industry sectors and individual companies. A stable outlook from rating agencies is an opinion generally indicating that the rating is not likely to change over the medium term.
Our financial strength and credit ratings as of the date of this Annual Report on Form 10-K are summarized in the following table.
Company
Fitch(1)
Moody's(2)
S&P(3)
Voya Retirement Insurance and Annuity Company
Financial Strength Rating
A+/Stable
A2/Stable
A+/Stable
(1)Fitch's financial strength ratings for insurance companies range from "AAA (exceptionally strong)" to "C (distressed)." Long-term credit ratings range from "AAA (highest credit quality)," which denotes exceptionally strong capacity for timely payment of financial commitments, to "D (default)."
(2) Moody's financial strength ratings for insurance companies range from "Aaa (exceptional)" to "C (lowest)." Numeric modifiers are used to refer to the ranking within the group with 1 being the highest and 3 being the lowest. These modifiers are used to indicate relative strength within a category. Long-term credit ratings range from "Aaa (highest)" to "C (default)."
(3)S&P's financial strength ratings for insurance companies range from "AAA (extremely strong)" to "D (default)." Long-term credit ratings range from "AAA (extremely strong)" to "D (default)."
In December 2025, Moody's confirmed its outlook for the U.S. life insurance sector as stable and Fitch confirmed its neutral outlook for the North American life insurance sector.
Other Minimum Guarantees
Other variable annuity contracts contain minimum interest rate guarantees and allow the contract holder to select either the market value of the account or the book value of the account at termination. The book value of the account is equal to deposits plus interest, less any withdrawals. Under the terms of the contract, the book value settlement is paid out over time. These guarantees are offered in our stabilizer and managed custody guarantee products.
Reinsurance
We reinsure our business through a diversified group of well-capitalized, highly rated reinsurers. However, we remain liable to the extent our reinsurers do not meet their obligations under the reinsurance agreements. Collectability of reinsurance balances is evaluated by monitoring ratings and evaluating the financial strength of our reinsurers. Large reinsurance recoverable balances are collateralized through secured trusts. For additional information regarding our reinsurance recoverable balances, see the ReinsuranceNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
Derivatives
We use derivatives for a variety of hedging purposes. We also have embedded derivatives within fixed maturities instruments and certain product features. See the Business, Basis of Presentation and Significant Accounting PoliciesNote and Derivative Financial InstrumentsNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K for further information.
In addition, we have entered into coinsurance with funds withheld and modified coinsurance reinsurance arrangements that contain embedded derivatives. The fair value of the embedded derivatives is based on the change in the fair value of the underlying assets held in the trust using the valuation methods and assumptions described for our investments held.
Off-Balance Sheet Arrangements and Aggregate Contractual Obligations
The following table presents our on- and off- balance sheet contractual obligations due in various periods as of December 31, 2025. The payments reflected in this table are based on our estimates and assumptions about these obligations, and consequently the actual cash outflows in future periods will vary, possibly materially, from those presented in the table.
Payments Due by Period
($ in millions) Total Less than 1 Year 1-3 Years 3-5 Years More than
5 Years
Contractual Obligations
Purchase obligations(1)
$ 1,995 $ 1,962 $ 33 $ - $ -
Reserves for insurance obligations(2)(3)
38,761 3,274 6,530 5,469 23,488
Retirement and other plans(4)
48 6 10 10 22
Short-term debt obligations(5)
43 43 - - -
Securities lending, repurchase agreements and collateral held(6)
839 733 - - 106
Total $ 41,686 $ 6,018 $ 6,573 $ 5,479 $ 23,616
(1) Purchase obligations consist primarily of outstanding commitments under mortgage loans, limited partnerships and private placement investments. These commitments may be funded any time within the terms of the underlying agreements. Because the timing of funding for these commitments cannot be reasonably estimated, the total amount of these commitments is presented in the "Less than 1 Year" category.
(2) Reserves for insurance obligations consist of amounts required to meet our future obligations for future policy benefits and contract owner account balances. Amounts presented in the table represent estimated cash payments under such contracts, including significant assumptions related to the receipt of future premiums, mortality, morbidity, lapse, retirement, and annuitization comparable with actual experience. These assumptions also include market growth and interest crediting assumptions. Estimated cash payments are undiscounted for the time value of money. Accordingly, the sum of cash flows presented of $38.8 billion significantly exceeds the sum of Future policy benefits and contract owner account balances of $33.2 billion recorded on our Consolidated Balance Sheets as of December 31, 2025. Estimated cash payments are also presented gross of reinsurance. Due to the significance of the assumptions used, the amounts presented could materially differ from actual results.
