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Income Taxes
 12 Months Ended
Dec. 31, 2024
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, 2024, 2023, and 2022 are presented below:
(in thousands)202420232022
Current
Federal$83,744 $107,445 $167,255 
State22,387 29,739 28,152 
Total current income tax expense106,131 137,184 195,407 
Deferred
Federal19,292 13,124 11,570 
State79 3,713 (702)
Total deferred income tax expense (benefit) 19,371 16,837 10,868 
Total income tax expense$125,502 $154,021 $206,275 
Income tax expense as shown on the consolidated statements of income differed from the federal statutory rate for the years ended December 31, 2024, 2023, and 2022. A reconciliation of the differences is presented below:
Years Ended December 31,
(dollars in thousands)202420232022
Income tax expense at statutory federal income tax rate$127,040 $146,194 $202,477 
Increase (decrease) resulting from:
State income tax expense, net of federal income tax benefit17,871 28,415 21,981 
Tax credits and related benefits, net of amortization (as applicable)(21,329)(21,037)(9,629)
Income not subject to tax(11,857)(10,477)(9,346)
FDIC premiums
7,684 8,589 5,517 
    Executive compensation2,965 3,575 2,152 
Excess tax benefit from share-based compensation98 (1,416)(3,153)
Other, net3,030 178 (3,724)
Total income tax expense$125,502 $154,021 $206,275 
Effective tax rate20.7 %22.1 %21.4 %
The components of the Company's deferred tax assets and liabilities at December 31, 2024 and 2023 are presented below:
(in thousands)20242023
Deferred tax assets
Net unrealized losses on investment securities available for sale and cash flow hedges$302,128 $348,712 
Allowance for credit losses131,373 130,205 
Lease liability111,089 120,534 
Employee benefits and deferred compensation47,642 40,601 
Net operating loss carryforwards32,511 32,126 
Tax credit carryforwards14,143 15,532 
FDIC special assessment9,087 12,058 
Unrealized losses on fair value hedges4,252 7,480 
Non-performing loan interest7,923 5,877 
Miscellaneous accrued expenses4,948 5,659 
Fair value of investment securities and loans1 1,422 
Other8,167 7,423 
Total gross deferred tax assets673,264 727,629 
Less valuation allowance(27,483)(26,184)
Total deferred tax assets645,781 701,445 
Deferred tax liabilities
Right-of-use asset(104,190)(114,529)
Purchase accounting intangibles(22,535)(23,276)
Excess tax over financial statement depreciation(13,685)(20,457)
Deferred loan costs(16,293)(16,810)
Unrealized gain on hedged liabilities(4,252)(7,480)
Prepaid expense(5,498)(6,917)
Partnership investments(2,995)(1,980)
Other properties held for sale(914)(1,434)
Other(4,899)(1,660)
Total gross deferred tax liabilities(175,261)(194,543)
Net deferred tax asset$470,520 $506,902 
Synovus believes the realization of net deferred tax assets (after valuation allowance) at December 31, 2024 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 $32.5 million of federal and state NOLs as well as a portion of the $14.1 million of federal and state tax credit carryforwards, which have carryforward periods ending in tax years 2025 through 2044, will not be realized before their carryforward period lapses and the Company has accordingly established a valuation allowance in the amount of $27.5 million at December 31, 2024.
Federal and state NOLs and tax credit carryforwards as of December 31, 2024 are summarized in the following table on a tax effected basis.
Tax CarryforwardsAs of December 31, 2024
(in thousands)Expiration DatesDeferred
Tax Asset, Before Valuation Allowance		Valuation AllowanceNet Deferred Tax Asset Balance
Net operating losses - federal(1)
2027-2037$25,482 $(20,749)$4,733 
Net operating losses - states(1)
2027-20447,030 (5,705)1,325 
Tax credits - federal 2034-2044835 (460)375 
Tax credits - states(1)
2025-203213,307 (569)12,738 
(1)    Included in this balance are tax attributes that can be carried forward indefinitely and have no expiration date.
Synovus is subject to income taxation in the U.S. and various state and local taxing jurisdictions. Synovus is no longer subject to income tax examinations by the IRS for years before 2021. With limited exceptions, the Company is no longer subject to income tax examinations by state and local taxing authorities for years before 2020.
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)202420232022
Balance at January 1,
$22,312 $22,400 $25,104 
Additions based on income tax positions related to current year
520 719 649 
Additions for income tax positions of prior years(1)
39 186 247 
Reductions for income tax positions of prior years
(209)(122)(1,215)
Statute of limitation expirations
(982)(871)(2,002)
Settlements
— — (383)
Balance at December 31,
$21,680 $22,312 $22,400 
(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 $5.7 million, $4.8 million, and $3.2 million as of December 31, 2024, 2023, and 2022, respectively. Unrecognized income tax benefits as of December 31, 2024, 2023, and 2022 that, if recognized, would affect the effective income tax rate totaled $22.9 million, $22.5 million and $20.9 million (net of the federal benefit on state income tax issues), respectively. However, based on ongoing correspondence with state taxing authorities subsequent to year-end, Synovus believes that $15.6 million of uncertain income tax positions will be settled and result in an increase in income tax expense of approximately $6 million in 2025.