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Income Taxes | 12 Months Ended
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Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The provision for income taxes consists of the following:
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  | 2021
Current: |  |  |  |  |  |
Federal |  | $ | 261,481 |  |  | $ | 412,036 |  |  | $ | 272,971 |
State |  | 79,023 |  |  | 126,686 |  |  | 80,650 |
Deferred: |  |  |  |  |  |
Federal |  | (3,986) |  |  | (6,753) |  |  | 873 |
State |  | 244 |  |  | (4,350) |  |  | (810) |
Income tax expense |  | $ | 336,762 |  |  | $ | 527,619 |  |  | $ | 353,684 |
Deferred income taxes on our consolidated balance sheets were comprised of the following:
|  | As of December 31,
|  | 2023 |  | 2022
Deferred tax assets: |  |  |  |
Other accrued expenses and contract land deposit reserve |  | $ | 71,466 |  |  | $ | 73,555 |
Deferred compensation |  | 4,347 |  |  | 4,728 |
Equity-based compensation expense |  | 48,088 |  |  | 47,605 |
Inventory |  | 18,181 |  |  | 13,981 |
Unrecognized tax benefit |  | 8,049 |  |  | 8,849 |
Other |  | 14,703 |  |  | 11,364 |
Total deferred tax assets |  | 164,834 |  |  | 160,082 |
Less: Deferred tax liabilities |  | 9,515 |  |  | 8,505 |
Net deferred tax asset |  | $ | 155,319 |  |  | $ | 151,577 |
Deferred tax assets arise principally as a result of various accruals required for financial reporting purposes and equity-based compensation expense, which are not currently deductible for tax return purposes. Deferred tax assets include $3,293 of Federal Alternative Minimum Tax Credits (CAMT) for the year ended December 31, 2023 that may be carried forward indefinitely. Management believes that we will have sufficient future taxable income to make it more likely than not that the net deferred tax assets will be realized. Federal taxable income is estimated to be approximately $1,302,200 for the year ended December 31, 2023, and was $2,001,717 for the year ended December 31, 2022. A reconciliation of income taxes computed at the federal statutory rate (21% in 2023, 2022, and 2021) to income tax expense is as follows:
|  | Year Ended December 31,
|  | 2023 |  | 2022 |  | 2021
Income taxes computed at the federal statutory rate |  | $ | 404,958 |  |  | $ | 473,171 |  |  | $ | 333,985 |
State income taxes, net of federal income tax benefit (1) |  | 92,163 |  |  | 105,867 |  |  | 72,082 |
Excess tax benefits from equity-based compensation |  | (153,554) |  |  | (50,324) |  |  | (48,369) |
Other, net (2) |  | (6,805) |  |  | (1,095) |  |  | (4,014) |
Income tax expense |  | $ | 336,762 |  |  | $ | 527,619 |  |  | $ | 353,684 |
(1)Excludes state excess tax benefits from equity-based compensation included in the line below. (2)Primarily attributable to tax benefits from certain energy credits for the years ended December 31, 2023, 2022 and 2021. Our effective tax rate in 2023, 2022 and 2021 was 17.46%, 23.42% and 22.24%, respectively. We file a consolidated U.S. federal income tax return, as well as state and local tax returns in all jurisdictions where we maintain operations. With few exceptions, we are no longer subject to income tax examinations by tax authorities for years prior to 2020. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
|  | Year Ended December 31,
|  | 2023 |  | 2022
Balance at beginning of year |  | $ | 29,526 |  |  | $ | 33,490 |
Additions based on tax positions related to the current year |  | 782 |  |  | 1,326 |
Reductions for tax positions of prior years |  | (4,720) |  |  | (5,290) |
Settlements |  | — |  |  | — |
Balance at end of year |  | $ | 25,588 |  |  | $ | 29,526 |
If recognized, the total amount of unrecognized tax benefits that would affect the effective tax rate (net of the federal tax benefit) is $20,215 as of December 31, 2023. We recognize interest related to unrecognized tax benefits as a component of income tax expense. For the year ended December 31, 2023, we recognized a net addition of accrued interest on unrecognized tax benefits in the amount of $106. For the years ended December 31, 2022, and 2021, we recognized a net reversal of accrued interest on unrecognized tax benefits in the amount of $3,662 and $1,455, respectively. As of December 31, 2023 and 2022, we had a total of $10,292 and $10,186, respectively, of accrued interest on unrecognized tax benefits which are included in “Accrued expenses and other liabilities” on the accompanying consolidated balance sheets. We believe that within the next 12 months, it is reasonably possible that the unrecognized tax benefits, excluding interest, as of December 31, 2023 will be reduced by approximately $4,150 due to statute expiration and effectively settled positions in various state jurisdictions.

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- 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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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