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Income Taxes
 12 Months Ended
Nov. 30, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Income Tax Expense.  The components of the income tax expense in our consolidated statements of operations are as
follows (in thousands):
Federal
State
Total
2024
Current
$(147,300)
$(31,500)
$(178,800)
Deferred
(3,100)
(14,000)
(17,100)
Income tax expense
$(150,400)
$(45,500)
$(195,900)
2023
Current
$(123,200)
$(17,200)
$(140,400)
Deferred
(8,400)
(32,300)
(40,700)
Income tax expense
$(131,600)
$(49,500)
$(181,100)
2022
Current
$(194,400)
$(49,500)
$(243,900)
Deferred
(2,900)
(8,600)
(11,500)
Income tax expense
$(197,300)
$(58,100)
$(255,400)
Our effective tax rates were 23.0% for 2024, 23.5% for 2023 and 23.8% for 2022.
In 2024, our income tax expense and effective tax rate included the favorable impacts of $19.3 million of Section 45L tax
credits we recognized primarily from building energy-efficient homes and $7.9 million of excess tax benefits related to stock-
based compensation, partly offset by $10.7 million of non-deductible executive compensation expense.  In 2023, our income
tax expense and effective tax rate reflected the favorable impacts of $25.2 million of Section 45L tax credits and $5.5 million of
excess tax benefits related to stock-based compensation, partly offset by $12.2 million of non-deductible executive
compensation expense.  In 2022, our income tax expense and effective tax rate reflected the favorable impacts of $22.6 million
of Section 45L tax credits and $1.8 million of excess tax benefits related to stock-based compensation, partly offset by
$9.7 million of non-deductible executive compensation expense.   
The IRA tied Section 45L tax credit qualification for energy-efficient homes built on and after January 1, 2023 to new
homes achieving ENERGY STAR certification.  Based on guidance the IRS issued in September 2023, fewer of the ENERGY
STAR homes we build in California meet the heightened qualification standard the IRS selected for homes built in that state
relative to other states.  
Deferred Tax Assets, Net.  Deferred income taxes result from temporary differences in the financial and tax basis of assets
and liabilities.  Significant components of our deferred tax liabilities and assets are as follows (in thousands):
 
November 30,
 
2024
2023
Deferred tax liabilities:
Capitalized expenses
$26,792
$29,395
State taxes
9,680
12,152
Depreciation and amortization
8,055
8,179
Other
308
374
Total
44,835
50,100
Deferred tax assets:
Warranty, legal and other accruals
50,360
53,805
Employee benefits
53,282
51,325
Capitalized expenses
21,861
22,538
NOLs from 2006 through 2023
21,811
33,827
Inventory impairment and land option contract abandonment charges
7,653
15,878
Partnerships and joint ventures
5,879
6,193
Tax credits
2,019
1,857
Other
1,191
1,052
Total
164,056
186,475
Valuation allowance
(16,800)
(16,900)
Total
147,256
169,575
Deferred tax assets, net
$102,421
$119,475
Reconciliation of Expected Income Tax Expense.  The income tax expense computed at the statutory U.S. federal income
tax rate and the income tax expense provided in our consolidated statements of operations differ as follows (dollars in
thousands):
 
