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Income Taxes (Tables) | 12 Months Ended
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Dec. 31, 2024
Income Tax Disclosure [Abstract] |
Income tax expense (benefit) attributable to continuing operations | Income tax expense attributable to continuing operations for each of the years in the three-year period ended December 31, 2024 is as follows (in thousands):
| 2024 |  | 2023 |  | 2022
Current tax expense : |  |  |  |  |
Federal | $ | 110,464 |  |  | $ | 67,711 |  |  | $ | 104,141 |
State | 15,040 |  |  | 11,775 |  |  | 12,870 |
Total current tax expense | 125,504 |  |  | 79,486 |  |  | 117,011 |
Deferred tax expense (benefit): |  |  |  |  |
Federal | (19,550) |  |  | 67,446 |  |  | 15,082 |
State | 199 |  |  | 4,922 |  |  | 4,658 |
Total deferred tax (benefit) expense | (19,351) |  |  | 72,368 |  |  | 19,740 |
Total income tax expense | $ | 106,153 |  |  | $ | 151,854 |  |  | $ | 136,751 |
Income tax rate reconciliation | Pinnacle Financial's income tax expense differs from the amounts computed by applying the Federal income tax statutory rate of 21% to income before income taxes. A reconciliation of the differences for each of the years in the three-year period ended December 31, 2024 is as follows (in thousands):
| 2024 |  | 2023 |  | 2022
Income tax expense at statutory rate | $ | 122,054 |  |  | $ | 149,941 |  |  | $ | 146,474 |
State excise tax expense, net of federal tax effect | 12,039 |  |  | 13,191 |  |  | 13,847 |
Non-deductible executive compensation | 5,635 |  |  | 5,186 |  |  | 5,481 |
Tax-exempt securities | (22,169) |  |  | (21,663) |  |  | (18,730) |
Federal tax credits | (8,170) |  |  | (5,238) |  |  | (5,019) |
Bank owned life insurance income | (8,780) |  |  | (4,324) |  |  | (4,599) |
Bank owned life insurance surrender | — |  |  | 8,572 |  |  | — |
Non-deductible FDIC assessment | 7,103 |  |  | 5,361 |  |  | 2,331 |
Insurance premiums | — |  |  | — |  |  | (36) |
Excess tax benefits associated with equity compensation | (2,806) |  |  | (208) |  |  | (3,027) |
Other items | 1,247 |  |  | 1,036 |  |  | 29 |
Income tax expense | $ | 106,153 |  |  | $ | 151,854 |  |  | $ | 136,751 |
Components of deferred income taxes included in other assets | The components of deferred income taxes included in other assets in the accompanying consolidated balance sheets at December 31, 2024 and 2023 are as follows (in thousands):
| 2024 |  | 2023
Deferred tax assets: |  |  |
Allowance for credit losses | $ | 99,002 |  |  | $ | 86,911 |
Loans | 4,463 |  |  | 4,659 |
Insurance | 878 |  |  | 784 |
Accrued liability for supplemental retirement agreements | 6,611 |  |  | 7,005 |
Restricted stock and stock options | 8,255 |  |  | 6,251 |
Securities | 44,504 |  |  | 49,331 |
Cash flow hedge | 8,772 |  |  | — |
FHLB related assets | 64 |  |  | — |
Lease liability | 76,426 |  |  | 76,918 |
Other real estate owned | — |  |  | 750 |
Net federal operating loss carryforward and credits | 9,621 |  |  | 1,064 |
Annual incentive compensation | 20,473 |  |  | 11,842 |
Partnership interests | 33,747 |  |  | 13,541 |
Allowance for off balance sheet credit exposures | 3,117 |  |  | 4,367 |
Tax credit investments | 2,601 |  |  | — |
FDIC special assessment | 6,254 |  |  | 7,250 |
Accrued expenses | 1,465 |  |  | 844 |
Other deferred tax assets | 2,426 |  |  | 1,688 |
Total deferred tax assets | 328,679 |  |  | 273,205 |
Deferred tax liabilities: |  |  |
Depreciation and amortization | 20,438 |  |  | 23,140 |
Core deposit and other intangible assets | 5,193 |  |  | 6,087 |
Cash flow hedge | — |  |  | 836 |
REIT dividends | 2,247 |  |  | 2,604 |
Mortgage servicing rights | 2,963 |  |  | — |
FHLB related liabilities | — |  |  | 125 |
Equity method investment | 18 |  |  | 42 |
Right-of-use assets and other leasing transactions | 72,886 |  |  | 74,068 |
Leases | 83,810 |  |  | 67,711 |
Subordinated debt | 1,293 |  |  | 1,412 |
Tax credit investments | — |  |  | 7,614 |
Prepaids | 1,611 |  |  | 273 |
Other deferred tax liabilities | 2,748 |  |  | 2,083 |
Total deferred tax liabilities | 193,207 |  |  | 185,995 |
Net deferred tax assets | $ | 135,472 |  |  | $ | 87,210 |
Rollforward of uncertain tax positions | A reconciliation of the beginning and ending unrecognized tax benefit related to state uncertain tax positions for each of the years in the three-year period ended December 31, 2024 is as follows (in thousands):
| 2024 |  | 2023 |  | 2022
Balance at January 1, | $ | 8,806 |  |  | $ | 15,752 |  |  | $ | 12,737 |
Increases due to tax positions taken during the current year | 140 |  |  | 642 |  |  | 3,721 |
Increases due to tax positions taken during a prior year | 3,831 |  |  | — |  |  | — |
Decreases due to the lapse of the statute of limitations during the current year | (1,750) |  |  | (1,340) |  |  | (706) |
Decreases due to settlements with the taxing authorities during the current year | (900) |  |  | (6,248) |  |  | — |
Balance at December 31, | $ | 10,127 |  |  | $ | 8,806 |  |  | $ | 15,752 |

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