TMHC · Read the filing

ITEM 7 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General Overview

Our principal business is residential homebuilding and the development of lifestyle communities with operations across 12 states. We provide a collection of homes across a wide range of price points to appeal to a variety of consumer groups. We design, build and sell single and multi-family detached and attached homes in traditionally high growth markets for entry-level, move-up, and resort lifestyle buyers. Our homebuilding segments operate under the Taylor Morrison and Esplanade brand names. We also have a “Build-to-Rent” homebuilding business which operates under the Yardly brand name. In addition, we provide financial services to customers through our wholly owned mortgage subsidiary, TMHF, title services through our wholly owned title services subsidiary, Inspired Title, and homeowner’s insurance policies through our insurance agency, TMIS. For reporting purposes, Taylor Morrison Home Corporation (“TMHC”) and Taylor Morrison Communities, Inc. ("TM Communities") are substantially similar, with no material differences. Our business is organized into multiple homebuilding operating components, and a financial services component, all of which are organized as four operating segments: East, Central, West and Financial Services, as follows:

Central Austin, Dallas, Denver, Houston, and Indianapolis

(1) During the year ended December 31, 2025, we combined our Portland and Seattle divisions to become Pacific Northwest.

Annual Overview and Business Strategy

We benefit from a dynamic and flexible operating strategy that allows us to serve a broad range of consumers and respond to market and economic conditions, community by community, to maximize our financial performance. This flexible but prudent approach allows for shifts in our pricing strategies, community openings, financing incentives, starts volume and land investments to minimize risk and recalibrate affordability, while maintaining strong performance metrics.

We continuously adjust sales prices and our finance product offerings across our portfolio based on market conditions to drive sales while also protecting the value of our backlog. Pricing adjustments are utilized in a variety of ways including finance incentives, adjustments to the pricing of lot premiums, options and upgrades, and in some instances base price of the home. Each community’s buyer profile mix of adjustments is dependent on its backlog, inventory, duration, and competitive dynamics.

Our balance sheet remained strong at December 31, 2025, ending the year with approximately $1.8 billion in total liquidity, a homebuilding debt-to-capitalization ratio of 26.0% on a gross basis and 17.8%net of unrestricted cash. We believe we have a balanced capital allocation approach and continue to allocate capital and manage our land portfolio to acquire assets that have attractive characteristics, including access to preferred schools, shopping, recreation and transportation facilities. In connection with our overall land inventory management and investment process, our management team reviews these considerations, as well as other financial metrics, to decide the highest and best use of our capital.

Factors Affecting Comparability of Results

For the years ended December 31, 2025, 2024, and 2023 we recognized $28.8 million, $5.0 million, and $11.8 million in inventory impairment charges, respectively. Impairment charges are recorded to Cost of home closings on the Consolidated statements of operations.

For the year ended December 31, 2024, we recognized $17.8 million in impairment charges relating to our Urban Form properties. Impairment charges relating to our Urban Form properties are recorded to Amenity and other expenses on the Consolidated statements of operations. For the years ended December 31, 2025 and 2023, no such impairment charges were incurred.

At December 31, 2025, 2024, and 2023, our legal accruals were $53.3 million, $49.1 million, and $26.2 million, respectively. Legal expenses and settlements are recorded to Other expense, net on the Consolidated statements of operations.

For the years ended December 31, 2025, 2024, and 2023, we recognized $14.8 million, $9.5 million, and $4.2 million in pre-acquisition abandonment charges, respectively. These charges are recorded to Other expense, net on the Consolidated statements of operations.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

For the years ended December 31, 2025 and 2023, we recognized $13.3 million and $0.3 million of loss on extinguishment of debt, net, respectively. These charges are recorded to Loss on extinguishment of debt, net on the Consolidated statements of operations. There was no loss or gain on extinguishment of debt for the year ended December 31, 2024.

For the years ended December 31, 2024 and 2023, we recognized $23.1 million and $14.8 million as a change in estimate for our Estimated Development Liability. There was no change in our Estimated Development Liability on our Consolidated balance sheet for the year ended December 31, 2025. These charges are recorded to Other expense, net on the Consolidated statements of operations.

Critical Accounting Policies and Estimates

General

The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenue and expenses, and related disclosures of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions or conditions, impacting our reported results of operations and financial condition.

Certain accounting policies involve significant judgments and assumptions by management, which have a material impact on the carrying value of assets and liabilities and the recognition of income and expenses. The estimates and assumptions used by management are based on historical experience and other factors, which are believed to be reasonable under the circumstances. The significant accounting policies that management believes are the most critical to aid in fully understanding and evaluating our reported financial results are described below.

Revenue Recognition

Revenue is recognized in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers ("ASC 606"). The standard’s core principle requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.

Home and Land Closings Revenue

Under ASC 606, the following steps are applied to determine home closings revenue and land closings revenue recognition: (1) identify the contract(s) with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. Our home sales transactions have one contract, with one performance obligation, with each customer to build and deliver a home (or develop and deliver land). Based on the application of the five steps, the following summarizes the timing and manner of home and land closings revenue:

•Revenue from home closings is recognized when the buyer has made the required minimum down payment, obtained necessary financing, the risks and rewards of ownership are transferred to the buyer, and we have no continuing involvement with the property, which is generally upon the close of escrow. Revenue is reported net of any discounts and incentives.

•Revenue from land closings is recognized when a significant down payment is received, title passes and collectability of the receivable, if any, is reasonably assured, and we have no continuing involvement with the property, which is generally upon the close of escrow. From time to time we may enter into land or other asset sales that require recognition of revenue over time, however as of December 31, 2025, no such transactions have been material.

Amenity and Other Revenue

We own and operate certain amenities such as golf courses, club houses, and fitness centers, which require us to provide club members with access to the facilities in exchange for the payment of club dues. We collect club dues and other fees from club members, which are invoiced on a monthly basis. Revenue from our golf club operations is also included in Amenity and other revenue. Amenity and other revenue also includes revenue from our Urban Form and Build-to-Rent operations which is recorded as control transfers to the buyer at transaction close and when other criteria of ASC 606 are met. In addition, lease revenue is recognized by Urban Form for commercial and residential leases and Build-to-Rent operations for rental home leases.

Financial Services Revenue

Mortgage operations and hedging activity related to financial services are not within the scope of Topic 606. Generally, the loans TMHF originates are sold to third-party investors within a short period of time, on a non-recourse basis. Gains and losses from the sale of mortgages are recognized in accordance with ASC Topic 860-20, Sales of Financial Assets. TMHF generally does not have continuing involvement with the transferred assets; therefore, we derecognize the mortgage loans at time of sale, based on the difference between the selling price and carrying value of the related loans upon sale,

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

recording a gain/loss on sale in the period of sale. Also included in Financial services revenue/expenses is the realized and unrealized gains and losses from hedging instruments. ASC Topic 815-25, Derivatives and Hedging, requires that all hedging instruments be recognized as assets or liabilities on the Consolidated balance sheets at their fair value. We do not meet the criteria for hedge accounting; therefore, we account for these instruments as free-standing derivatives, with changes in fair value recognized in Financial services revenue/expenses on the Consolidated statement of operations in the period in which they occur.

Real Estate Inventory Valuation and Costing

Inventory consists of raw land, land under development, homes under construction, completed homes, and model homes, all of which are stated at cost. In addition to direct carrying costs, we also capitalize interest, real estate taxes, and related development costs that benefit the entire community, such as field construction supervision and related direct overhead. Vertical construction costs are accumulated and charged to Cost of home closings at the time of home closings when revenue is recognized using the specific identification method. Land acquisition, development, interest, and real estate taxes are capitalized and allocated generally using the relative sales value method. Generally, all overhead costs relating to purchasing, vertical construction, and construction utilities are considered overhead costs and are allocated on a per unit basis. These costs are capitalized to inventory beginning with the start of development through construction completion. Changes in estimated costs to be incurred in a community are generally allocated to the remaining project on a prospective basis.

The life cycle of the community generally ranges from two to five years, commencing with the acquisition of unentitled or entitled land, continuing through the land development phase and concluding with the sale, construction and delivery of homes. Actual community lives will vary based on the size of the community, the sales absorption rate and whether we purchased the property as raw land or finished lots.

We capitalize qualifying interest costs to inventory during the development and construction periods. Capitalized interest is charged to Cost of home closings when the related inventory is charged to Cost of home closings.

We assess the recoverability of our inventory in accordance with the provisions of ASC Topic 360, Property, Plant, and Equipment ("ASC 360"). We review our real estate inventory for indicators of impairment on a community-level basis during each reporting period. If indicators of impairment are present for a community, an undiscounted cash flow analysis is generally prepared to determine if the carrying value of the assets in that community exceeds the estimated undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, in certain circumstances, fair value can also be determined through other methods, such as appraisals, contractual purchase offers, and other third-party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions.

In certain cases, we may elect to cease development and/or marketing of an existing community if we believe the economic performance of the community would be maximized by deferring development for a period of time to allow for market conditions to improve. We refer to such communities as long-term strategic assets. The decision may be based on financial and/or operational metrics as determined by us. For those communities that have been temporarily closed or development has been discontinued, we do not allocate or capitalize interest or other costs to the community’s inventory until activity resumes and such costs are expensed as incurred. If we decide to cease development, we will evaluate the project for impairment and discontinue future development and marketing activity until such a time when we believe that market conditions have improved and positive economic performance can be achieved. Our assessment of the carrying value of our long-term strategic assets typically includes subjective estimates of future performance, including the timing of when development will recommence, the type of product to be offered, and the margin to be realized. In the future, some of these inactive communities may be re-opened while others may be sold.

In the ordinary course of business, we enter into land banking agreements with various sellers to acquire lots. As a method of acquiring land in staged takedowns, while limiting risk and minimizing the use of funds from our available cash or other financing sources, we may transfer our right under certain specific performance agreements, for land we own, to entities owned by third parties (“land banking arrangements”). These entities use equity contributions from their owners and/or incur debt to finance the acquisition and development of the land. We incur interest expense and fees on these arrangements. We capitalize qualifying interest costs to inventory during the development and construction periods with the remainder expensed and included in Interest expense/(income), net on the Consolidated statements of operations. These lots are considered controlled, however we are not legally obligated to purchase lots under these agreements and would forfeit any existing deposits and could be subject to financial and other penalties if the lots are not purchased. We do not have an ownership interest in these entities or title to their assets and do not guarantee their liabilities. As such, these entities are not consolidated. These land banking arrangements help us manage the financial and market risk associated with land holdings which are not included on the Consolidated balance sheets.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

considered held for sale once it meets all criteria in accordance with ASC 360. Land held for sale is recorded at the lower of cost or fair value less costs to sell. In determining the value of land held for sale, we consider recent offers received, prices for land in recent comparable sales transactions, and other factors. We record fair value adjustments for land held for sale within Cost of land closings on the Consolidated statements of operations.

INSURANCE COSTS, SELF-INSURANCE RESERVES AND WARRANTY RESERVES

Insurance Costs and Self-Insurance Reserves

We are the parent of Beneva Indemnity Company (“Beneva”), which provides insurance coverage for construction defects discovered up to ten years following the close of a home, coverage for premise operations risk, and from time to time, property damage. We have certain deductible limits for each of our policies under our workers’ compensation, automobile, and general liability insurance policies, and we record expense and liabilities for the estimated costs of potential claims for construction defects. We also generally require our subcontractors and design professionals to indemnify us and provide evidence of insurance for liabilities arising from their work, subject to certain limitations. Excess liability exposure is aggregated annually and applied in excess of automobile liability, employer’s liability under workers compensation and general liability policies. We accrue for the expected costs associated with the deductibles and self-insured amounts under our various insurance policies based on historical claims, estimates for claims incurred but not reported, and potential for recovery of costs from insurance and other sources. The estimates are subject to significant variability due to factors such as claim settlement patterns, litigation trends, and the extended period of time in which a construction defect claim might be made after the closing of a home.

Our loss reserves for claims insured by Beneva are based on factors that include an actuarial study for historical and anticipated claims, trends related to similar product types, number of homes closed, and geographical areas. We regularly review the reasonableness and adequacy of our reserves and make adjustments to the balance of the preexisting reserves to reflect changes in trends and historical data as information becomes available. Self-insurance reserves are included in Accrued expenses and other liabilities on the Consolidated balance sheets. Due to the degree of judgment required in making these estimates and the inherent uncertainty in potential outcomes, it is reasonably possible that actual costs could differ from those recorded and such differences could be material, resulting in a change in future estimated reserves.

Warranty Reserves

We offer a one-year limited warranty to cover various defects in workmanship or materials, a two-year limited warranty on certain systems (such as electrical or cooling systems), and a ten-year limited warranty on structural defects. In addition, any outstanding warranties which were offered by our acquired companies are also honored. We also provide third-party warranty coverage on homes where required by FHA or VA lenders. Warranty reserves are established as homes close in an amount estimated to be adequate to cover expected costs of materials and outside labor during warranty periods. Our warranty is not considered a separate performance obligation in the sales arrangement since it is not priced apart from the home; therefore, it is accounted for in accordance with ASC Topic 450, Contingencies, which states that warranties that are not separately priced are generally accounted for by accruing the estimated costs to fulfill the warranty obligation. We accrue the estimated costs to fulfill the warranty obligation at the time a home closes, as a component of Cost of home closings on the Consolidated statements of operations and warranty reserves are included in Accrued expenses and other liabilities on the Consolidated balance sheets.

INVESTMENTS IN UNCONSOLIDATED ENTITIES AND VARIABLE INTEREST ENTITIES

We are involved in joint ventures with independent third parties for real estate development, homebuilding and mortgage lending activities. We use the equity method of accounting for entities over which we exercise significant influence but do not have a controlling interest over the operating and financial results of the investee. For unconsolidated entities in which we function as the managing member, we have evaluated the rights held by our joint venture partners and determined that they have substantive participating rights that preclude the presumption of control. For these unconsolidated joint ventures, our share of net earnings or losses is included in Net income from unconsolidated entities on the Consolidated statements of operations when earned and distributions are credited against our Investment in unconsolidated entities on the Consolidated balance sheets when received.

We evaluate our investments in unconsolidated joint ventures for indicators of impairment semi-annually. A series of operating losses of an investee or other factors may indicate that a decrease in value of our investment in the unconsolidated entity has occurred which is other-than-temporary. The amount of impairment recognized, if any, is the excess of the investment’s carrying amount over its estimated fair value. Additionally, we consider various qualitative factors to determine if a decrease in the value of the investment is other-than-temporary. These factors include age of the venture, stage in its life cycle, intent and ability to recover our investment in the unconsolidated entity, financial condition and long-term prospects of the unconsolidated entity, short-term liquidity needs of the unconsolidated entity, trends in the general economic environment of the land, entitlement status of the land held by the unconsolidated entity, overall projected returns on investment, defaults under contracts with third parties (including bank debt), recoverability of the investment through future cash flows and relationships with the other partners. If we believe that the decline in the fair value of the investment is temporary, then no impairment is recorded.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

In the ordinary course of business, we enter into land purchase contracts, lot option contracts and land banking arrangements in order to procure land or lots for the construction of homes. Such contracts enable us to control significant lot positions with a minimal initial capital investment and substantially reduce the risks associated with land ownership and development. In accordance with ASC Topic 810, Consolidation, we have concluded that when we enter into an option or purchase agreement to acquire land or lots and pay a non-refundable deposit, a variable interest entity ("VIE") may be created because we are deemed to have provided subordinated financial support that will absorb some or all of an entity’s expected losses, or benefit from rights to residual returns, if they occur. If we are the primary beneficiary of the VIE, we consolidate the VIE in our Consolidated financial statements and reflect such assets and liabilities as Consolidated real estate not owned and Liabilities attributable to consolidated real estate not owned, respectively, on the Consolidated balance sheets.

VALUATION OF DEFERRED TAX ASSETS

We account for income taxes using the asset and liability method, which requires that deferred tax assets and liabilities be recognized based on future tax consequences of temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply in the years in which the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period when the changes are enacted. Changes in existing federal and state tax laws and corporate income tax rates could affect future tax results and the realization of deferred tax assets over time.

In accordance with ASC Topic 740-10, Income Taxes, we evaluate our deferred tax assets by tax jurisdiction, including the benefit from net operating loss (“NOL”) carryforwards by tax jurisdiction, to determine if a valuation allowance is required. We must assess, using significant judgments, whether a valuation allowance should be established based on the consideration of all available evidence using a “more likely than not” standard with significant weight being given to evidence that can be objectively verified. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the length of statutory carryforward periods, experience with operating losses and experience of utilizing tax credit carryforwards and tax planning alternatives. We have not made any material changes in our methodology used to establish our valuation allowance during these periods. If a specific event or transaction were to occur that impacts our valuation allowance, we would reassess the evidence and adjust the allowance accordingly. Although management believes our valuation allowance is reasonable, no assurance can be given that the final tax outcome of these matters will not be different from our current valuation of our deferred tax assets and it is reasonably possible that such differences could be material, resulting in a change in future valuations.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

Results of Operations

The following table sets forth our results of operations for the periods presented:

Years Ended December 31,

(Dollars in thousands, except per share information) 2025 2024 2023

Statements of Operations Data:

Net income from unconsolidated entities (4,867) (6,347) (8,757)

Loss on extinguishment of debt, net 13,324 — 295

Net income attributable to non-controlling interests (8,763) (3,261) (812)

Home closings gross margin 22.5 % 24.4 % 23.9 %

Average selling price per home closed $ 597 $ 601 $ 623

Effective income tax rate 24.1 % 23.3 % 24.4 %

Earnings per common share-

Non-GAAP Measures

In addition to the results reported in accordance with GAAP, we have provided information in this Annual Report relating to: (i) adjusted net income and adjusted earnings per common share, (ii) adjusted income before income taxes and related margin, (iii) adjusted home closings gross margin, (iv) EBITDA and adjusted EBITDA and (v) net homebuilding debt to capitalization ratio.

Adjusted net income, adjusted earnings per common share and adjusted income before income taxes and related margin are non-GAAP financial measures that reflect the net income/(loss) available to the Company excluding, to the extent applicable in a given period, the impact of real estate and inventory impairment charges, impairment of investment in unconsolidated entities, pre-acquisition abandonment charges, unique and unusual warranty charges, gains/losses on land transfers to joint ventures, extinguishment of debt, net, and legal reserves or settlements that the Company deems not to be in the ordinary course of business and in the case of adjusted net income and adjusted earnings per common share, the tax impact due to such items. The legal reserves or settlements amounts presented in the year ended December 31, 2024

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

relate to the same claim and are discussed in Note 13 - Commitments and Contingencies in the Notes to the Consolidated financial statements included in this Annual Report.

EBITDA and adjusted EBITDA are non-GAAP financial measures that measure performance by adjusting net income before allocation to non-controlling interests to exclude, as applicable, interest expense/(income), net, amortization of capitalized interest, income provisions, depreciation and amortization to calculate EBITDA. Adjusted EBITDA further excludes non-cash compensation expense, if any, real estate and inventory impairment charges, impairment of investments in unconsolidated entities, pre-acquisition abandonment charges, unique and unusual warranty charges, gains/losses on land transfers to joint ventures, extinguishment of debt, net and legal reserves or settlements that the Company deems not to be in the ordinary course of business, in each case, as applicable in a given period.

Net homebuilding debt to capitalization ratio is a non-GAAP financial measure we calculate by dividing (i) total debt, plus unamortized debt issuance cost/(premium), net, and less mortgage warehouse borrowings, net of unrestricted cash and cash equivalents ("net homebuilding debt"), by (ii) total capitalization (the sum of net homebuilding debt and total stockholders’ equity).

Adjusted home closings gross margin is a non-GAAP financial measure based on GAAP home closings gross margin (which is inclusive of capitalized interest), excluding inventory impairment charges and unique and unusual warranty charges.

Management uses these non-GAAP financial measures to evaluate our performance on a consolidated basis, as well as the performance of our segments, and to set targets for performance-based compensation. We also use the ratio of net homebuilding debt to total capitalization ratio as an indicator of overall financial leverage and to evaluate our performance against other companies in the homebuilding industry. In the future, we may include additional adjustments in the above-described non-GAAP financial measures to the extent we deem them appropriate and useful to management and investors.