Years Ended November 30,
 
2024
2023
2022
$
%
$
%
$
%
Income tax expense computed at statutory rate
$(178,692)
(21.0)%
$(161,982)
(21.0)%
$(225,121)
(21.0)%
Tax credits
19,321
2.3
25,218
3.3
22,565
2.1
Stock compensation
6,405
.7
4,471
.6
1,442
.2
Dividend received deduction
986
.1
—
—
—
—
Valuation allowance for deferred tax assets
100
—
200
—
300
—
Non-deductible compensation
(8,703)
(1.0)
(9,975)
(1.3)
(7,905)
(.7)
State taxes, net of federal income tax benefit
(36,028)
(4.2)
(39,307)
(5.1)
(46,139)
(4.3)
Other, net
711
.1
275
—
(542)
(.1)
Income tax expense 
$(195,900)
(23.0)%
$(181,100)
(23.5)%
$(255,400)
(23.8)%
Deferred Tax Asset Valuation Allowance.  We evaluate our deferred tax assets quarterly to determine if adjustments to our
valuation allowance are required based on the consideration of all available positive and negative evidence using a “more likely
than not” standard with respect to whether deferred tax assets will be realized.  Our evaluation considers, among other factors,
our historical operating results, our expectation of future profitability, the duration of the applicable statutory carryforward
periods, and conditions in the housing market and the broader economy.  In our evaluation, we give more significant weight to
evidence that is objective in nature as compared to subjective evidence.  Also, more significant weight is given to evidence that
directly relates to our then-current financial performance as compared to indirect or less current evidence.  The ultimate
realization of our deferred tax assets depends primarily on our ability to generate future taxable income during the periods in
which the related deferred tax assets become deductible.  The value of our deferred tax assets depends on applicable income tax
rates.
Our deferred tax assets of $119.2 million at November 30, 2024 and $136.4 million at November 30, 2023 were partially
offset in each year by valuation allowances of $16.8 million and $16.9 million, respectively.  The deferred tax asset valuation
allowances at November 30, 2024 and 2023 were primarily related to certain state NOLs that had not met the “more likely than
not” realization standard at those dates.  As a result of our utilization of certain state NOLs, we reduced the valuation allowance
by $.1 million in 2024.  As of November 30, 2024, we would need to generate approximately $408.0 million of pretax income
in future periods before 2043 to realize our deferred tax assets.  Based on the evaluation of our deferred tax assets as of
November 30, 2024 and 2023, we determined that most of our deferred tax assets would be realized.
We will continue to evaluate both the positive and negative evidence on a quarterly basis in determining the need for a
valuation allowance with respect to our deferred tax assets.  The accounting for deferred tax assets is based upon estimates of
future results.  Changes in positive and negative evidence, including differences between estimated and actual results, could
result in changes in the valuation of our deferred tax assets that could have a material impact on our consolidated financial
statements.  Changes in existing federal and state tax laws and corporate income tax rates could also affect actual tax results and
the realization of deferred tax assets over time.
The majority of the tax benefits associated with our NOLs can be carried forward for 20 years and applied to offset future
taxable income.  Depending on their applicable statutory period, the state NOLs of $21.8 million, if not utilized, will begin to
expire between 2025 and 2043. No state NOLs expired in 2024 or 2023.  State NOLs of $.1 million expired in 2022. 
Unrecognized Tax Benefits.  Gross unrecognized tax benefits are the differences between a tax position taken or expected
to be taken in a tax return, and the benefit recognized for accounting purposes.  A reconciliation of the beginning and ending
balances of gross unrecognized tax benefits, including interest and penalties, is as follows (in thousands):
 
Years Ended November 30,
 
2024
2023
2022
Balance at beginning of year
$2,376
$975
$930
Increase related to prior years’ tax positions
546
1,401
45
Balance at end of year
$2,922
$2,376
$975
Our unrecognized tax benefits are included in accrued expenses and other liabilities in our consolidated balance sheets.  We
recognize accrued interest and penalties related to unrecognized tax benefits in our consolidated financial statements as a
component of the provision for income taxes.
If these unrecognized tax benefits reverse in the future, they would have a beneficial impact on our effective tax rate at that
time.  During the next 12 months, it is possible that the amount of unrecognized tax benefits will change, but we are not able to
provide a range of such change.  The potential change, if any, will be related to increases due to new tax positions taken and the
accrual of interest and penalties.  Our total accrued interest and penalties related to unrecognized income tax benefits was
approximately $.2 million at November 30, 2024 and approximately $.1 million at November 30, 2023.  Because of the impact
of deferred tax accounting, other than interest and penalties, the disallowance of the shorter deductibility period would not
affect our annual effective tax rate but would accelerate the payment of cash to a tax authority to an earlier period.  As of
November 30, 2024, the fiscal years ending 2021 and later remain open to federal examinations, while 2020 and later remain
open to state examinations.
The benefits of our deferred tax assets, including our NOLs, built-in losses and tax credits would be reduced or potentially
eliminated if we experienced an “ownership change” under Internal Revenue Code Section 382 (“Section 382”).  Based on our
analysis performed as of November 30, 2024, we do not believe that we have experienced an ownership change as defined by
Section 382, and, therefore, the NOLs, built-in losses and tax credits we have generated should not be subject to a Section 382
limitation as of this reporting date.