XML 34 R17.htm IDEA: XBRL DOCUMENT
v3.20.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | NOTE 10 Income Taxes On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act of 2017 (the “Tax Reform Act”). The Tax Reform Act makes changes to the U.S. tax code that affected our income tax rate in 2017. The Tax Reform Act reduces the U.S. federal corporate income tax rate from 35.0% to 21.0% and requires companies to pay a one-time transition tax on certain unrepatriated earnings from foreign subsidiaries. The Tax Reform Act also establishes new tax laws that became effective January 1, 2018. ASC 740 requires a company to record the effects of a tax law change in the period of enactment, however, shortly after the enactment of the Tax Reform Act, the SEC staff issued SAB 118, which allows a company to record a provisional amount when it does not have the necessary information available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law. The measurement period ends when the company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year. For 2017, we made a reasonable estimate of the impact of the Tax Reform Act and recorded a one-time credit in our 2017 income tax expense of $120.9 million, which reflects an estimated reduction in our deferred income tax liabilities of $124.2 million as a result of the maximum federal rate decreasing to 21.0% from 35.0%, which was partially offset by an estimated increase in income tax payable in the amount of $3.3 million as a result of the transition tax on cash and cash equivalent balances related to untaxed accumulated earnings associated with our international operations. During 2018, we made a credit adjustment to the transition tax on untaxed international operations in the amount of $1.6 million. This adjustment was a reduction of income tax expense for 2018 as a result of updated calculations based on the Company’s tax filings for the 2017 year end. As of December 31, 2020, management does not expect any further changes to the amounts previously recorded and adjusted under SAB 118. Significant components of the provision for income taxes for the years ended December 31 are as follows:
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 93,620 |  |  | $ | 85,507 |  |  | $ | 77,694 |
State |  |  | 34,123 |  |  |  | 28,905 |  |  |  | 25,096 |
Foreign |  |  | 325 |  |  |  | 620 |  |  |  | 409 |
Total current provision |  |  | 128,068 |  |  |  | 115,032 |  |  |  | 103,199 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 11,655 |  |  |  | 14,994 |  |  |  | 8,483 |
State |  |  | 4,119 |  |  |  | (2,587 | ) |  |  | 6,519 |
Foreign |  |  | (226 | ) |  |  | (24 | ) |  |  | 6 |
Total deferred provision |  |  | 15,548 |  |  |  | 12,383 |  |  |  | 15,008 |
Total tax provision |  | $ | 143,616 |  |  | $ | 127,415 |  |  | $ | 118,207 |
A reconciliation of the differences between the effective tax rate and the federal statutory tax rate for the years ended December 31 is as follows:
|  | 2020 |  |  | 2019 |  |  | 2018 |
Federal statutory tax rate |  |  | 21.0 | % |  |  | 21.0 | % |  |  | 21.0 | %
State income taxes, net of federal income tax benefit |  |  | 5.3 |  |  |  | 3.8 |  |  |  | 5.7 |
Non-deductible employee stock purchase plan expense |  |  | 0.3 |  |  |  | 0.3 |  |  |  | 0.2 |
Non-deductible meals and entertainment |  |  | 0.1 |  |  |  | 0.3 |  |  |  | 0.3 |
Non-deductible officers’ compensation |  |  | 0.3 |  |  |  | 0.2 |  |  |  | 0.3 |
Tax Reform Act deferred tax revaluation and transition tax impact |  |  | 0.0 |  |  |  | 0.0 |  |  |  | (0.3 | )
Stock Vesting under ASU 2016-19 |  |  | (3.5 | ) |  |  | (1.1 | ) |  |  | (1.4 | )
Other, net |  |  | (0.5 | ) |  |  | (0.3 | ) |  |  | (0.2 | )
Effective tax rate |  |  | 23.0 | % |  |  | 24.2 | % |  |  | 25.6 | %
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the corresponding amounts used for income tax reporting purposes. Significant components of the Company’s net deferred tax liabilities as of December 31 are as follows:
(in thousands) |  | 2020 |  |  | 2019 |
Non-current deferred tax liabilities: |  |  |  |  |  |  |  |
Intangible assets |  | $ | 400,335 |  |  | $ | 360,660 |
Fixed assets |  |  | 11,740 |  |  |  | 10,325 |
ASC 842 ROU Asset |  |  | 46,730 |  |  |  | 46,188 |
Impact of adoption of ASC 606 revenue recognition |  |  | 19,928 |  |  |  | 24,687 |