We believe that adjusted net income, adjusted earnings per common share, adjusted income before income taxes and related margin, as well as EBITDA and adjusted EBITDA, are useful for investors in order to allow them to evaluate our operations without the effects of various items we do not believe are characteristic of our ongoing operations or performance and also because such metrics assist both investors and management in analyzing and benchmarking the performance and value of our business. Adjusted EBITDA also provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, or unusual items. Because we use the net homebuilding debt to total capitalization ratio to evaluate our performance against other companies in the homebuilding industry, we believe this measure is also relevant and useful to investors for that reason. We believe that adjusted home closings gross margin is useful to investors because it allows investors to evaluate the performance of our homebuilding operations without the varying effects of items or transactions we do not believe are characteristic of our ongoing operations or performance.

These non-GAAP financial measures should be considered in addition to, rather than as a substitute for, the comparable U.S. GAAP financial measures of our operating performance or liquidity. Although other companies in the homebuilding industry may report similar information, their definitions may differ. We urge investors to understand the methods used by other companies to calculate similarly-titled non-GAAP financial measures before comparing their measures to ours.

A reconciliation of adjusted net income, adjusted earnings per common share, adjusted income before income taxes and related margin, adjusted home closings gross margin, EBITDA, adjusted EBITDA, and ratio of net homebuilding debt to total capitalization to the comparable GAAP measures follows. For purposes of our presentation of our non-GAAP financial measures for the year ended December 31, 2024, such measures have been recast to include certain adjustments being presented in the year ended December 31, 2025 that were previously deemed immaterial in the prior period.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

Adjusted Net Income and Adjusted Earnings Per Common Share

Year ended December 31,

(Dollars in thousands, except per share data) 2025 2024

Legal reserves or settlements — 23,682

Pre-acquisition abandonment charges 14,791 9,453

Loss on extinguishment of debt, net 13,324 —

Tax impact due to above non-GAAP reconciling items (15,049) (15,488)

Adjusted earnings per common share - Basic $ 8.38 $ 8.91

Adjusted earnings per common share - Diluted $ 8.24 $ 8.74

Adjusted Income Before Income Taxes and Related Margin

Year ended December 31,

Legal reserves or settlements — 23,682

Pre-acquisition abandonment charges 14,791 9,453

Loss on extinguishment of debt, net 13,324 —

Income before income taxes margin 12.8 % 14.2 %

Adjusted income before income taxes margin 13.6 % 15.0 %

Adjusted Home Closings Gross Margin

Year Ended December 31,

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

EBITDA and Adjusted EBITDA Reconciliation

Year Ended December 31,

Net income before allocation to non-controlling interests $ 791,263 $ 886,570

Legal reserves or settlements — 23,682

Pre-acquisition abandonment charges 14,791 9,453

Loss on extinguishment of debt, net 13,324 —

EBITDA as a percentage of total revenue 14.8 % 15.9 %

Adjusted EBITDA as a percentage of total revenue 15.9 % 16.9 %

Debt to Capitalization Ratios Reconciliation

As of December 31,

Plus: unamortized debt issuance cost, net 11,667 6,616

Less: mortgage warehouse facilities borrowings (82,605) (174,460)

Total homebuilding debt to capitalization ratio 26.0 % 24.9 %

Net homebuilding debt to capitalization ratio 17.8 % 20.0 %

Year Ended December 31, 2025 Compared to Year Ended December 31, 2024

The following tables and related discussion set forth key operating and financial data for our operations as of and for the fiscal years ended December 31, 2025 and 2024. For similar operating and financial data and discussion of our fiscal 2024 results compared to our fiscal 2023 results, refer to Item 7, “Management’s Discussion and Analysis of Financial Condition

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

and Results of Operations” under Part II of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which was filed with the SEC on February 19, 2025, and is incorporated herein by reference.

Ending Active Selling Communities

Year Ended December 31, Change

Ending active selling communities were relatively consistent as of December 31, 2025 and 2024. The increase in the East segment was primarily attributable to the timing of community openings, including master planned communities, which were partially offset by community close-outs. The decreases in the Central and West segments were due to the close-out of several higher paced communities in certain markets. In addition, we strategically delayed certain community openings from the fourth quarter of 2025 into the first quarter of 2026.

Net Sales Orders

Year Ended December 31,

Net Sales Orders (1) Sales Value (1) Average Selling Price

(1)Net sales orders and sales value represent the number and dollar value, respectively, of new sales contracts executed with customers, net of cancellations.

The number of net sales orders decreased by 9.6% for the year ended December 31, 2025, compared to the prior year, which we believe to be primarily due to consumer apprehension as a result of macro economic factors such as mortgage interest rates and inflation which continue to remain elevated. To a lesser extent, we also experienced an increase in cancellations as a result of these factors. Average selling price on net sales orders decreased 2.7% year-over-year primarily due to an increase in discounts, partially offset by increases in option and lot premium revenues in certain markets.

Sales Order Cancellations

Cancellation Rate(1)

Year Ended December 31,

Total Company 13.2 % 9.5 %

(1)Cancellation rate represents the number of canceled sales orders divided by gross sales orders.

The total company cancellation rate for the year ended December 31, 2025 increased to 13.2 % from 9.5 %, compared to the prior year. We believe the higher cancellation rate was driven by market conditions, including the inability of homeowners to sell their current homes prior to closing on a new home, coupled with consumer apprehension as a result of macroeconomic factors such as mortgage interest rates and inflation, which continue to remain elevated. In addition, we have reduced required customer deposits as means of stimulating new sales orders which can further contribute to higher cancellation rates.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

Sales Order Backlog

As of December 31,

Sold Homes in Backlog (1) Sales Value Average Selling Price

(1)Sales order backlog represents homes under contract for which revenue has not yet been recognized at the end of the period (including homes sold but not yet started). Some of the sales contracts in our sales order backlog are subject to contingencies including mortgage loan approval and buyers selling their existing homes, which can result in future cancellations.

Total backlog units and total sales value decreased by 40.6% and 41.8%, respectively, at December 31, 2025 compared to December 31, 2024. Overall, we had fewer net sales orders and more quick move-in homes which sold and closed during the year ended December 31, 2025 compared to the year ended December 31, 2024, which contributed to the decrease in company-wide sales order backlog. All of our operating segments improved construction cycle times in the year ended December 31, 2025 which further contributed to the decrease in sales order backlog.

Home Closings Revenue, Net

Year Ended December 31,

Homes Closed Home Closings Revenue, Net Average Selling Price

The number of homes closed and home closings revenue, net remained relatively consistent for the year ended December 31, 2025, compared to the prior year. For the year ended December 31, 2025, we improved construction cycle times and sold and closed more quick move-in homes compared to the prior year which favorably impacted home closing units. However, we also experienced fewer net sales orders for the year ended December 31, 2025 as well as lower opening backlog compared to the prior year which unfavorably impacted home closing units.

Land Closings Revenue

Year Ended December 31,

We generally purchase land and lots with the intent to build and sell homes. However, in some locations where we act as a developer, we occasionally purchase land that includes commercially zoned parcels or areas designated for school or government use, which we typically sell to commercial developers or municipalities, as applicable. We also sell residential lots or land parcels to manage our land and lot supply on larger tracts of land or if we determine certain properties no longer fit our strategic plans. Land and lot sales occur at various intervals and varying degrees of profitability. Therefore, the revenue and gross margin from land closings will fluctuate from period to period, depending on market conditions and opportunities. Land closings revenue for the year ended December 31, 2025 decreased primarily due to the change in the East region. In the prior year, we sold various lots in our Florida market for a total of $27.9 million, but did not have similar sales in the current year.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

Amenity and Other Revenue

Year Ended December 31,

Central — — —

Several of our communities operate amenities such as golf courses, club houses, and fitness centers (generally in the East segment). We provide club members access to the amenity facilities and other services in exchange for club dues and fees. Our Corporate region includes the activity relating to our Build-to-Rent and Urban Form operations. Amenity and other revenue for the year ended December 31, 2025 in Corporate was primarily due to the sale of one Build-to-Rent project and the sale of one Urban Form asset for $55.2 million and $22.8 million, respectively. Amenity and other revenue for the year ended December 31, 2024 in Corporate was primarily due to the sale of two Build-to-Rent projects for an aggregate of $88.4 million.

Segment Home Closings Gross Margins and Adjusted Gross Margins

The following table sets forth a reconciliation of adjusted home closings gross margin to GAAP home closings gross margin on a segment basis (see “Non-GAAP Measures” above for additional information about our use of non-GAAP measures).

Year Ended December 31,

East Central West Consolidated

Consolidated home closings gross margin decreased 190 basis points to 22.5% for the year ended December 31, 2025, compared to 24.4% in the prior year. Adjusted home closings gross margin decreased 150 basis points to 23.0% for the year ended December 31, 2025, compared to 24.5% in the prior year. Home closings gross margin decreased in the East and Central regions primarily as a result of closing product mix. The East region was also negatively impacted by impairment and increased warranty charges. In addition, a decrease in average selling prices due to an increase in discounts, partially offset by increases in lot premium and option revenue, further contributed to the changes in home closings gross margin for the East and Central regions. The increase in the West region was primarily due to closing product mix. In addition, the West region was negatively impacted by an impairment charge during the year ended December 31, 2025.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

Financial Services

The following is a summary for the periods presented of financial services income before income taxes as well as supplemental data:

Year EndedDecember 31,

Financial services net income from unconsolidated entities 12,540 8,915 40.7 %

Financial services income before income taxes $ 117,329 $ 99,782 17.6 %

Total originations:

Year EndedDecember 31,

Supplemental data:

Funded origination breakdown:

Government (FHA,VA,USDA) 24 % 22 %

Other agency 72 % 75 %

Total agency 96 % 97 %

Non-agency 4 % 3 %

Total financial services revenue increased by 5.0% for the year ended December 31, 2025, compared to the prior year. The increase in total financial services revenue was primarily a result of increased revenue earned on the sale of loans and increased title production.

Sales, Commissions and Other Marketing Costs

Sales, commissions and other marketing costs, as a percentage of home closings revenue, net, marginally increased to 6.0% from 5.9% for the year ended December 31, 2025 compared to the prior year. The relatively consistent results are primarily driven by leverage in controllable sales and marketing costs.

General and Administrative Expenses

General and administrative expenses as a percentage of home closings revenue, net, decreased to 3.5% for the year ended December 31, 2025 compared to 4.0% for the prior year. The decrease was primarily due to a decrease in variable compensation-related expenses.

Net Income from Unconsolidated Entities

Net income from unconsolidated entities was $4.9 million and $6.3 million for the years ended December 31, 2025 and 2024, respectively. The decrease in net income from unconsolidated entities was primarily due to our joint venture relating to our Build-to-Rent operations which is still in the lease ramp-up phase. This decrease was partially offset by increases in income from our joint ventures related to our financial services segment.

Interest Expense, net

Interest expense, net was $47.0 million and $13.3 million for the years ended December 31, 2025 and 2024, respectively. The increase in interest expense, net was primarily due to an increase in the amount of non-capitalizable interest expense relating to our land banking arrangements as well as a decrease in interest income earned on our outstanding cash

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

balances. The number of communities financed via land banking arrangements increased by 48% year-over-year, driving the increase in expense.

Other Expense, net

Other expense, net for the years ended December 31, 2025 and 2024 was $37.7 million and $50.6 million, respectively. The year ended December 31, 2025 primarily consisted of $19.6 million in insurance losses and $14.8 million in pre-acquisition abandonment charges for projects we are no longer pursuing. The year ended December 31, 2024 included an aggregate of $23.7 million in legal charges, $21.3 million in insurance losses, and $9.5 million in pre-acquisition abandonment charges. Refer to Note 13 - Commitments and Contingencies in the Notes to Consolidated financial statements included in this Annual Report for additional discussion regarding the legal charges for the year ended December 31, 2024.

Loss on Extinguishment of Debt, net

Loss on extinguishment of debt, net for the year ended December 31, 2025 was $13.3 million. We recognized $12.2 million of loss as a result of our redemption of all of our 2027 5.875% Senior Notes (as defined herein) and the redemption of all of the 2027 6.625% Senior Notes (as defined herein). In addition, we recognized $1.1 million of loss relating to our amended Revolving Credit Facility, due to the write-off of prepaid unamortized debt issuance costs. We had no extinguishment of debt for the year ended December 31, 2024. Refer to “Liquidity and Capital Resources” and Note 7 - Debt in the Notes to the Consolidated Financial Statements included in this Annual Report for additional details regarding the purchase and redemptions.

Income Tax Provision

Our effective tax rate was 24.1% and 23.3% for the years ended December 31, 2025 and December 31, 2024, respectively. Our effective tax rate for both years was affected by state income taxes, non-deductible executive compensation, and excess tax benefits from stock-based compensation. Additionally, the effective tax rate in 2024 benefitted from certain energy tax credits related to homebuilding activities. We did not pursue energy credits in 2025 due to increasing costs to qualify which outweighed the benefits of obtaining such credits.

Net Income

Net income before allocation to non-controlling interests and diluted earnings per common share for the year ended December 31, 2025 were $791.3 million and $7.77, respectively. Net income before allocation to non-controlling interests and diluted earnings per common share for the year ended December 31, 2024 were $886.6 million and $8.27, respectively. The decreases in net income and diluted earnings per common share in the year ended December 31, 2025 compared to the prior year were primarily attributable to lower homebuilding gross margin, higher interest expense, and higher loss on extinguishment of debt, partially offset by lower general and administrative expenses, other expenses, and lower weighted average shares outstanding.

Liquidity and Capital Resources

Liquidity

We finance our operations through the following:

•Cash generated from operations;

•Borrowings under our Revolving Credit Facility;

•Various series of senior notes;

•Mortgage warehouse facilities;

•Project-level real estate financing (including non-recourse loans, land banking, and joint ventures); and

•Performance, payment and completion surety bonds, and letters of credit.

Cash flows for each of our communities depend on the status of the development cycle and can differ substantially from reported earnings. Early stages of development or expansion require significant cash expenditures for land acquisitions, on and off-site development, construction of homes, general landscaping and other amenities. Because these costs are a component of our inventory and are not recognized in our Consolidated statements of operations until a home closes, we incur significant cash outflows prior to recognition of earnings.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

During 2025, we (i) completed a cash tender offer (“Tender Offer”) to purchase approximately $479.2 million principal amount of the 5.875% Senior Notes due 2027 issued by TM Communities (a wholly owned subsidiary of the Company) (the "2027 5.875% Senior Notes") and redeemed the remaining $20.8 million principal amount of the 2027 5.875% Senior Notes and (ii)fully redeemed all $1.63 million principal amount of the 6.625% Senior Notes due 2027 issued by William Lyon Homes, Inc. (an indirect wholly owned subsidiary of the Company) (the "2027 6.625% WLH Notes") and $25.44 million principal amount of the 6.625% Senior Notes due 2027 issued by TM Communities (the "2027 6.625% TM Communities Notes," and together with the 2027 6.625% WLH Notes, the "2027 6.625% Senior Notes"), in each case, using net proceeds, together with cash on hand, from the issuance of $525.0 million aggregate principal amount of 5.75% Senior Notes due 2032 issued by TM Communities (the “2032 Senior Notes”). We also amended and restated our existing Revolving Credit Facility, resulting in a loss on extinguishment of debt due to the write-off of prepaid unamortized debt issuance costs. As a result of the redeemed senior notes and amended and restated Revolving Credit Facility, we recorded a net loss on extinguishment of debt of $13.3 million for the year ended December 31, 2025. Refer to Note 7 - Debt in the Notes to the Consolidated financial statements included in this Annual Report for additional details regarding the Tender Offer and redemptions.

The table below summarizes our total cash and liquidity as of the dates indicated (in thousands):

As of

We believe we have adequate capital resources from cash generated from operations and sufficient access to external financing sources from borrowings under our Revolving Credit Facility to conduct our operations for the next twelve months. Beyond the next twelve months, our primary demand for funds will be for payments of our long-term debt as it becomes due, land purchases, lot development, home and amenity construction, long-term capital investments, investments in our joint ventures, payments of ongoing operating expenses, and repurchases of common stock. We believe we will generate sufficient cash from our operations to meet the demands for such funds, however we may also access the capital markets to obtain additional liquidity through debt and equity offerings or refinance debt to secure capital for such long-term demands. As part of our operations, we may from time to time purchase our outstanding debt or equity through open market purchases, privately negotiated transactions or otherwise. Purchases or retirements of debt and/or purchases of equity, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions, and other factors. The amounts involved may be material.

Material Cash Requirements

We have various contractual obligations with commitments to pay third parties, including but not limited to our debt facilities, land purchase and land banking contracts, and leases. These obligations impact our liquidity and capital resource needs and are presented in the table below. Our short-term demands are cash requirements for the next twelve months and long-term demands are cash requirements beyond twelve months.

Cash Requirements

(Dollars in thousands) Totals Short-Term Demands Long-Term Demands

(1)Amount includes interest.

(2)Estimated interest expense amounts for debt outstanding at the respective contractual interest rates, the weighted average of which was 5.1% as of December 31, 2025.

In addition to our contractual obligations, we also have forecasted operational cash outlays on items such as future land purchases or common stock repurchases, to maintain our strategic growth and returns to our investors. Management expects to invest approximately $2.0 billion in land acquisition and development during the next twelve months which is

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

slightly lower than our spend during 2025. As of December 31, 2025 we had approximately $529.1 million remaining on our share repurchase authorization. On February 11, 2026, the Board of Directors authorized a renewal of the stock repurchase program, permitting repurchases up to $1.0 billion. This program expires on December 31, 2027 and replaces the prior authorization.

Cash Flow Activities

Operating Cash Flow Activities

Our net cash provided by operating activities was $817.3 million for the year ended December 31, 2025 compared to $210.1 million for the year ended December 31, 2024. The increase in net cash provided by operating activities was primarily attributable to a decrease in spend on real estate inventory and land deposits. Spending also decreased in 2025 as a result of our increased vigilance in underwriting and approving new transactions and additional phases of communities in the current market.

Investing Cash Flow Activities

Net cash used in investing activities was $154.8 million for the year ended December 31, 2025 compared to $136.4 million for the year ended December 31, 2024. The increase in cash used in investing activities was primarily due to an increase in purchases of fixed-maturity and equity securities, partially offset by a decrease in investments of capital into unconsolidated entities.

Financing Cash Flow Activities

Net cash used in financing activities was $298.5 million for the year ended December 31, 2025 compared to $393.6 million for the year ended December 31, 2024. The decrease in cash used in financing activities was primarily due to a net increase in loans payable and other borrowings as well as the proceeds from the issuance of senior notes which were partially offset by repayments on senior notes. Refer to Note 7 - Debt in the Notes to the Consolidated financial statements included in this Annual Report for additional details regarding the issuance of the 2032 Senior Notes and redemption of the 2027 6.625% Senior Notes and 2027 5.875% Senior Notes.

Debt Instruments

For information regarding our debt instruments, including the terms governing our senior notes and our Revolving Credit Facility, see Note 7—Debt in the Notes to the Consolidated financial statements included in this Annual Report.

Financial Guarantees

The following table summarizes our letters of credit and surety bonds as of the dates indicated:

As of December 31,

Total outstanding letters of credit and surety bonds $ 1,527,053 $ 1,408,156

(1)As of December 31, 2025 and 2024, there was $200.0 million total capacity of letters of credit available under our Revolving Credit Facility.

Off-Balance Sheet Arrangements as of December 31, 2025

Investments in Land Development and Homebuilding Joint Ventures or Unconsolidated Entities

We participate in strategic land development and homebuilding joint ventures with related and unrelated third parties. Our participation with these entities, in some instances, enables us to acquire land to which we could not otherwise obtain access, or could not obtain access on terms that are as favorable. Our partners in these joint ventures historically have been land owners/developers, other homebuilders and financial or strategic partners. Joint ventures with land owners/developers have given us access to sites owned or controlled by our partners. Joint ventures with other homebuilders have provided us with the ability to bid jointly with our partners for large or expensive land parcels. Joint ventures with financial or strategic partners have allowed us to combine our homebuilding expertise with access to our partners’ capital.

For the years ended December 31, 2025 and 2024, total cash contributed to unconsolidated joint ventures was $85.6 million and $129.8 million, respectively.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

The following is a summary of investments in unconsolidated joint ventures:

As of December 31,

Land Option Contracts and Land Banking Agreements

We are subject to the usual obligations associated with entering into contracts (including land option contracts and land banking arrangements) for the purchase, development, and sale of real estate in our routine business. We have a number of land purchase option contracts and land banking agreements, generally through cash deposits, for the right to purchase land or lots at a future point in time with predetermined terms. We do not have title to the property and the property owners and their creditors generally have no recourse to the Company. Our exposure with respect to such contracts is generally limited to the forfeiture of the related non-refundable cash deposits. The aggregate purchase price for assets under these contracts was $3.4 billion at December 31, 2025 and $1.9 billion at December 31, 2024.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 7A |QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 7A | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Our operations are interest rate sensitive. We monitor our exposure to changes in interest rates and incur both fixed rate and variable rate debt. At December 31, 2025, approximately 96% of our debt was fixed rate and 4% was variable rate. None of our market sensitive instruments were entered into for trading purposes. For fixed rate debt, changes in interest rates generally affect the fair value of the debt instrument, but not our earnings or cash flows. Conversely, for variable rate debt, changes in interest rates generally do not impact the fair value of the debt instrument but may affect our future earnings and cash flows, and may also impact our variable rate borrowing costs, which principally relate to any borrowings under our Revolving Credit Facility and to borrowings by TMHF under its various warehouse facilities. As of December 31, 2025, we had no outstanding borrowings under our Revolving Credit Facility. As of December 31, 2025, we had approximately $927.9 million of additional availability for borrowings under such facility including $127.9 million of additional availability for letters of credit (giving effect to $72.1 million of letters of credit outstanding as of such date).

The agreements governing our mortgage warehouse facilities as well as our Revolving Credit Facility use SOFR as the basis for determining interest rates. Given the limited history of this rate and potential volatility as compared to other benchmark or market rates, the future performance of this rate cannot be predicted based on historical performance.

We are required to offer to purchase all of our outstanding senior unsecured notes, as described in Note 7, Debt in the Notes to Consolidated financial statements included in this Annual Report, at 101% of their aggregate principal amount plus accrued and unpaid interest upon the occurrence of specified change of control events. Other than in those circumstances, we do not have an obligation to prepay fixed rate debt prior to maturity and, as a result, we would not expect interest rate risk and changes in fair value to have a significant impact on our cash flows related to our fixed rate debt until such time as we are required to refinance, repurchase or repay such debt.

The following table sets forth principal payments by scheduled maturity and effective weighted average interest rates and estimated fair value of our debt obligations as of December 31, 2025. The interest rate for our variable rate debt represents the interest rate on our mortgage warehouse facilities. Because the mortgage warehouse facilities are secured by certain mortgage loans held for sale which are generally sold within 30 days of origination, its outstanding balance is included as a variable rate maturity in the most current period presented.

Expected Maturity Date

Variable Rate Debt(2) $ 82.6 $ — $ — $ — $ — $ — $ 82.6 $ 82.6

Weighted average interest rate 5.3 — — — — — 5.3 %

(1)Represents the coupon rate of interest on the full principal amount of the debt.

(2)Based upon the amount of variable rate debt at December 31, 2025, and holding the variable rate debt balance constant, each 1% increase in interest rates would increase the interest incurred by us by approximately $0.8 million per year.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

PageNumber

Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34) 52

Consolidated balance sheets 54

Consolidated statement of operations 55

Consolidated statement of comprehensive income 56

Consolidated statement of stockholders’ equity 57

Consolidated statement of cash flows 58

Notes to the Consolidated financial statements 59

Separate combined financial statements of our unconsolidated joint venture investments have been omitted because, if considered in the aggregate, they would not constitute a significant subsidiary as defined by Rule 3-09 of Regulation S-X.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of Taylor Morrison Home Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Taylor Morrison Home Corporation and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 18, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Owned inventory valuation for active selling communities — Refer to Notes 2 and 4 to the financial statements

Critical Audit Matter Description

Owned inventory consists of land, land under development, homes under construction, completed homes and model homes, all of which are stated at cost. Management evaluates its owned inventory for indicators of impairment by community during each reporting period. If indicators of impairment are present for an active selling community, management first performs an undiscounted cash flow analysis to determine if a fair value analysis is required to be performed. The Company’s undiscounted cash flow analysis includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. Changes in these expectations may lead to a change in the outcome of the Company’s impairment analysis, and actual results may also differ from management’s assumptions.

Given the subjectivity in determining whether further impairment analysis is required for an active selling community, management exercises significant judgment when reviewing the indicators of impairment and the undiscounted cash flow

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

analyses, as applicable. Accordingly, auditing management’s judgments regarding the identification of impairment indicators and the key assumptions used in the undiscounted cash flow analyses involved especially subjective auditor judgment.

How the Critical Audit Matter Was Addressed in the Audit

We tested the operating effectiveness of controls over management’s impairment indicator analysis, including controls over key inputs into the analysis such as management’s forecast, and controls over management’s review of any undiscounted cash flows analyses for active selling communities identified with impairment indicators.

We evaluated the reasonableness of management’s impairment indicator analysis by evaluating management's process for identifying impairment indicators, including thresholds used for investigation, and whether management appropriately considered key relevant indicators. We also conducted an independent analysis to determine whether additional factors were present during the period that may indicate that a fair value analysis is required to be performed. Additionally, to evaluate management’s ability to develop estimates, we compared actual results for homes closed in the current year to prior projections for these same homes before closing and investigated variances.

If applicable, we evaluated the reasonableness of the key projections and estimates used in management’s undiscounted cash flow analyses by comparing the assumptions to recent home sales and closings. For any active selling communities without recent home sales and closings information available, we compared management’s estimates to historical estimates for similar communities, taking into consideration factors such as location, size, and type of community. We also inquired with management regarding trends and changing market conditions that were incorporated into management’s undiscounted cash flow projections in addition to consulting third-party analyst reports and projections that could identify factors that could affect an active selling community’s recoverability.

/s/ DELOITTE & TOUCHE LLP

Tempe, Arizona

February 18, 2026

We have served as the Company’s auditor since 2011.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except share amounts)

December 31,

Assets

Real estate inventory:

Liabilities

Estimated development liabilities 4,365 4,365

Revolving credit facility borrowings — —

Liabilities attributable to consolidated real estate not owned 94,195 71,195

COMMITMENTS AND CONTINGENCIES (Note 13)

Stockholders’ equity

Accumulated other comprehensive income 2,597 2,509

See accompanying Notes to the Consolidated financial statements

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

Years Ended December 31,

Net income from unconsolidated entities (4,867) (6,347) (8,757)

Loss on extinguishment of debt, net 13,324 — 295

Net income attributable to non-controlling interests (8,763) (3,261) (812)

Earnings per common share

Weighted average number of shares of common stock:

See accompanying Notes to the Consolidated financial statements

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

Years Ended December 31,

Post-retirement benefits adjustments, net of tax 88 1,613 537

See accompanying Notes to the Consolidated financial statements

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands, except share data)

Common Stock Additional Paid-In Capital Treasury Stock Stockholders’ Equity

Other comprehensive income — — — — — — 537 — 537

Stock compensation expense — — 26,095 — — — — — 26,095

Other comprehensive income — — — — — — 1,613 — 1,613

Stock compensation expense — — 22,461 — — — — — 22,461

Other comprehensive income — — — — — — 88 — 88

Stock compensation expense — — 29,049 — — — — — 29,049

(1)Dollar amount includes $26.4 million of stock options exercised offset with the value of shares withheld for taxes on the issuance of restricted stock units which equates to $9.4 million

(2)Dollar amount includes $10.7 million of stock options exercised offset with the value of shares withheld for taxes on the issuance of restricted stock units which equates to $15.4 million

(3) Dollar amount includes $200.0 million of Accelerated Share Repurchases and $3.5 million for the 1% excise tax on share repurchases

(4)Dollar amount includes $10.5 million of stock options exercised offset with the value of shares withheld for taxes on the issuance of restricted stock units which equates to $11.0 million

(5) Dollar amount includes $100.0 million of Accelerated Share Repurchases and $3.3 million for the 1% excise tax on share repurchases

See accompanying Notes to the Consolidated financial statements

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Years Ended December 31,

Cash Flows from Operating Activities

Net income from unconsolidated entities (4,867) (6,347) (8,757)

Loss on extinguishment of debt, net 13,324 — 295

Distributions of earnings from unconsolidated entities 12,789 12,929 9,230

Estimated development liability change in estimate — (23,051) (14,829)

Change in Build-to-Rent/Urban Form assets due to sale 67,247 79,976 —

Changes in operating assets and liabilities:

Cash Flows from Investing Activities:

Distributions of capital from unconsolidated entities 30,401 29,698 824

Purchase of fixed-maturity securities (55,738) — —

Proceeds from sale and maturities of fixed-maturity securities 1,385 — —

Purchase of equity securities (4,870) — —

Cash Flows from Financing Activities

Increase in loans payable and other borrowings 198,640 — 7,103

Repayments on loans payable and other borrowings (1,250) (52,093) (20,747)

Repayments on revolving credit facilities (240,000) (100,000) —

Proceeds from issuance of senior notes 525,000 — —

Payment of deferred financing costs (15,621) — —

Payment of principal portion of finance lease (1,385) (1,404) (1,316)

Supplemental Cash Flow Information

Supplemental Non-Cash Investing and Financing Activities:

Change in consolidated real estate not owned $ 23,000 $ (423) $ 47,647

Non-cash portion of loss on debt extinguishment $ 1,860 $ — $ —

Accrual of excise tax on share repurchases $ (3,341) $ (3,476) $ —

See accompanying Notes to the Consolidated financial statements

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TAYLOR MORRISON HOME CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1. BUSINESS

Description of the Business — Taylor Morrison Home Corporation (“TMHC”), through its subsidiaries (together with TMHC referred to herein as “we,” “our,” “the Company” and “us”), owns and operates a residential homebuilding business and is a land developer. We operate in the states of Arizona, California, Colorado, Florida, Georgia, Indiana, Nevada, North and South Carolina, Oregon, Texas, and Washington. We provide a collection of homes across a wide range of price points to appeal to a variety of consumer groups. We design, build and sell single and multi-family detached and attached homes in traditionally high growth markets for entry-level, move-up, and resort lifestyle buyers. We are the general contractors for all real estate projects and engage subcontractors for home construction and land development. Our homebuilding segments operate under the Taylor Morrison and Esplanade brand names. We also have a “Build-to-Rent” homebuilding business which operates under the Yardly brand name. We also provide financial services to customers through our wholly owned subsidiaries including mortgage services through Taylor Morrison Home Funding (“TMHF”), title and escrow services through Inspired Title, and homeowner’s insurance policies through Taylor Morrison Insurance Services (“TMIS”). Our business is organized into multiple homebuilding operating components, and a financial services component, all of which are managed as four reportable segments: East, Central, West, and Financial Services.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Consolidation — The accompanying audited Consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States ("GAAP"), include the accounts of TMHC and its consolidated subsidiaries as well as certain consolidated joint ventures. Intercompany balances and transactions have been eliminated in consolidation.

