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Income Taxes (Tables)

12 Months Ended

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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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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