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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Provision for Income Taxes

The provision for income taxes consists of the following:

			Year Ended December 31,
(in millions)			2020			2019			2018
Current:
Federal			$	96		$	53		$	41
State			30			12			7
Foreign			1			—			—
Total Current			127			65			48
Deferred:
Federal			(33)			(2)			(3)
State			(9)			(5)			4
Total Deferred			(42)			(7)			1
Total			$	85		$	58		$	49

U.S. Federal Statutory Income Tax Rate Reconciled to Effective Tax Rate

The U.S. federal statutory income tax rate reconciled to our effective tax rate is as follows:

			Year Ended December 31,
			2020									2019									2018
(in millions, except percent)			Pre-Tax Income			Tax Expense/(Benefit)			Percent of Pre-Tax Income (Loss)			Pre-Tax Income			Tax Expense/(Benefit)			Percent of Pre-Tax Income (Loss)			Pre-Tax Income			Tax Expense/(Benefit)			Percent of Pre-Tax Income (Loss)
			$	357								$	270								$	241
U.S. federal statutory tax rate						$	75		21		%				$	57		21		%				$	51		21		%
State income taxes, net of federal benefit						25			7						20			7						18			8
Nondeductible meals, entertainment and penalties						—			—						1			—						1			—
Stock based compensation						(2)			—						(1)			—						(9)			(4)
Uncertain tax positions						1			—						—			—						1			—
Tax credits						(6)			(2)						(7)			(3)						(5)			(2)
State and tax return to provision adjustments						(7)			(2)						(8)			(3)						(7)			(3)
Sec 199 benefits						—			—						(1)			—						—			—
Other						(1)			—						(3)			(1)						(1)			—
Total						$	85		24		%				$	58		21		%				$	49		20		%

Significant Components of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities are as follows:

			Year Ended December 31,
(in millions)			2020			2019
Deferred tax assets:
Net operating losses (federal and state)			$	3		$	3
Accrued expenses			14			8
Accrued workers' compensation costs			9			9
Recovery credit			26			—
Operating lease liabilities			15			17
Stock based compensation			3			3
Tax benefits relating to uncertain positions			1			1
Tax credits (federal and state)			8			7
Total			79			48
Valuation allowance			(5)			(5)
Total deferred tax assets			74			43
Deferred tax liabilities:
Depreciation and amortization			(37)			(27)
Deferred service revenues			(20)			(41)
Prepaid commission expenses			(22)			(19)
Operating lease right-of-use assets			(13)			(15)
Other			(2)			(1)
Total deferred tax liabilities			(94)			(103)
Net deferred tax liabilities			$	(20)		$	(60)

Reconciliation of Beginning and Ending Valuation Allowance

A reconciliation of the beginning and ending amount of the valuation allowance is presented in the table below:

			Year Ended December 31,
(in millions)			2020			2019			2018
Valuation allowance at January 1			$	5		$	7		$	7
Credited/ charged to net income			—			(2)			—
Valuation allowance at December 31			5			5			7

Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits (excluding interest and penalties) is presented in the table below:

			Year Ended December 31,
(in millions)			2020			2019			2018
Unrecognized tax benefits at January 1			$	7		$	6		$	6
Additions for tax positions of prior periods			1			1			1
Additions for tax positions of current period			1			1			—
Reductions for tax positions of prior period:
Settlements with taxing authorities			(1)			—			—
Lapse of applicable statute of limitations			—			(1)			(1)
Unrecognized tax benefits at December 31			$	8		$	7		$	6

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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