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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Components of Income (Loss) Before Income Taxes | The components of income before income taxes were as follows (in thousands):
| Year Ended December 31,
| 2022 |  | 2021 |  | 2020
Income before income taxes: |  |  |  |  |
Domestic | $ | 532,051 |  |  | $ | 534,302 |  |  | $ | 632,791 |
Foreign | 171,835 |  |  | 88,599 |  |  | (61,445) |
Total | $ | 703,886 |  |  | $ | 622,901 |  |  | $ | 571,346 |
Provision for Income Taxes | The components of the provision for income taxes were as follows (in thousands):
| Year Ended December 31,
| 2022 |  | 2021 |  | 2020
Current: |  |  |  |  |
Federal | $ | 97,673 |  |  | $ | 65,273 |  |  | $ | 134,538 |
State | 29,439 |  |  | 32,930 |  |  | 45,610 |
Foreign | 23,078 |  |  | 6,644 |  |  | (745) |
Total current tax provision | 150,190 |  |  | 104,847 |  |  | 179,403 |
Deferred: |  |  |  |  |
Federal | 29,657 |  |  | 27,762 |  |  | (46,251) |
State | 4,225 |  |  | (2,418) |  |  | (3,850) |
Foreign | 8,171 |  |  | 727 |  |  | (9,915) |
Total deferred tax provision (benefit) | 42,053 |  |  | 26,071 |  |  | (60,016) |
Total provision for income taxes | $ | 192,243 |  |  | $ | 130,918 |  |  | $ | 119,387 |
Effective Income Tax Rate Reconciliation | The actual income tax provision differed from the income tax provision computed by applying the U.S. federal statutory corporate rate to income before provision for income taxes as follows (in thousands):
| Year Ended December 31,
| 2022 |  | 2021 |  | 2020
Provision at the statutory rate | $ | 147,816 |  |  | $ | 130,809 |  |  | $ | 119,983 |
Increases (decreases) resulting from: |  |  |  |  |
State taxes | 28,320 |  |  | 27,204 |  |  | 31,791 |
Valuation allowance on deferred tax assets | 23,366 |  |  | 6,107 |  |  | (31,138) |
Tax contingency reserves, net | 7,939 |  |  | 844 |  |  | (2,125) |
Employee per diems, meals and entertainment | 6,086 |  |  | 3,569 |  |  | 10,680 |
Company-owned life insurance | 2,917 |  |  | (6,969) |  |  | — |
Foreign taxes | (638) |  |  | (9,359) |  |  | (7,268) |
Taxes on certain equity method investments and non-controlling interests | (12,886) |  |  | (8,825) |  |  | (3,466) |
Stock-based compensation | (24,066) |  |  | (21,271) |  |  | (3,109) |
Other | 13,389 |  |  | 8,809 |  |  | 4,039 |
Total provision for income taxes | $ | 192,243 |  |  | $ | 130,918 |  |  | $ | 119,387 |
Deferred Tax Assets and Liabilities and Net Deferred Income Tax Assets and Liabilities | The tax effects of these temporary differences, representing deferred tax assets and liabilities, result principally from the following (in thousands):
| December 31,
| 2022 |  | 2021
Deferred income tax liabilities: |  |  |
Property and equipment | $ | (286,950) |  |  | $ | (278,303) |
Goodwill | (129,491) |  |  | (93,632) |
Leased assets | (84,870) |  |  | (76,728) |
Retainage | (28,773) |  |  | (32,661) |
Total deferred income tax liabilities | (530,084) |  |  | (481,324) |
Deferred income tax assets: |  |  |
Lease liabilities | 84,189 |  |  | 76,608 |
Other intangible assets | 73,654 |  |  | 19,110 |
Net operating loss carryforwards | 56,556 |  |  | 78,947 |
Stock and incentive compensation | 55,413 |  |  | 50,772 |
Accruals and reserves | 48,168 |  |  | 66,000 |
Tax credits | 34,413 |  |  | 39,826 |
Deferred tax benefits on unrecognized tax positions | 8,899 |  |  | 10,090 |
Equity method investments and non-controlling interests | 5,878 |  |  | 273 |
Other | 5,849 |  |  | 7,114 |
Subtotal | 373,019 |  |  | 348,740 |
Valuation allowance | (58,461) |  |  | (41,308) |
Total deferred income tax assets | 314,558 |  |  | 307,432 |
Total net deferred income tax liabilities | $(215,526) |  | $(173,892)
The net deferred income tax assets and liabilities comprised the following in the accompanying consolidated balance sheets (in thousands):
| December 31,
| 2022 |  | 2021
Deferred income taxes: |  |  |
Assets | $ | 12,335 |  |  | $ | 17,206 |
Liabilities | (227,861) |  |  | (191,098) |
Total net deferred income tax liabilities | $ | (215,526) |  |  | $ | (173,892) |
Reconciliation of Unrecognized Tax Benefit | A reconciliation of unrecognized tax benefit balances is as follows (in thousands):
| December 31,
| 2022 |  | 2021 |  | 2020
Balance at beginning of year | $ | 37,737 |  |  | $ | 33,219 |  |  | $ | 40,878 |
Additions based on tax positions related to the current year | 11,699 |  |  | 6,881 |  |  | 4,398 |
Additions for tax positions of prior years | 230 |  |  | 2,339 |  |  | — |
Reductions for tax positions of prior years | (407) |  |  | — |  |  | (2,410) |
Reductions for audit settlements | (2,207) |  |  | — |  |  | (930) |
Reductions resulting from a lapse of the applicable statute of limitations periods | (5,413) |  |  | (4,702) |  |  | (8,717) |
Balance at end of year | $ | 41,639 |  |  | $ | 37,737 |  |  | $ | 33,219 |
Balances of Unrecognized Tax Benefits | The balances of unrecognized tax benefits, the amount of related interest and penalties and what Quanta believes to be the range of reasonably possible changes in the next 12 months are as follows (in thousands):
| December 31, 2022
Unrecognized tax benefits | $ | 41,639 |
Portion that, if recognized, would reduce tax expense and effective tax rate | 39,247 |
Accrued interest on unrecognized tax benefits | 4,334 |
Accrued penalties on unrecognized tax benefits | 1,085 |
Reasonably possible reduction to the balance of unrecognized tax benefits in succeeding 12 months | $0 to $12,122
Portion that, if recognized, would reduce tax expense and effective tax rate | $0 to $11,699

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- Definition Tabular disclosure for tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15A -URI https://asc.fasb.org/extlink&oid=121826272&loc=SL6600010-109319 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32718-109319 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 19 -URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32840-109319 + Details
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