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Income Taxes
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Income Taxes
Note 16 - Income Taxes
The components of income tax expense (benefit) included on the consolidated statements of income for the years ended December 31, 2021, 2020, and 2019 are presented below:
(in thousands)202120202019
Current
Federal$153,911 $187,741 $112,517 
State29,982 9,421 2,085 
Total current income tax expense183,893 197,162 114,602 
Deferred
Federal28,873 (90,777)46,182 
State16,127 4,585 40,451 
Total deferred income tax expense (benefit) 45,000 (86,192)86,633 
Total income tax expense$228,893 $110,970 $201,235 
Income tax expense as shown on the consolidated statements of income differed from the federal statutory rate for the years ended December 31, 2021, 2020, and 2019. A reconciliation of the differences is presented below:
Years Ended December 31,
(dollars in thousands)202120202019
Income tax expense at statutory federal income tax rate$207,765 $101,779 $160,653 
Increase (decrease) resulting from:
State income tax expense, net of federal income tax benefit38,452 11,168 33,764 
Income not subject to tax(10,455)(9,207)(6,564)
Low income housing tax credits and other tax benefits, net of amortization(4,858)(2,611)(1,583)
FDIC premiums
4,111 4,744 5,802 
General business tax credits
(3,727)(657)(678)
Excess tax benefit from share-based compensation(3,084)311 (1,337)
    Executive compensation1,096 1,501 6,385 
    Goodwill impairment— 9,424 — 
Other, net(407)(5,482)4,793 
Total income tax expense$228,893 $110,970 $201,235 
Effective tax rate23.1 %22.9 %26.3 %
The components of the Company's deferred tax assets and liabilities at December 31, 2021 and 2020 are presented below:
(in thousands)20212020
Deferred tax assets
Allowance for loan losses$112,180 $165,691 
Lease liability102,412 98,340 
Employee benefits and deferred compensation35,782 27,917 
Net operating loss carryforwards23,897 29,684 
Net unrealized losses on investment securities available for sale and cash flow hedges19,261 — 
Deferred revenue18,487 24,751 
Tax credit carryforwards15,870 8,605 
Fair value of investment securities and loans6,439 10,093 
Non-performing loan interest2,621 12,472 
Other7,100 9,819 
Total gross deferred tax assets344,049 387,372 
Less valuation allowance(19,003)(19,191)
Total deferred tax assets325,046 368,181 
Deferred tax liabilities
Right-of-use asset(98,773)(98,681)
Excess tax over financial statement depreciation(27,355)(40,452)
Purchase accounting intangibles(14,820)(14,458)
Other properties held for sale(5,345)(3,025)
Prepaid expense(4,631)(5,955)
Net unrealized gains on investment securities available for sale and cash flow hedges— (64,344)
Other(5,071)(10,418)
Total gross deferred tax liabilities(155,995)(237,333)
Net deferred tax assets$169,051 $130,848 
Synovus believes the realization of net deferred tax assets (after valuation allowance) at December 31, 2021 is more likely than not based on its history of cumulative profitability as well as expectations of future taxable income, including reversals of taxable temporary differences, in the jurisdictions in which it operates.
Synovus expects that a portion of its $23.9 million of federal and state NOLs, which have carryforward periods ending in tax years 2023 through 2034, will not be realized before their carryforward period lapses and the Company has accordingly established a valuation allowance in the amount of $19.0 million at December 31, 2021 and $19.2 million at December 31, 2020. State tax credit deferred tax assets at December 31, 2021 total $15.9 million and have expiration dates through the tax year 2031.
State NOLs and tax credit carryforwards as of December 31, 2021 are summarized in the following table.
Tax CarryforwardsAs of December 31, 2021
(in thousands)Expiration DatesDeferred
Tax Asset, Before Valuation Allowance		Valuation AllowanceNet Deferred Tax Asset Balance
Net operating losses - federal2027-2033$19,592 $(15,851)$3,741 
Net operating losses - states2023-20344,305 (3,152)1,153 
Other credits - states2022-203115,870 — 15,870 
Synovus is subject to income taxation in the United States and various state and local taxing jurisdictions. Generally, Synovus is no longer subject to income tax examinations by the IRS for years before 2018 and by state and local income tax authorities for years before 2015. Although Synovus is unable to determine the ultimate outcome of current and future examinations, Synovus believes that the resolution of these examinations will not have a material effect on the consolidated financial statements.
A reconciliation of the beginning and ending amount of unrecognized income tax benefits is as follows (unrecognized state income tax benefits are not adjusted for the federal income tax impact).
Years Ended December 31,
(in thousands)202120202019
Balance at January 1,
$20,250 $20,994 $18,586 
Additions based on income tax positions related to current year
3,754 461 550 
Additions for income tax positions of prior years(1)
1,379 147 — 
Additions from acquisition
— — 3,464 
Reductions for income tax positions of prior years
(200)(327)(1,589)
Statute of limitation expirations
(79)(820)(17)
Settlements
— (205)— 
Balance at December 31,
$25,104 $20,250 $20,994 
(1)    Includes deferred tax benefits that could reduce future tax liabilities.
Accrued interest and penalties related to unrecognized income tax benefits are recognized as a component of income tax expense, and totaled $3.3 million, $2.7 million, and $3.3 million as of December 31, 2021, 2020 and 2019, respectively. Unrecognized income tax benefits as of December 31, 2021, 2020 and 2019 that, if recognized, would affect the effective income tax rate totaled $23.5 million, $19.1 million and $20.4 million (net of the federal benefit on state income tax issues), respectively. It is reasonably possible that significant changes in the balance of unrecognized tax benefits may occur within the next 12 months. At this time, Synovus expects that $2.3 million of uncertain income tax positions will be either settled or resolved during the next twelve months.