(3) Contractual obligations related to certain closed blocks that were divested through reinsurance to third parties with reserves in the amount of $0.8 billion, have been excluded from the table. Although we are not relieved of our legal liability to the contract holder for these closed blocks, third-party collateral of $0.9 billion has been provided for the payment of the related insurance obligations. The sufficiency of collateral held for any individual block may vary.
(4) Includes estimated benefit payments under our non-qualified pension plans, and estimated benefit payments under our other postretirement benefit plans.
(5) Primarily represents payments to Voya Financial under the reciprocal loan agreement. See the Financing AgreementsNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
(6) Securities lending agreements, repurchase agreements, and collateral held represent the liability to return collateral received from counterparties under securities lending agreements, OTC derivative, and cleared derivative contracts as well as the obligations related to borrowings under repurchase agreements. Securities lending agreements include provisions which permit us to call back securities with minimal notice and accordingly, the payable is classified as having a term of less than 1 year. Additionally, securities lending agreements include off-balance sheet non-cash collateral of $13 million as of December 31, 2025.
Securities Lending Program
See the Business, Basis of Presentation and Significant Accounting PoliciesNote and the InvestmentsNotes in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K for information on our securities lending program.
FHLB
We are currently a member of the FHLB of Boston and may engage in transactions with FHLB for investment income enhancement and/or liquidity purposes. We are required to maintain a collateral deposit to back any funding agreements issued by the FHLB. We have the ability to obtain funding from the FHLB in the form of non-putable funding agreements, based on a percentage of the value of our assets and subject to the availability of eligible collateral. The types of securities generally pledged include mortgage securities, commercial real estate and U.S. treasury securities. Our borrowing capacity is also limited by the lending value of our assets pledged to FHLB. As of December 31, 2025, our available borrowing capacity as per our pledged assets was approximately $1,479 million.
We had $1,172 million and $721 million in non-putable FHLB funding agreements as of December 31, 2025 and 2024, respectively, which are included in Future policy benefits and contract owner account balances on the Consolidated Balance Sheets. As of December 31, 2025 and 2024, we had assets with a market value of approximately $1,663 million and $1,238 million, respectively, which collateralized the FHLB funding agreements.
FABN
We participate in a FABN program, pursuant to which we may issue funding agreements to a Delaware special purpose statutory trust (the "Trust"), in exchange for proceeds from the Trust's medium-term note issuances. These notes are secured by the funding agreements.
The FABN program is intended to diversify our liability profile and provide an additional source of investment income enhancement. Compared to other general account liabilities, FABN has a different cash flow profile and is designed to support our funding strategy.
On November 24, 2025, we completed our inaugural issuance under the program, offering $400 million of Trust notes with a fixed interest rate of 4.6% per annum, maturing in November 2030.
Statutory Capital and Risk-Based Capital
The Connecticut Insurance Department (the "Department") recognizes only statutory accounting practices prescribed or permitted by the State of Connecticut for determining and reporting the financial condition and results of operations of an insurance company and for determining its solvency under the Connecticut Insurance Law. The NAIC Accounting Practices and Procedures Manual has been adopted as a component of prescribed or permitted practices by the State of Connecticut.
We are subject to minimum RBC requirements established by the Department. The formulas for determining the amount of RBC specify various weighting factors that are applied to financial balances or various levels of activity based on the perceived degree of risk. Regulatory compliance is determined by a ratio of TAC, as defined by the NAIC, to RBC requirements, as defined by the NAIC.
For information regarding our statutory capital and surplus, see the Capital Contributions, Dividends and Statutory InformationNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
Critical Accounting Judgments and Estimates
General
The preparation of financial statements in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Critical estimates and assumptions are evaluated on an on-going basis based on historical developments, market conditions, industry trends and other information that is reasonable under the circumstances. There can be no assurance that actual results will conform to estimates and assumptions and that reported results of operations will not be materially affected by the need to make future accounting adjustments to reflect changes in these estimates and assumptions from time to time. Those estimates are inherently subject to change and actual results could differ from those estimates, and the differences may be material to the accompanying Consolidated Financial Statements.
