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Income Taxes | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | 16. Income Taxes The components of income tax expense (benefit) for continuing operations were as follows:
| Year Ended December 31,
Total Income Tax Expense (Benefit) on continuing operations | 2021 |  | 2020 |  | 2019
Current Income Taxes |  |  |  |  |
Federal | $ | 7 |  |  | $ | (3) |  |  | $ | 19 |
State | 113 |  |  | 92 |  |  | 74 |
Total current income taxes | 120 |  |  | 89 |  |  | 93 |
Deferred Income Taxes |  |  |  |  |
Federal | 376 |  |  | 87 |  |  | (303) |
State | (25) |  |  | (83) |  |  | (68) |
Total deferred income taxes | 351 |  |  | 4 |  |  | (371) |
Total income tax expense (benefit) | $ | 471 |  |  | $ | 93 |  |  | $ | (278) |
The provision for income taxes does not reflect the tax effects of the sale of the Company’s reverse servicing portfolio reported as discontinued operations. The following table presents a reconciliation of the income tax provision computed at the U.S. federal statutory tax rate to the actual effective tax rate:
| Year Ended December 31,
Reconciliation of the Income Tax Provision | 2021 |  | 2020 |  | 2019
Tax Expense (Benefit) at Federal Statutory Rate | $ | 407 |  |  | 21.0 | % |  | $ | 84 |  |  | 21.0 | % |  | $ | (5) |  |  | 21.0 | %
Effect of: |  |  |  |  |  |  |  |  |  |  |
State taxes, net of federal benefit | 70 |  |  | 3.6 | % |  | 8 |  |  | 1.7 | % |  | 3 |  |  | (17.5) | %
Non-controlling interests | — |  |  | — | % |  | — |  |  | — | % |  | 1 |  |  | (3.1) | %
Change in valuation allowance | — |  |  | — | % |  | — |  |  | — | % |  | (285) |  |  | 1,172.8 | %
Deferred adjustments | (6) |  |  | (0.3) | % |  | (5) |  |  | (1.1) | % |  | 2 |  |  | (9.3) | %
Nondeductible items | 2 |  |  | 0.1 | % |  | 7 |  |  | 1.7 | % |  | 5 |  |  | (19.9) | %
Other, net | (2) |  |  | (0.1) | % |  | (1) |  |  | (0.3) | % |  | 1 |  |  | (0.8) | %
Total income tax expense (benefit) | $ | 471 |  |  | 24.3 | % |  | $ | 93 |  |  | 23.0 | % |  | $ | (278) |  |  | 1,143.2 | %
In 2021 and 2020, the effective tax rate differed from the statutory tax rate primarily due to state tax adjustments and permanent differences such as nondeductible executive compensation and nondeductible penalties. In 2019, the effective tax rate differed from the statutory tax rate primarily due to the release of the valuation allowance associated with the net operating loss (“NOL”) carryforwards of WMIH and state tax adjustments. The Company has federal NOL carryforwards (pre-tax) of approximately $0.6 billion and $2.6 billion as of December 31, 2021 and 2020, respectively. In the assessment of whether a valuation allowance was required as of December 31, 2021, the Company considered the four sources of taxable income under ASC 740-10-30-18 including the future reversals of existing taxable temporary differences and identified tax planning strategies that were considered prudent and feasible. Consistent with the prior year analysis, the Company based its projection of future taxable income on historical pre-tax income and assumed a steady state of operations that would generate cash flows and liquidity sufficient to maintain current operations. The Company considered other factors in its determination of future taxable income that was demonstrated by historical performance. As a result, the Company still believes it is more likely than not that its deferred tax assets will be realized prior to their expiration except for certain federal 382 limited NOLs that begin to expire with the 2026 tax year, if unused, and immaterial state NOL carryforwards that begin to expire with the 2021 tax year, if unused. Accordingly, the Company has recorded a federal and state valuation allowance of $7 and $2, respectively, as of December 31, 2021 and 2020 related to these NOL carryforwards. The Company does not expect any future tax loss limitations under Sections 382 and 384 that would impact its utilization of remaining federal NOL carryforwards. Temporary differences and carryforwards that give rise to deferred tax assets and liabilities are comprised of the following:
Deferred Tax Assets and Liabilities | December 31, 2021 |  | December 31, 2020
Deferred Tax Assets |  |  |
Effect of: |  |  |
Goodwill and intangible assets | $ | 998 |  |  | $ | 728 |
Loss carryforwards (federal, state & capital) | 134 |  |  | 558 |
Loss reserves | 104 |  |  | 115 |
Lease liability | 30 |  |  | 26 |
Accruals | 16 |  |  | 24 |
Other, net | 20 |  |  | 52 |
Total deferred tax assets | 1,302 |  |  | 1,503 |
Deferred Tax Liabilities |  |  |
MSR amortization and mark-to-market, net | (240) |  |  | (117) |
Right-of-use assets | (27) |  |  | (23) |
Depreciation and amortization, net | (19) |  |  | (13) |
Prepaid assets | (2) |  |  | (2) |
Other, net | (14) |  |  | — |
Total deferred tax liabilities | (302) |  |  | (155) |
Valuation allowance | (9) |  |  | (9) |
Deferred tax assets, net | $ | 991 |  |  | $ | 1,339 |
The Company elected to account for the Global Intangible Low-Taxed Income (“GILTI”) tax expense in the period in which it is incurred. As a result, no deferred tax impact of GILTI has been provided in the consolidated financial statements. The Company files income tax returns in the U.S. federal jurisdiction and numerous U.S. state jurisdictions. With few exceptions, as of December 31, 2021, the Company is no longer subject to U.S. federal and state income tax examinations for tax years prior to 2018. As of December 31, 2021 and 2020, the Company had no unrecognized tax benefits recorded related to uncertain tax positions.

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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 -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=121826272&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=122134291&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=121826272&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=122134291&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=121826272&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 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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