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Income Taxes | 12 Months Ended
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Dec. 31, 2019
Components Of Income Tax Expense Benefit Continuing Operations [Abstract] |
Income Taxes | NOTE 25 – Income Taxes The provision for income taxes consists of the following (in thousands):
|  | Year Ended December 31, |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Current taxes: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 123,802 |  |  | $ | 89,971 |  |  | $ | (29,396 | )
State |  |  | 30,464 |  |  |  | 36,070 |  |  |  | (334 | )
Foreign |  |  | 1,684 |  |  |  | 99 |  |  |  | (1,734 | )
|  |  | 155,950 |  |  |  | 126,140 |  |  |  | (31,464 | )
Deferred taxes: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | (7,027 | ) |  |  | 11,932 |  |  |  | 114,842 |
State |  |  | 4,266 |  |  |  | 2,267 |  |  |  | 1,728 |
Foreign |  |  | (4,037 | ) |  |  | 55 |  |  |  | 1,559 |
|  |  | (6,798 | ) |  |  | 14,254 |  |  |  | 118,129 |
Provision for income taxes |  | $ | 149,152 |  |  | $ | 140,394 |  |  | $ | 86,665 |
Reconciliation of the statutory federal income tax rate with our company’s effective income tax rate is as follows (in thousands):
|  | Year Ended December 31, |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Statutory rate |  | $ | 125,485 |  |  | $ | 112,215 |  |  | $ | 94,338 |
State income taxes, net of federal income tax |  |  | 28,333 |  |  |  | 30,762 |  |  |  | 6,721 |
Change in uncertain tax position |  |  | 2,661 |  |  |  | (617 | ) |  |  | 1,544 |
Foreign tax rate difference |  |  | (629 | ) |  |  | (318 | ) |  |  | (412 | )
Excess tax benefit from stock-based compensation |  |  | (9,670 | ) |  |  | (3,700 | ) |  |  | (57,431 | )
Revaluation of deferred tax assets |  |  | — |  |  |  | (3,006 | ) |  |  | 42,443 |
Other, net |  |  | 2,972 |  |  |  | 5,058 |  |  |  | (538 | )
|  | $ | 149,152 |  |  | $ | 140,394 |  |  | $ | 86,665 |
Tax effect of temporary differences and carryforwards that comprise significant portions of deferred tax assets and liabilities (in thousands):
|  | December 31, |
|  | 2019 |  |  | 2018 |
Deferred tax assets: |  |  |  |  |  |  |  |
Lease liabilities |  | $ | 181,607 |  |  | $ | — |
Deferred compensation |  |  | 80,389 |  |  |  | 74,916 |
Receivable reserves |  |  | 33,199 |  |  |  | 30,252 |
Net operating loss carryforwards |  |  | 28,781 |  |  |  | 29,699 |
Accrued expenses |  |  | 26,166 |  |  |  | 19,832 |
Unrealized loss on investments |  |  | — |  |  |  | 10,635 |
Other |  |  | 3,210 |  |  |  | 3,066 |
Total deferred tax assets |  |  | 353,352 |  |  |  | 168,400 |
Valuation allowance |  |  | (5,042 | ) |  |  | (3,944 | )
|  |  | 348,310 |  |  |  | 164,456 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Lease ROU asset |  |  | (180,598 | ) |  |  | — |
Goodwill and other intangibles |  |  | (46,625 | ) |  |  | (42,045 | )
Depreciation |  |  | (7,231 | ) |  |  | (6,629 | )
Unrealized gain on investments |  |  | (5,619 | ) |  |  | — |
Prepaid expenses |  |  | (3,857 | ) |  |  | (3,774 | )
|  |  | (243,930 | ) |  |  | (52,448 | )
Net deferred tax asset |  | $ | 104,380 |  |  | $ | 112,008 |
On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (“Tax Legislation”) was signed into law making significant changes to the Internal Revenue Code. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning after December 31, 2017, the transition of U.S international taxation from a worldwide tax system to a territorial system, and a one-time transition tax on the mandatory deemed repatriation of cumulative foreign earnings as of December 31, 2017. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (“SAB 118”), which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. In accordance with SAB 118, we recorded an additional tax benefit of $3.0 million during 2018 for the re-measurement of certain deferred tax assets and liabilities based on the rates in which they are expected to reverse in the future. Our measurement of deferred tax taxes and our provisional analysis of the one-time repatriation transition tax is complete with no additional impact on current year earnings. Our net deferred tax asset at December 31, 2019, includes net operating loss carryforwards of $236.2 million that expire between 2024 and 2039. Certain of our net operating loss carryforwards do not expire. A valuation allowance is recorded to the extent that it is more likely than not that any portion of the deferred tax asset will not be realized. The valuation allowance was increased by $1.1 million. We believe the realization of the remaining net deferred tax asset of $104.4 million is more likely than not based on the ability to carry back losses against prior year taxable income for tax years before 2018 and carry forward net operating losses indefinitely after 2018, and expectations of future taxable income, which is supported by a history of cumulative income. The current tax payable, included in accounts payable and accrued expenses, is $15.0 million and $8.4 million as of December 31, 2019 and 2018, respectively. At December 31, 2019, the Company did not have a tax receivable. At December 31, 2018, the Company did not have a tax receivable. As of December 31, 2019, we considered all undistributed earnings of non-U.S. subsidiaries to be permanently reinvested. Therefore, we have not provided for any U.S. deferred income taxes. Because the time or manner of repatriation is uncertain, we cannot determine the impact of local taxes, withholding taxes and foreign tax credits associated with the future repatriation of such earnings, and therefore cannot quantify the tax liability that would be payable in the event all such foreign earnings are repatriated. Uncertain Tax Positions As of December 31, 2019 and 2018, we had $3.4 million and $0.3 million, respectively, of gross unrecognized tax benefits, all of which, if recognized, would impact the effective tax rate. We recognize interest and penalties related to uncertain tax positions in provision for income taxes in the consolidated statements of operations. As of December 31, 2019 and 2018, we had accrued interest and penalties of $0.2 million and $0.1 million, respectively, before benefit of federal tax deduction, included in accounts payable and accrued expenses in our consolidated statements of financial condition. The amount of interest and penalties recognized in our consolidated statements of operations for the years ended December 31, 2019, 2018, and 2017, was not significant. The following table summarizes the activity related to our company’s unrecognized tax benefits from January 1, 2017 to December 31, 2019 (in thousands):
|  | Year Ended December 31, |
|  | 2019 |  |  | 2018 |  |  | 2017 |
Beginning balance |  | $ | 312 |  |  | $ | 3,180 |  |  | $ | 1,800 |
Increase related to prior year tax positions |  |  | 2,173 |  |  |  | 4 |  |  |  | 3,036 |
Decrease related to prior year tax positions |  |  | (54 | ) |  |  | (33 | ) |  |  | (287 | )
Increase related to current year tax positions |  |  | 956 |  |  |  | 191 |  |  |  | — |
Decrease related to settlements with taxing authorities |  |  | — |  |  |  | (3,030 | ) |  |  | (171 | )
Decrease related to lapsing of statute of limitations |  |  | — |  |  |  | — |  |  |  | (1,198 | )
Ending balance |  | $ | 3,387 |  |  | $ | 312 |  |  | $ | 3,180 |
We file income tax returns with the U.S. federal jurisdiction, various states, and certain foreign jurisdictions. We are not subject to U.S. federal examination for taxable years before 2013. We are not subject to certain state and local, or non-U.S. income tax examinations for taxable years before 2010. There is a reasonable possibility that the unrecognized tax benefits will change within the next 12 months as a result of the expiration of various statutes of limitations or for the resolution of U.S. federal and state examinations, but we do not expect this change to be material to the consolidated financial statements.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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