Joint Ventures - We consolidate certain joint ventures in accordance with Accounting Standards Codification (“ASC”) Topic 810, Consolidation. The income from the percentage of the joint venture not owned by us is presented as “Net income attributable to non-controlling interests” on the Consolidated statements of operations. The assets, liabilities and equity from the percentage of the joint ventures not owned by us is presented as “Non-controlling interests” on the Consolidated balance sheets and Consolidated statements of stockholders’ equity. The balance of Non-controlling interests on the Consolidated balance sheets will fluctuate from period to period as a result of activities within the respective joint ventures which may include the allocation of income or losses and distributions or contributions associated with the partners within the joint venture.

Use of Estimates — The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the amounts reported in the audited Consolidated financial statements and accompanying notes. Significant estimates include real estate development costs to complete, valuation of real estate, valuation of goodwill, valuation of estimated development liabilities, valuation of equity awards, valuation allowance on deferred tax assets, and reserves for warranty and self-insured risks. Actual results could differ from those estimates.

Concentration of Credit Risk — Financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents and mortgage loans held for sale. Cash and cash equivalents include amounts on deposit with financial institutions in the U.S. that are in excess of the Federal Deposit Insurance Corporation federally insured limits of up to $250,000. Of the different types of mortgage loans held for sale, there was no concentration of mortgage loans with any one borrower for the year ended December 31, 2025. No material losses have been experienced to date.

In addition, the Company is exposed to credit risk to the extent that mortgage loan borrowers fail to meet their contractual obligations. This risk is mitigated by collateralizing the home sold with a mortgage, and entering into forward commitments to sell our mortgage loans held for sale, generally within 30 days of origination.

Cash and Cash Equivalents — Cash and cash equivalents consist of cash on hand, demand and escrow deposits with financial institutions, and investments with original maturities of 90 days or less. At December 31, 2025, the majority of our cash and cash equivalents were invested in highly liquid money market funds or cash on deposit with major financial institutions.

Restricted Cash — For the year ended December 31, 2025 restricted cash consisted of cash held under broker margin accounts associated with derivative instruments.

Real Estate Inventory — Inventory consists of raw land, land under development, homes under construction, completed homes, and model homes, all of which are stated at cost. In addition to direct carrying costs, we also capitalize interest, real estate taxes, and related development costs that benefit an entire community, such as field construction supervision and related direct overhead. Home vertical construction costs are accumulated and charged to Cost of home closings at the time of home closings when revenue is recognized using the specific identification method. Land acquisition, development,

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

interest, and real estate taxes are capitalized and allocated generally using the relative sales value method. Generally, all overhead costs relating to purchasing, vertical construction, and construction utilities are considered overhead costs and allocated on a per unit basis. These costs are capitalized to inventory beginning with the start of development through construction completion. Changes in estimated costs to be incurred in a community are generally allocated to the remaining project on a prospective basis.

The life cycle of a community typically ranges from two to five years, commencing with the acquisition of unentitled or entitled land, continuing through the land development phase and concluding with the sale, construction and delivery of homes. Actual community duration will vary based on the size of the community, the sales absorption rate and whether we purchased the property as raw land or finished lots.

We assess the recoverability of our inventory in accordance with the provisions of ASC Topic 360, Property, Plant, and Equipment ("Topic 360"). We review our real estate inventory for indicators of impairment on a community-level basis during each reporting period. If indicators of impairment are present for a community, an undiscounted cash flow analysis is generally prepared in order to determine if the carrying value of the assets in that community exceeds the estimated undiscounted cash flows. Generally, if the carrying value of the assets exceeds their estimated undiscounted cash flows, the assets are potentially impaired, requiring a fair value analysis. Our determination of fair value is primarily based on a discounted cash flow model which includes projections and estimates relating to sales prices, construction costs, sales pace, and other factors. However, in certain circumstances, fair value can also be determined through other methods, such as appraisals, contractual purchase offers, and other third-party opinions of value. Changes in these expectations may lead to a change in the outcome of our impairment analysis, and actual results may also differ from our assumptions. For the year ended December 31, 2025 we recorded $28.8 million of inventory impairments relating to our East and West segments. For the year ended December 31, 2024 we recorded $5.0 million of inventory impairments relating to our East and Central segments. For the year ended December 31, 2023 we recorded $11.8 million of impairment charges relating to our West segment. Impairment charges relating to real estate inventory are recorded to Cost of home closings on the Consolidated statements of operations. In addition to real estate inventory, we also review our other real estate assets for impairment. For the year ended December 31, 2024 we recorded $12.5 million of real estate asset impairment relating to one Urban Form asset in our Corporate segment. For the years ended December 31, 2025 and December 31, 2023 there were no asset impairment charges relating to our Urban Form operations. Impairment charges relating to Urban Form assets are recorded to Amenity and other expenses on the Consolidated statement of operations.

In certain cases, we may elect to cease development and/or marketing of an existing community if we believe the economic performance of the community would be maximized by deferring development for a period of time to allow for market conditions to improve. We refer to such communities as long-term strategic assets. The decision may be based on financial and/or operational metrics as determined by us. For those communities that have been temporarily closed or development has been discontinued, we do not allocate or capitalize interest or other costs to the community’s inventory until activity resumes and such costs are expensed as incurred. In addition, if we cease development, we will evaluate the project for recoverability and discontinue future development and marketing activity until such time when we believe that market conditions have improved and positive economic performance can be achieved. Our assessment of the carrying value of our long-term strategic assets typically includes estimates of future performance, including the timing of when development will recommence, the type of product to be offered, and the margin to be realized.

Assets Held for Sale - Real estate or inventory assets are considered held for sale once it is determined that all six criteria in accordance with Topic360 have been met. Real estate and inventory assets held for sale are reported at the lower of carrying value or estimated fair value, less estimated costs to sell. The estimated fair value is generally based on appraisal, sales listing agreements, purchase and sales agreements, letters of intent, broker price opinions, recent offers received, prices for assets in recent comparable sales transactions, other third-party estimates, or cash flow analyses, depending on the type of asset. Impairment losses on real estate or inventory assets held for sale is recognized when the carrying value is greater than the fair value less estimated costs to sell.

In some locations where we act as a developer, we occasionally purchase land that includes commercially zoned parcels or areas designated for school or government use, which we typically sell to commercial developers or municipalities, as applicable. We also sell residential lots or land parcels to manage our land and lot supply on larger tracts of land. For the year ended December 31, 2024, we recorded $6.8 million of fair value adjustments for land held for sale in our West reporting segment, which was subsequently sold during 2025. Adjustments for land held for sale are recorded within Cost of land closings on the Consolidated statements of operations.

As of December 31, 2024, Amenity and other expenses on the Consolidated statements of operations included an adjustment to fair value for $5.3 million for one Urban Form asset which was classified as held for sale, but was subsequently determined by management that the sale of the asset was no longer probable within the one year requirement. As a result, we reclassified the Urban Form asset from held for sale to held and used during the fourth quarter of 2025. The asset was remeasured at the lower of (1) its carrying amount adjusted for depreciation that would have been recognized had the asset been continuously classified as held and used, and (2) its fair value at the reclassification date. The Urban Form Asset was reclassified with a net carrying value of $86.2 million.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

For the years ended December 31, 2025 and 2023 we had no material fair value adjustments for land held for sale.

Land banking arrangements — As a method of acquiring land in staged takedowns, while limiting risk and minimizing the use of funds from our available cash or other financing sources, we transfer our right under certain specific performance agreements to entities owned by third parties (“land banking arrangements”). These entities use equity contributions from their owners and/or incur debt to finance the acquisition and development of the land. We incur interest expense and fees on these arrangements. We capitalize qualifying interest costs to inventory during the development and construction periods with the remainder expensed and included in Interest expense/(income), net on the Consolidated statements of operations. These lots are considered controlled, however we are not legally obligated to purchase lots under these agreements and would forfeit any existing deposits and could be subject to financial and other penalties if the lots are not purchased. We do not have an ownership interest in these entities or title to their assets and do not guarantee their liabilities. As such, these entities are not consolidated. These land banking arrangements help us manage the financial and market risk associated with land holdings which are not included in the Consolidated balance sheets.

A summary of land banking agreements related to our home building operations is as follows:

As of December 31,

Lots under land banking agreements 8,498 6,895

During the year ended December 31, 2025, we entered into a new land banking arrangement related to our Build-to-Rent operations. This land banking agreement is similar to our other land banking arrangements, however the land seller for our Build-to-Rent land banking agreement finances both construction and land development.

A summary of land banking agreements related to our Build-to-Rent operations is as follows:

We did not have any land banking agreements for Build-to-Rent as of December 31, 2024.

As of December 31,

(Dollars in millions) 2025

Build-to-Rent lots under land banking agreements 4,325

Build-to-Rent aggregate purchase price $935.2

Build-to-Rent exposure to loss $43.6

Land Deposits — We make deposits related to land option contracts, land banking and land purchase contracts, which are recorded to Land deposits on the consolidated balance sheets. Land deposits are recorded as real estate inventory in the accompanying Consolidated balance sheets at the time the deposit is applied to the acquisition price of the land based on the terms of the underlying agreements. To the extent the deposits are non-refundable, they are charged to Other expense, net, if the land acquisition process is terminated or no longer determined probable. For the years ended December 31, 2025 and 2024, $7.3 million and $5.4 million of non-refundable deposits were charged to Other expense, net on the Consolidated statements of operations, respectively.

Mortgage Loans Held for Sale — Mortgage loans held for sale consist of mortgages due from buyers of Taylor Morrison homes that are financed through our wholly-owned mortgage finance subsidiary, TMHF. Mortgage loans held for sale are carried at fair value, using observable market information, including pricing from actual market transactions, investor commitment prices, or broker quotations. The fair value for Mortgage loans held for sale covered by investor commitments is generally based on commitment prices. The fair value for Mortgage loans held for sale not committed to be purchased by an investor is generally based on current delivery prices using best execution pricing.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Leases — We recognize leases in accordance with ASC Topic 842, Leases. Our operating leases primarily consist of office space, construction trailers, model home leasebacks, and equipment or storage units. Operating and finance leases are recorded in Lease right of use assets and Lease liabilities on the Consolidated balance sheets.

A summary of our leases is shown below:

Operating LeasesAs of December 31, Finance LeasesAs of December 31,

The future minimum lease payments required under our leases as of December 31, 2025 are as follows (dollars in thousands):

(1) Includes a 90-year land lease with 83 years remaining.

Prepaid Expenses and Other Assets, net — Prepaid expenses and other assets, net consist of the following:

As of December 31,

Total prepaid expenses and other assets, net $ 566,670 $ 370,642

Prepaid expenses consist primarily of sales commissions, prepaid rent, impact fees, and unamortized debt issuance costs for the Revolving Credit Facility. Prepaid sales commissions are recorded on pre-closing sales activities, which are recognized on the ultimate closing of the homes to which they relate. Other assets consist primarily of various operating and escrow deposits, land/lot pre-acquisition costs, rebate receivables, investments, income tax receivables, Urban Form assets, and other deferred costs. Build-to-Rent assets consist primarily of land and development costs relating to projects under construction.

The investments recorded in Other assets as of December 31, 2025 consist of equity securities and fixed-maturity securities. Such investments are reported at their estimated fair value with changes in fair value recognized as gains or losses within Other expense, net on the Consolidated statements of operations, pursuant to the fair value option for financial instruments guidance, ASC Topic 825-10, Financial Instruments. As of December 31, 2025, the value of such investments was $59.3 million and the net gain/loss on investment was immaterial to Consolidated statements of operations. We had no similar material investments as of December 31, 2024.

Derivative Assets— We enter into interest rate lock commitments (“IRLCs”) when originating residential Mortgage loans held for sale, at specified interest rates and within a specified period of time (generally between 30 and 60 days), with customers who have applied for a loan and meet certain credit and underwriting criteria. We are exposed to interest rate risk as a result of these IRLCs and originated Mortgage loans held for sale until those loans are sold in the secondary market.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The price risk related to changes in the fair value of IRLCs and Mortgage loans held for sale not committed to be purchased by investors are subject to change primarily due to changes in market interest rates. We manage the interest rate and price risk associated with our outstanding IRLCs and Mortgage loans held for sale not committed to be purchased by investors by entering into hedging instruments such as forward loan sales commitments and mandatory delivery commitments. We expect these instruments will experience changes in fair value inverse to changes in the fair value of the IRLCs and Mortgage loans held for sale not committed to investors, thereby reducing earnings volatility. Best effort sale commitments are also executed for certain loans at the time the IRLC is locked with the borrower. The fair value of the best effort IRLC and Mortgage loans held for sale are valued using the commitment price to the investor. We take into account various factors and strategies in determining what portion of the IRLCs and Mortgage loans held for sale to economically hedge.

The IRLCs meet the definition of a derivative and are reflected on the Consolidated balance sheets at fair value in Prepaid expenses and other assets, net or Accrued expenses and other liabilities based on whether the contracts are in a net gain (asset position) or net loss (liability position), with changes in fair value recognized in Financial Services revenue on the Consolidated statements of operations, in accordance with ASC Topic 815-25, Derivatives and Hedging. We do not meet the criteria for hedge accounting; therefore, we account for these instruments as free-standing derivatives, with changes in fair value recognized in Financial services revenue/expenses on the Consolidated statements of operations in the period in which they occur. Unrealized gains and losses on the IRLCs, reflected as derivative assets or liabilities, are measured based on the fair value of the underlying mortgage loan, quoted Agency MBS prices, estimates of the fair value of the mortgage servicing rights and the probability that the mortgage loan will fund within the terms of the IRLC, net of commission expense and broker fees. The fair value of the forward loan sales commitment and mandatory delivery commitments being used to hedge the IRLCs and Mortgage loans held for sale not committed to be purchased by investors are based on quoted Agency MBS prices. Refer to Note 14—Mortgage Hedging Activities for additional information.

Other Receivables, net— Other receivables primarily consist of amounts expected to be recovered from various community development, municipality, and utility districts and utility deposits. Allowances are maintained for potential losses based on historical experience, present economic conditions, and other factors considered relevant. Allowances are recorded in Other expense, net, when collectability becomes unlikely. Allowances at December 31, 2025 and 2024 were immaterial.

Investments in Consolidated and Unconsolidated Entities

Consolidated Entities — In the ordinary course of business, we enter into land purchase contracts, lot option contracts and land banking arrangements in order to procure land or lots for the construction of homes. Such contracts give us access to significant lot positions with a minimal initial capital investment and substantially reduce the risk associated with land ownership and development. In accordance with ASC Topic 810, Consolidation, when we enter into agreements to acquire land or lots and pay a non-refundable deposit, we evaluate if a Variable Interest Entity (“VIE”) is created and if we are deemed to have provided subordinated financial support that will absorb some or all of an entity’s expected losses, or rights to residual returns, if they occur. If we are the primary beneficiary of the VIE, we consolidate the VIE and reflect such assets and liabilities as Consolidated real estate not owned and Liabilities attributable to consolidated real estate not owned, respectively, on the Consolidated balance sheets.

Unconsolidated Joint Ventures — We use the equity method of accounting for entities, generally joint ventures with other builders, where we do not have a controlling interest over the operating and financial results of the investee. Our share of net earnings or losses is included in Net income from unconsolidated entities on the Consolidated statements of operations when earned and distributions are credited against our Investments in unconsolidated entities on the Consolidated balance sheets when received.

We evaluate our investments in unconsolidated entities for indicators of impairment semi-annually. A series of operating losses of an investee or other factors may indicate that a decrease in value of our investment in the unconsolidated entity has occurred which is other-than-temporary. The amount of impairment recognized, if any, is the excess of the investment’s carrying amount over its estimated fair value. Additionally, we consider various qualitative factors to determine if a decrease in the value of the investment is other-than-temporary. These factors include age of the venture, stage in its life cycle, intent and ability for us to recover our investment in the entity, financial condition and long-term prospects of the entity, short-term liquidity needs, trends in the general economic environment, entitlement status of the land, overall projected returns on investment, defaults under contracts with third parties (including bank debt), recoverability of the investment through future cash flows and relationships with the other partners. If we believe that the decline in the fair value of the investment is temporary, then no impairment is recorded. There were no impairment charges related to investments in unconsolidated entities for the years ended December 31, 2025, 2024, and 2023.

Income Taxes — We account for income taxes in accordance with ASC Topic 740, Income Taxes ("ASC 740"). Deferred tax assets and liabilities are recorded based on future tax consequences of temporary differences between the amounts reported for financial reporting purposes and the amounts deductible for income tax purposes, and are measured using enacted tax rates expected to apply in the years in which the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in earnings in the period when the changes are enacted.

We periodically assess our deferred tax assets, including the benefit from net operating losses, to determine if a valuation allowance is required. A valuation allowance is established when, based upon available evidence, it is more likely than not that all or a portion of the deferred tax assets will not be realized. Realization of the deferred tax assets is dependent upon,

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

among other matters, taxable income in prior years available for carryback, estimates of future income, tax planning strategies, and reversal of existing temporary differences.

Property and Equipment, net — Property and equipment are recorded at cost, less accumulated depreciation. Depreciation is generally computed using the straight-line basis over the estimated useful lives of the assets as follows:

Buildings: 20 – 40 years

Building and leasehold improvements: 10 years or remaining life of building/lease term if less than 10 years

Furniture, fixtures, and equipment: 5 years

IT equipment: 3 years

Model and sales office improvements: lesser of 3 years or the expected life of the community

Maintenance and repair costs are expensed as incurred.

Depreciation expense was $7.5 million, $11.5 million, and $9.0 million, respectively, for the years ended December 31, 2025, 2024, and 2023. Depreciation expense is recorded in General and administrative expenses in the Consolidated statement of operations.

Goodwill — The excess of the purchase price of a business acquisition over the net fair value of assets acquired and liabilities assumed is capitalized as Goodwill in accordance with ASC Topic 350, Intangibles — Goodwill and Other ("ASC 350"). ASC 350 requires that goodwill and intangible assets that do not have finite lives not be amortized, but rather assessed for impairment at least annually or more frequently if certain impairment indicators are present. We perform our annual impairment test during the fourth fiscal quarter or whenever impairment indicators are present. For the years ended December 31, 2025, 2024 and 2023, there were no indicators of impairment.

Insurance Costs — We have certain deductible limits for each of our policies under our workers’ compensation, automobile, and general liability insurance policies, and we record expense and liabilities for the estimated costs of potential claims for such policies. Excess liability exposure is aggregated annually and applied in excess of automobile liability, employer’s liability under workers compensation and general liability policies.

Self-Insurance Reserves — We are the parent of Beneva Indemnity Company (“Beneva”), a wholly-owned captive insurance company, which provides insurance coverage for construction defects discovered up to ten years following the close of a home, coverage for premise operations risk, and property damage. We accrue for the expected costs associated with the deductibles and self-insured amounts under our various insurance policies based on historical claims, estimates for claims incurred but not reported, and potential for recovery of costs from insurance and other sources. The estimates are subject to significant variability due to factors such as claim settlement patterns, litigation trends, and the extended period of time in which a construction defect claim might be made after the closing of a home. We also generally require our subcontractors and design professionals to indemnify us and provide evidence of insurance for liabilities arising from their work, subject to certain limitations. Our loss reserves for self-insured claims are based on factors that include an actuarial study for historical and anticipated claims, trends related to similar product types, number of home closings, and geographical areas. We regularly review the reasonableness and adequacy of our reserves and make adjustments to the balance of the preexisting reserves to reflect changes in trends and historical data as information becomes available. Self-insurance reserves are included in Accrued expenses and other liabilities on the Consolidated balance sheets.

Warranty Reserves —We offer a one year limited warranty to cover various defects in workmanship or materials, a two year limited warranty on certain systems (such as electrical or cooling systems), and a ten year limited warranty on structural defects. We also provide third-party warranty coverage on homes where required by Federal Housing Administration or Veterans Administration lenders. Warranty reserves are established as homes close in an amount estimated to be adequate to cover expected costs of materials and outside labor during warranty periods. Our warranty is not considered a separate performance obligation in the sales arrangement since it is not priced separately from the home, therefore, it is accounted for in accordance with ASC Topic 450, Contingencies, which states that warranties that are not separately priced are generally accounted for by accruing the estimated costs to fulfill the warranty obligation. As a result, we accrue the estimated costs to fulfill the warranty obligation at the time a home closes, as a component of Cost of home closings on the Consolidated statements of operations.