We have identified the following accounting judgments and estimates as critical in that they involve a higher degree of judgment and are subject to a significant degree of variability:
•Valuation of investments and derivatives;
•Investment impairments;
•Income taxes; and
•Contingencies.
In developing these accounting estimates, we make subjective and complex judgments that are inherently uncertain and subject to material changes as facts and circumstances develop. Although variability is inherent in these estimates, we believe the amounts provided are appropriate based on the facts available upon preparation of the Consolidated Financial Statements.
The above critical accounting estimates are described in the Business, Basis of Presentation and Significant Accounting PoliciesNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
Valuation of Investments and Derivatives
Our investment portfolio includes certain investments recorded at fair value and consists of public and private fixed maturity securities, commercial mortgage and other loans, equity securities, short-term investments, other invested assets, and derivative financial instruments. We enter into interest rate, equity market, credit default, and currency contracts, including swaps, futures, forwards, caps, floors, and options, to reduce and manage various risks associated with changes in value, yield, price, cash flow or exchange rates of assets or liabilities held or intended to be held, or to assume or reduce credit exposure associated with a referenced asset, index or pool. We also utilize options and futures on equity indices to reduce and manage risks associated with our annuity products.
See the Investments Note and the Derivative Financial InstrumentsNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K for further information.
Investments
We measure the fair value of our financial assets and liabilities based on assumptions used by market participants in pricing the asset or liability, which may include inherent risk, restrictions on the sale or use of an asset, or nonperformance risk, including our own credit risk. The estimate of fair value is the price that would be received to sell an asset or paid to transfer a liability ("exit price") in an orderly transaction between market participants in the principal market, or the most advantageous market in the absence of a principal market, for that asset or liability. We use a number of valuation sources to determine the fair values of our financial assets and liabilities, including quoted market prices, third-party commercial pricing services, third-party brokers, industry-standard, vendor-provided software that models the value based on market observable inputs, and other internal modeling techniques based on projected cash flows.
We categorize our financial instruments into a three-level hierarchy based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument.
When available, the estimated fair value of securities is based on quoted prices in active markets that are readily and regularly obtainable. When quoted prices in active markets are not available, the determination of estimated fair value is based on market standard valuation methodologies, including discounted cash flows, matrix pricing or other similar techniques. Inputs to these methodologies include, but are not limited to, market observable inputs such as benchmark yields, credit quality, issuer spreads, bids, offers and cash flow characteristics of the security. For privately placed bonds, we also consider such factors as the net worth of the borrower, value of the collateral, the capital structure of the borrower, the presence of guarantees, and the borrower's ability to compete in its relevant market. Valuations are reviewed and validated monthly by an internal valuation committee using price variance reports, comparisons to internal pricing models, back testing of recent trades, and monitoring of trading volumes, as appropriate.
The valuation of financial assets and liabilities involves considerable judgment, is subject to considerable variability, is established using management's best estimate, and is revised as additional information becomes available. As such, changes in, or deviations from, the assumptions used in such valuations can significantly affect our results of operations. Financial markets are subject to significant movements in valuation and liquidity, which can impact our ability to liquidate and the selling price that can be realized for our securities.
Derivatives
Derivatives are carried at fair value, which is determined using the Company's derivative accounting system in conjunction with observable key financial data from third-party sources, such as yield curves, exchange rates, S&P 500 Index prices, Overnight Index Swap ("OIS") rates, and Secured Overnight Financing Rates ("SOFR"). Valuations for our futures contracts are based on unadjusted quoted prices from an active exchange. Counterparty credit risk is considered and incorporated in our valuation process through counterparty credit rating requirements and monitoring of overall exposure. Our own credit risk is also considered and incorporated in our valuation process.
We have certain credit default swaps ("CDS") and options that are priced by third party vendors or by using models that primarily use market observable inputs, but contain inputs that are not observable to market participants.
We also have investments in certain fixed maturities, and we have entered into coinsurance with funds withheld and modified coinsurance reinsurance arrangements that contain embedded derivatives. The fair value of the embedded derivatives is based on the change in the fair value of the underlying assets held in the trust using the valuation methods and assumptions described for our investments held.
The valuation of derivatives involves considerable judgment, is subject to considerable variability, is established using management's best estimate and is revised as additional information becomes available. As such, changes in, or deviations from, these assumptions used in such valuations can have a significant effect on the results of operations.
