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Income Taxes
 9 Months Ended
Sep. 30, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The gross liability for unrecognized tax benefits at September 30, 2023 and December 31, 2022 was $17,618 and $15,204, respectively, exclusive of interest and penalties, of which $17,224 and $14,431 would affect the effective tax rate if the Company were to recognize the tax benefit.
The Company classifies interest and penalties on unrecognized tax benefits as income tax expense. As of September 30, 2023 and December 31, 2022, the combined amount of accrued interest and penalties related to tax positions taken on tax returns was $1,916 and $1,118, respectively.
September 30, 2023December 31, 2022
Gross liability for unrecognized tax benefits, exclusive of interest and penalties$17,618 $15,204 
Interest and penalties on unrecognized benefits1,916 1,118 
Total gross uncertain tax positions$19,534 $16,322 
Amount included in Current liabilities$4,172 $4,065 
Amount included in Other long-term liabilities15,362 12,257 
$19,534 $16,322 
The effective income tax rate for the three and nine months ended September 30, 2023 and 2022 differs from the federal income tax statutory rate due to the following:
Three Months Ended September 30,Nine Months Ended September 30,
2023202220232022
Statutory rate21.0 %21.0 %21.0 %21.0 %
State taxes, net of federal tax benefit2.8 3.4 2.8 2.9 
Foreign tax expense and tax rate differential(0.1)(0.2)(0.1)(0.1)
Tax benefit from stock option exercises(0.6)(1.1)(0.3)(0.5)
Other, net(0.6)(0.1)(0.2)(0.2)
22.5 %23.0 %23.2 %23.1 %
The decrease in the effective tax rate for the three months ended September 30, 2023 was primarily due to a decrease in the state effective tax rate. The decrease was partially offset by lower tax benefits related to the stock option exercises as a percentage of net income in the third quarter of 2023 compared to the third quarter of 2022.
The Company files income tax returns in the United States on a consolidated basis and in many U.S. state and foreign jurisdictions. The Company is subject to examination of income tax returns by the Internal Revenue Service (IRS) and other domestic and foreign tax authorities. The Company is no longer subject to U.S. federal income tax examination for years before 2019 and is no longer subject to state, local or foreign income tax examinations by authorities for years before 2015.
The Company estimates it will recognize $4,172 of gross unrecognized tax benefits. This amount is expected to be paid within one year or to be removed at the expiration of the statute of limitations and resolution of income tax audits and is netted against the current payable account. These unrecognized tax benefits are related to tax positions taken on certain federal, state, and foreign tax returns. However, the timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. While it is reasonably possible that some issues under examination could be resolved in the next twelve months, based upon the current facts and circumstances, the Company cannot reasonably estimate the timing of such resolution or the total range of potential changes as it relates to the current unrecognized tax benefits that are recorded as part of the Company’s financial statements.