Employee Benefit Plans — We maintain a defined contribution plan pursuant to Section 401(k) of the Internal Revenue Code (“401(k) Plan”). Each eligible employee may elect to make before-tax contributions up to the current tax limits. At December 31, 2025, we match 100% of employees’ voluntary contributions up to 4% of eligible compensation, and 50% for each dollar contributed between 4% and 5% of eligible compensation. We contributed $15.3 million, $14.4 million, and $13.2 million to the 401(k) Plan for the years ended December 31, 2025, 2024, and 2023, respectively.

Treasury Stock — We account for treasury stock, including the shares repurchased as part of our Accelerated Share Repurchase ("ASR") programs, in accordance with ASC Topic 505-30, Equity—Treasury Stock. Repurchased shares are reflected as a reduction in Stockholders’ equity. Refer to Note 10 - Stockholders' Equity for additional discussion regarding ASR programs.

Stock Based Compensation — We have stock options, performance-based restricted stock units ("PRSUs") and non-performance-based restricted stock units ("RSUs" or "Restricted stock"), which we account for in accordance with ASC Topic

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

718-10, Compensation — Stock Compensation. The fair value for stock options is measured and estimated on the date of grant using the Black-Scholes option pricing model and recognized evenly over the vesting period of the options. PRSUs are measured using the closing price on the date of grant and expensed using a probability of attainment calculation which determines the likelihood of achieving the performance targets. RSUs are time-based awards and measured using the closing price on the date of grant and are expensed ratably over the vesting period.

Revenue Recognition — Revenue is recognized in accordance with ASC Topic 606, Revenue from Contracts with Customers (“Topic 606”). The standard’s core principle requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services.

Home and land closings revenue

Under Topic 606, the following steps are applied to determine home closings revenue and land closings revenue recognition:

(1) identify the contract(s) with our customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when (or as) the performance obligation(s) are satisfied. Our home sales transactions have one contract, with one performance obligation, with each customer to build and deliver the home purchased (or develop and deliver land). Based on the application of the five steps, the following summarizes the timing and manner of home and land closings revenue:

•Revenue from land closings is recognized when a significant down payment is received, title passes and collectability of the receivable, if any, is probable, and control of the property transfers to the buyer, which is generally upon the close of escrow.

Amenity and other revenue

We own and operate certain amenities such as golf courses, club houses, and fitness centers, which require us to provide club members with access to the facilities in exchange for the payment of club dues. We collect club dues and other fees from club members, which are invoiced and recorded as revenue on a monthly basis. Revenue from our golf club operations is also included in Amenity and other revenue. Amenity and other revenue also includes revenue from the sale of assets from our Urban Form operations and Build-to-Rent operations which is recorded as control transfers to the buyer at transaction close and other criteria of ASC 606 are met. In addition, lease revenue is recognized by Urban Form for commercial and residential leases and Build-to-Rent operations for the rental home leases.

During the year ended December 31, 2025, we sold one Urban Form asset in California and one Build-to-Rent asset in Phoenix, generating $22.8 million and $55.2 million of revenue, respectively, which was recorded in Amenity and other revenue on the Consolidated statements of operations within our Corporate and Unallocated operating and reporting segment. The sale of these assets resulted in $0.9 million and $9.9 million of gross margin for Urban Form and Build-to-Rent, respectively. For the year ended December 31, 2024, we sold two Build-to-Rent projects for an aggregate of $88.4 million in revenue and $6.1 million of gross margin.

Financial services revenue

Mortgage operations and hedging activity related to financial services are not within the scope of Topic 606. Loan origination fees (including title fees, points, and closing costs) are recognized at the time the related real estate transactions are completed, which is usually upon the close of escrow. Generally, loans TMHF originates are sold to third-party investors within a short period of time, on a non-recourse basis. Gains and losses from the sale of mortgages are recognized in accordance with ASC Topic 860-20, Sales of Financial Assets. TMHF does not have continuing involvement with the transferred assets; therefore, we derecognize the mortgage loans at time of sale, based on the difference between the selling price and carrying value of the related loans upon sale, recording a gain/loss on sale in the period of sale. Also included in Financial services revenue/expenses is the realized and unrealized gains and losses from hedging instruments. See "Prepaid Expenses and Other Assets, net — Derivative Assets" above.

Advertising Costs — We expense advertising costs as incurred. For the years ended December 31, 2025, 2024, and 2023, advertising costs were $40.7 million, $33.8 million, and $28.7 million, respectively. Such costs are included in Sales, commissions and other marketing costs on the Consolidated statements of operations.

Recently Issued Accounting Pronouncements — In November 2024, the Financial Accounting Standards Board ("FASB") issued Accounting Standard Update ("ASU") 2024-03, Disaggregation of Income Statement Expenses, which establishes new disclosure requirements for income statement expenses. Under the new guidance, entities must provide greater disaggregation of expenses which includes disclosing the amounts of purchases of inventory, employee compensation, and

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

depreciation included in each relevant expense caption. Entities will also have to disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, the total amount of selling expenses, and a definition of selling expenses. ASU 2024-03 can be applied prospectively or retrospectively and is effective for the annual reporting period ending December 31, 2027. The adoption of ASU 2024-03 will not impact our Consolidated financial statements but we are currently reviewing the impact that it may have on our footnote disclosures.

In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-Use Software, which establishes new guidance regarding timing of capitalizing software costs. Under the new guidance, entities are required to start capitalizing software costs when (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended. ASU 2025-06 can be applied prospectively or retrospectively and is effective for annual and reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. We are currently reviewing the impact the adoption of ASU 2025-06 will have on our consolidated financial statements or disclosures, however we do not expect it to have a material impact.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which lists the disclosures required under ASC 270 and establishes a disclosure principal. The disclosure principal requires entities issuing condensed statements to disclose events occurring since the end of the most recent fiscal year that have a material impact on the entity. ASU 2025-11 can be applied prospectively or retrospectively and is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. We are currently reviewing the impact the adoption of ASU 2025-11 will have on our consolidated financial statements or disclosures, however we do not expect it to have a material impact.

3. EARNINGS PER SHARE

Basic earnings per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share gives effect to the potential dilution that could occur if all outstanding dilutive equity awards to issue shares of common stock were exercised or settled.

The following is a summary of the components of basic and diluted earnings per share:

Year Ended December 31,

Numerator:

Denominator:

Earnings per common share – basic $ 7.90 $ 8.43 $ 7.09

Earnings per common share – diluted $ 7.77 $ 8.27 $ 6.98

The above calculations of weighted average shares exclude 230,870, 120,255, and 303,033 outstanding anti-dilutive stock options and unvested PRSUs and RSUs for the years ended December 31, 2025, 2024, and 2023, respectively.

In addition, 336,935 and 176,725 shares relating to our ASR (refer to Note 10 - Stockholders' Equity) were also anti-dilutive and excluded from the above for the year ended December 31, 2025 and December 31, 2024, respectively. There were no ASR transactions in 2023.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

4. REAL ESTATE INVENTORY

Inventory consists of the following:

As of December 31,

Real estate held for development or held for sale (1) 8,975 26,301

(1)Real estate held for development or held for sale includes properties which are not in active production.

(2)Operating communities consist of all vertical construction costs relating to homes in progress and completed homes.

We have land option purchase contracts, land banking arrangements and other controlled lot agreements. We do not have title to the assets, and the sellers and their creditors generally only have recourse against us in the form of retaining non-refundable deposits. We are also not legally obligated to purchase the lots except where we have specific performance obligations.

A summary of owned and controlled lots is as follows:

As of December 31,

Owned lots:

Controlled lots:

Land option purchase contracts 8,632 9,529

(1)Other controlled lots include single transaction take-downs and lots from our portion of unconsolidated JVs.

Lots which represent homes in progress and completed homes have been excluded from total owned lots. Controlled lots represent lots in which we have a contractual right to acquire real estate, generally through an option contract, land banking arrangement, or a land deposit paid to a seller. Homes in inventory include any lots which have commenced vertical construction.

Capitalized Interest — Interest capitalized, incurred and amortized is as follows:

Year ended December 31,

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

5. INVESTMENTS IN CONSOLIDATED AND UNCONSOLIDATED ENTITIES

Unconsolidated Entities — We have investments in a number of joint ventures with third parties. These entities are generally involved in real estate development, homebuilding, Build-to-Rent, and/or mortgage lending activities. The primary activity of our real estate development joint ventures is the development and sale of lots to joint venture partners and/or unrelated builders.

Summarized, unaudited condensed combined financial information of unconsolidated entities that are accounted for by the equity method are as follows (in thousands):

As of December 31,

Assets:

Liabilities:

Owners’ equity:

Years ended December 31,

TMHC’s share in net income of unconsolidated entities $ 4,867 $ 6,347 $ 8,757

Distributions to TMHC from unconsolidated entities $ 43,190 $ 42,627 $ 10,054

Consolidated Entities — We have several joint ventures for the purpose of real estate development and homebuilding activities, which are VIEs. As the managing member, we oversee the daily operations and have the power to direct the activities of these joint ventures. For this specific subset of joint ventures, based upon the allocation of income and loss per the applicable joint venture agreements and certain performance guarantees, we have potentially significant exposure to the risks and rewards of these joint ventures. Therefore, we are the primary beneficiary of these joint venture VIEs, and the entities are consolidated.

Assets and liabilities of the consolidated joint ventures consist of the following (in thousands):

Years ended December 31,

Total assets of consolidated joint ventures $ 112,041 $ 98,659

Liabilities of consolidated joint ventures(1) $ 51,762 $ 48,488

(1) Liabilities of consolidated joint ventures is primarily comprised of accounts payable and accrued expenses and other liabilities.

TAYLOR MORRISON HOME CORPORATION 10-K

Table of Contents

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TMHC US Equity

TMHC · 10-K · period ended 2025-12-31

ITEM 7 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A |QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TMHC US Equity☆

TMHC · 10-K · period ended 2025-12-31

ITEM 7 | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 7A |QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 8 | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

TMHC US Equity