For additional information regarding the fair value of our investments and derivatives, see the Fair Value MeasurementsNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K. For additional information regarding the sensitivities of interest rate risk and equity market price risk and impact on investments and derivatives, see Quantitative and Qualitative Disclosures About Market Riskin Part II, Item 7A. of this Annual Report on Form 10-K.
Investment Impairments
Fixed maturities, available-for-sale, and mortgage loans on real estate can be subject to credit impairment, which can have a significant effect on the results of operations. Refer to the Business, Basis of Presentation and Significant Accounting PoliciesNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K for an understanding of our methodology and significant inputs considered within the allowance for credit losses and impairments. For additional information regarding the evaluation process for credit impairments, refer to the Investments Note in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
Income Taxes
The results of our operations are included in the consolidated tax return of Voya Financial. Generally, our Consolidated Financial Statements recognize the current and deferred income tax consequences that result from our activities during the current and preceding periods pursuant to the provisions of ASC Topic 740, "Income Taxes" as if we were a separate taxpayer rather than a member of Voya Financial's consolidated income tax return group, with the exception of any net operating loss carryforwards and capital loss carryforwards, which are recorded pursuant to the tax sharing agreement.
Under our tax sharing agreement, Voya Financial will pay us for the tax benefits of ordinary and capital losses only in the event that the consolidated tax group actually uses the tax benefit of losses generated.
Valuation Allowances
We use certain assumptions and estimates in determining the income taxes payable or refundable to/from Voya Financial for the current year, the deferred tax liabilities and assets for items recognized differently in our Consolidated Financial Statements from amounts shown on our income tax returns, and the federal income tax expense. Determining these amounts requires analysis and interpretation of current tax laws and regulations, including the loss limitation rules associated with change in control. We exercise considerable judgment in evaluating the amount and timing of recognition of the resulting income tax liabilities and assets. These judgments are reevaluated on a quarterly basis and as regulatory and business factors change.
We had federal net operating losses of $535 million as of December 31, 2025, which we expect to fully utilize in future years from the four available sources of taxable income. Additionally, we had overall unrealized capital losses of $1.3 billion in Accumulated other comprehensive income as of December 31, 2025, which we expect to be utilized by our hold-to-maturity tax planning strategy. Future decreases to taxable income, increases to interest rates and/or the occurrence of other unexpected circumstances, such as changes in the economic environment, liquidity and investment strategy, could result in recording a related valuation allowance on our deferred tax assets in a future period.
For additional understanding over the Company's valuation allowance, refer to the Business, Basis of Presentation and Significant Accounting PoliciesNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual report on Form 10-K.
Tax Contingencies
We recognize the tax benefit from an uncertain tax position only if it is more likely than not to be sustained under examination by the applicable taxing authority. We also consider positions that have been reviewed and agreed to as part of an examination
by the applicable taxing authority. For items that meet the more-likely-than-not recognition threshold, we measure the tax position as the largest amount of benefit that is more than 50% likely to be realized upon ultimate resolution with the applicable tax authority that has full knowledge of all relevant information. Tax positions that do not meet the more-likely-than-not standard are not recognized.
Changes in Law
Certain changes or future events, such as changes in tax legislation, completion of tax audits, planning opportunities and expectations about future outcomes could have an impact on our estimates of deferred taxes, valuation allowances, tax provisions and effective tax rates.
In August 2022, the Inflation Reduction Act of 2022 was signed into law, which includes a 15% corporate alternative minimum tax ("CAMT"). The CAMT is effective in taxable years beginning after December 31, 2022. In September 2024, the Department of Treasury issued proposed regulations providing additional guidance on the CAMT. While we do not expect to be subject to the CAMT for 2025, we are continuing to review the proposed regulations, and our CAMT determination will need to be evaluated in light of future guidance.
In July 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law, which includes changes to the Internal Revenue Code. The OBBBA did not have a material impact on our financial statements.
Contingencies
For information regarding our contingencies, see the Commitments and ContingenciesNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
Impact of New Accounting Pronouncements
For information regarding the impact of new accounting pronouncements, see the Business, Basis of Presentation and Significant Accounting PoliciesNote in our Consolidated Financial Statements in Part II, Item 8. of this Annual Report on Form 10-K.
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