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Income Taxes | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Income Tax Provision The income tax provision was as follows:
| Year Ended December 31,
($ in millions) | 2024 |  | 2023 |  | 2022
Current: |  |  |  |  |
Federal | $ | 165.6 |  |  | $ | 207.5 |  |  | $ | 269.2 |
State | 49.0 |  |  | 71.7 |  |  | 105.5 |
Foreign | 1.8 |  |  | 7.4 |  |  | (0.9) |
Total current provision | 216.4 |  |  | 286.6 |  |  | 373.8 |
Deferred: |  |  |  |  |
Federal | 12.4 |  |  | 43.7 |  |  | 73.4 |
State | 12.5 |  |  | 8.1 |  |  | 13.5 |
Foreign | 15.4 |  |  | 12.2 |  |  | 7.7 |
Total deferred provision | 40.3 |  |  | 64.0 |  |  | 94.6 |
Total provision | $ | 256.7 |  |  | $ | 350.6 |  |  | $ | 468.4 |
At December 31, 2024, we had income taxes receivable of $8.7 million included as a component of other current assets in our Consolidated Balance Sheet. At December 31, 2023, we had income taxes payable of $28.9 million included as a component of accrued liabilities in our Consolidated Balance Sheet. The reconciliation between amounts computed using the federal income tax rate of 21% and our income tax provision is shown in the following tabulation:
| Year Ended December 31,
($ in millions) | 2024 |  | 2023 |  | 2022
Federal tax provision at statutory rate | $ | 225.1 |  |  | $ | 286.0 |  |  | $ | 363.3 |
State taxes, net of federal income tax benefit | 52.0 |  |  | 39.5 |  |  | 76.9 |
Non-deductible items | 11.9 |  |  | 10.8 |  |  | 5.0 |
Permanent differences related to share-based compensation | (0.5) |  |  | — |  |  | (2.4) |
Net change in valuation allowance | (13.3) |  |  | 19.9 |  |  | 25.0 |
General business credits | (22.1) |  |  | (5.3) |  |  | (2.6) |
Foreign rate differential | 2.5 |  |  | 3.1 |  |  | 1.4 |
Other | 1.1 |  |  | (3.4) |  |  | 1.8 |
Income tax provision | $ | 256.7 |  |  | $ | 350.6 |  |  | $ | 468.4 |
Deferred Taxes Individually significant components of the deferred tax assets and (liabilities) are presented below:
| December 31,
($ in millions) | 2024 |  | 2023
Deferred tax assets: |  |  |
Deferred revenue and cancellation reserves | $ | 113.6 |  |  | $ | 105.2 |
Allowances and accruals | 81.8 |  |  | 80.1 |
Lease liability | 173.5 |  |  | 125.7 |
Credits and other | 23.2 |  |  | 14.7 |
Net operating losses | 45.7 |  |  | 41.6 |
Capital loss | 30.5 |  |  | 33.7 |
Valuation allowance | (70.6) |  |  | (71.3) |
Total deferred tax assets | 397.7 |  |  | 329.7 |
Deferred tax liabilities: |  |  |
Inventories | (53.2) |  |  | (50.3) |
Goodwill | (317.8) |  |  | (213.7) |
Property and equipment, principally due to differences in depreciation | (188.4) |  |  | (244.1) |
Right of use asset | (165.7) |  |  | (121.3) |
Prepaid expenses and other | (69.7) |  |  | (49.6) |
Total deferred tax liabilities | (794.8) |  |  | (679.0) |
Total | $ | (397.1) |  |  | $ | (349.3) |
We consider whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon future taxable income during the periods in which those temporary differences become deductible. We consider the scheduled reversal of deferred tax liabilities (including the impact of available carryback and carryforward periods), projected future taxable income, and tax-planning strategies in making this assessment. As of December 31, 2024, we had a $70.6 million valuation allowance recorded associated with our deferred tax assets. Of the total valuation allowance, $30.5 million relates to our capital loss carryover and $40.1 million relates to state net operating losses generated in current and previous years. During the year, the capital loss valuation allowance increased $0.8 million as a result of valuation allowance related to acquired U.K. capital losses offset by available U.S. capital gain during the carryback period and in the current year. The state NOL valuation allowance decreased $1.5 million in the current year as a result of a reduction in state deferred tax rate, offset by losses incurred, the benefits of which are not expected to be realized. As of December 31, 2024, we had net operating loss (NOL) carryforwards and capital loss carryforwards totaling approximately $76.2 million. Of these carryforwards, approximately $58.0 million will expire, if not utilized, in various years through 2044. The remaining carryforwards have no expiration. We have taken the position that we intend to indefinitely reinvest the earnings of our Canadian subsidiaries to ensure there is sufficient working capital to expand operations in Canada. Accordingly, we have not recorded a deferred tax liability related to foreign withholding taxes on approximately $77.2 million of undistributed earnings of these Canadian subsidiaries as of December 31, 2024. Approximately $3.8 million of tax would be payable upon the remittance of these undistributed earnings. We do not intend to indefinitely reinvest the earnings of our U.K. subsidiaries, however, we have not recorded a deferred tax liability related to foreign withholding taxes due to a 0% treaty rate on dividends. Unrecognized Tax Benefits The following is a reconciliation of our unrecognized tax benefits for December 31, 2024, 2023, and 2022:
($ in millions) |
Balance, December 31, 2022 | $ | 0.6 |
Increase related to tax positions taken - current year | 0.3 |
Balance, December 31, 2023 | 0.9 |
Increase related to tax positions taken - current year | — |
Balance, December 31, 2024 | $ | 0.9 |
Open tax years at December 31, 2024 included the following:
Federal | 2021 - 2024
States (30) | 2020 - 2024
Canada | 2021 - 2024
United Kingdom | 2021 - 2024

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