Net unrealized holding (loss)/gain on available-for-sale securities |  |  | 176 |  |  |  | 36 |
Total non-current deferred tax liabilities |  |  | 478,909 |  |  |  | 441,896 |
Non-current deferred tax assets: |  |  |  |  |  |  |  |
Deferred compensation |  |  | 59,897 |  |  |  | 52,566 |
Accruals and reserves |  |  | 19,497 |  |  |  | 7,743 |
ASC 842 lease liabilities |  |  | 53,150 |  |  |  | 52,185 |
Net operating loss carryforwards and 163(j) disallowed carryforwards |  |  | 3,168 |  |  |  | 2,377 |
Valuation allowance for deferred tax assets |  |  | (1,025 | ) |  |  | (1,252 | )
Total non-current deferred tax assets |  |  | 134,687 |  |  |  | 113,619 |
Net non-current deferred tax liability |  | $ | 344,222 |  |  | $ | 328,277 |
Income taxes paid in 2020, 2019 and 2018 were $132.9 million, $110.0 million and $110.6 million, respectively. At December 31, 2020, the Company had no net operating loss carryforwards for federal purposes and $36.0 million net operating loss carryforwards for state income tax reporting purposes, portions of which expire in the years 2021 through indefinite. The state carryforward amount is derived from the operating results of certain subsidiaries. As of December 31, 2020, the Company had a net operating loss carryforward in Canada of $6.4 million. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
(in thousands) |  | 2020 |  |  | 2019 |  |  | 2018 |
Unrecognized tax benefits balance at January 1 |  | $ | 1,127 |  |  | $ | 1,639 |  |  | $ | 1,694 |
Gross increases for tax positions of prior years |  |  | 848 |  |  |  | 778 |  |  |  | 594 |
Gross decreases for tax positions of prior years |  |  | (708 | ) |  |  | (791 | ) |  |  | (5 | )
Settlements |  |  | — |  |  |  | (499 | ) |  |  | (644 | )
Unrecognized tax benefits balance at December 31 |  | $ | 1,267 |  |  | $ | 1,127 |  |  | $ | 1,639 |
The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2020, 2019 and 2018 the Company had $0.3 million, $0.2 million and $0.2 million of accrued interest and penalties related to uncertain tax positions, respectively. The total amount of unrecognized tax benefits that would affect the Company’s effective tax rate if recognized was $1.3 million as of December 31, 2020, $1.1 million as of December 31, 2019 and $1.6 million as of December 31, 2018. The Company does not expect its unrecognized tax benefits to change significantly over the next 12 months. The Company is subject to taxation in the United States and various state jurisdictions. The Company is also subject to taxation in the United Kingdom and Canada. In the United States, federal returns for fiscal years 2016 through 2020 remain open and subject to examination by the Internal Revenue Service. The Company files and remits state income taxes in various states where the Company has determined it is required to file state income taxes. The Company’s filings with those states remain open for audit for the fiscal years 2016 through 2020. In the United Kingdom, the Company’s filings remain open for audit for the fiscal years 2019 and 2020. In Canada, the Company’s filings remain open for audit for the fiscal years 2016 through 2020. The Company also operates in Bermuda and the Cayman Islands. The Company is not subject to any income taxes in these countries. During 2018, the Company settled the previously disclosed State of Massachusetts income tax audit for the fiscal year 2013 through 2014. During 2019, the Company settled the previously disclosed State of Colorado income tax audit for the fiscal years 2013-2016, the State of Kansas income tax audit for the fiscal years 2014-2016, and the State of New York income tax audit for the fiscal years 2015-2017. The Company is currently under audit in the states of California, Illinois, Massachusetts and Wisconsin for the fiscal years 2015 through 2017. In addition, the Company is under audit in the state of Wisconsin for the fiscal year 2018. In general, it is our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in those operations. The Company has determined it is not practical to determine the unrecognized deferred tax liabilities on the undistributed earnings from the Company’s international subsidiaries as such earnings are considered to be indefinitely reinvested.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration