The United States and foreign components of income before income taxes and equity in earnings in affiliates are as follows:


	2023		2022		2021
	(In thousands)
Income before income taxes and equity in earnings in affiliates
United States	$	125,495	$	205,360	$	161,856
Foreign		12,553		24,460		30,966
Income before income taxes and equity in earnings in affiliates	$	138,048	$	229,820	$	192,822

The provision for income taxes consists of the following components:


	2023			2022			2021
	(In thousands)
Federal income taxes:
Current	$	23,107		$	25,699		$	20,006
Deferred		1,256			17,328			71,202
		24,363			43,027			91,208
State income taxes:
Current		6,139			10,422			8,564
Deferred		766			3,960			18,587
		6,905			14,382			27,151
Foreign income taxes (benefit):
Current		4,677			39,904			7,780
Deferred		(546	)		(34,414	)		(3,409	)
		4,131			5,490			4,371
Total U.S. and foreign provision for income taxes	$	35,399		$	62,899		$	122,730

A reconciliation of the statutory U.S. federal tax rate of 21% and the effective income tax rate is as follows:


	2023			2022			2021
	(In thousands)
Provisions using statutory federal income tax rate	$	28,990		$	48,262		$	40,492
State income taxes, net of federal tax benefit		8,221			12,738			7,921
Change in valuation allowance		(3,292	)		(242	)		389
Federal tax credits		(1,733	)		(1,742	)		(1,414	)
Effect of tax rate differential in foreign jurisdictions		1,137			1,932			3,802
Tax impact of vested equity compensation		981			2,100			3,621
Impact of REIT termination		—			—			70,813
Change in contingent tax liability		27			452			(4,339	)
Asset divestiture		(1,529	)		(5,596	)		—
Other, net		2,597			4,995			1,445
Total provision for income taxes	$	35,399		$	62,899		$	122,730

The Company's effective tax rate differs from the U.S. statutory rate of 21% primarily due to the tax benefit from the release of valuation allowance of $3.3 million on certain state net operating losses in 2023, lower taxes on an asset divestiture in 2023 and 2022 of $1.5 million and $5.6 million, respectively, and non-cash tax expense related to the termination of the REIT status in 2021 of $70.8 million. Additionally, taxes differ due to state income taxes and foreign income taxes in excess of the US statutory rate in the presented periods. State income taxes, net of federal tax benefits of $8.2 million, $12.7 million and $7.9 million were incurred in 2023, 2022 and 2021, respectively.

The following table presents the breakdown between non-current net deferred tax assets as classified on the balance sheets as of December 31, 2023 and 2022:


	2023			2022
	(In thousands)
Deferred tax assets - non-current	$	8,551		$	8,005
Deferred tax liabilities - non-current		(77,369	)		(75,849	)
Total net deferred tax assets	$	(68,818	)	$	(67,844	)

The significant components of the Company's deferred tax assets and liabilities consisted of the following as of December 31, 2023 and 2022:


	2023			2022
Deferred tax assets:	(In thousands)
Net operating losses	$	16,492		$	17,457
Accrued liabilities		20,408			34,333
Deferred compensation		16,812			14,437
Accrued compensation		9,485			6,928
Deferred revenue		1,446			1,654
Tax credits		3,376			4,423
Equity awards		3,537			3,322
Operating lease liability		26,627			23,556
Other, net		884			910
Valuation allowance		(19,105	)		(21,016	)
Total deferred tax assets	$	79,962		$	86,004
Deferred tax liabilities:
Depreciation	$	(81,949	)	$	(85,402	)
Intangible assets		(41,329	)		(46,228	)
Prepaid expenses and other		(16	)		(16	)
Lease right-of-use assets		(25,486	)		(22,202	)
Total deferred tax liabilities	$	(148,780	)	$	(153,848	)

Total net deferred tax assets (liabilities)	$	(68,818	)	$	(67,844	)

Deferred income taxes should be reduced by a valuation allowance if it is not more likely than not that some portion or all of the deferred tax assets will be realized. On a periodic basis, management evaluates and determines the amount of the valuation allowance required and adjusts such valuation allowance accordingly. At year end 2023 and 2022, the Company has a valuation allowance of $19.1 million and $21.0 million, respectively related to deferred tax assets for foreign net operating losses and foreign tax credits, state net operating losses and state tax credits. The valuation allowance decreased by $1.9 million during the year ended December 31, 2023 related to certain deferred tax assets that were realized.

The Company provides income taxes on the undistributed earnings of non-U.S. subsidiaries except to the extent that such earnings are permanently invested outside the United States. At December 31, 2023, $9.1 million of accumulated undistributed earnings of non-U.S. subsidiaries were permanently invested outside the United States. At the existing U.S. federal income and applicable foreign withholding tax rates, additional taxes (net of foreign tax credits) of $0.5 million, consisting solely of withholding taxes, would have to be provided if such earnings were remitted currently.

At December 31, 2023, the Company had no Federal net operating loss carryforwards and $184.4 million of combined net operating loss carryforwards in various states which will begin to expire in 2024. The Company has recorded a partial valuation allowance against the deferred tax assets related to the state operating losses.

Also, as of the year ended December 31, 2023, the Company had $15.8 million of foreign net operating losses and $0.3 million foreign capital losses which carry forward indefinitely and $1.1 million of state tax credits which will begin to expire in 2024. The Company has recorded a partial valuation allowance against the deferred tax assets related to the foreign operating losses and state tax credits.

The Company recognizes the cost of employee services received in exchange for awards of equity instruments based upon the grant date fair value of those awards. The exercise of non-qualified stock options and vesting of restricted stock awards which have been granted under

the Company’s equity award plans give rise to compensation income which is includable in the taxable income of the applicable employees and the majority of which is deductible by the Company for federal and state income tax purposes. In the case of non-qualified stock options, the compensation income results from increases in the fair market value of the Company's common stock subsequent to the date of grant. At December 31, 2023, the deferred tax asset related to unexercised stock options and restricted stock grants for which the Company has recorded a book expense was $3.5 million.

The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:


	2023			2022			2021
	(In thousands)
Balance at Beginning of Period	$	1,520		$	1,105		$	5,623
Additions based on tax positions related to the current year		—			581			133
Additions for tax positions of prior years		75			57			57
Reductions as a result of a lapse of applicable statutes of limitations		(57	)		(223	)		(4,708	)
Balance at End of Period	$	1,538		$	1,520		$	1,105

All amounts in the reconciliation are reported on a gross basis and do not reflect a federal tax benefit on state income taxes. The Company has accrued $1.5 million of accrued uncertain tax benefits as of December 31, 2023 which is inclusive of the federal tax benefit on state income taxes. The Company believes that it is reasonably possible that a decrease may be necessary in the unrecognized tax benefits within twelve months of the reporting date of approximately $0.1 million, related to tax exposures, due to a lapse of the statute of limitation. The accrued uncertain tax balance at December 31, 2023 includes $1.5 million of unrecognized tax benefits which, if ultimately recognized, will reduce the Company’s annual effective tax rate.

The Company is subject to income taxes in the U.S. federal jurisdiction, and various states and foreign jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for the years before 2019.

The calculation of the Company’s provision (benefit) for income taxes requires the use of significant judgment and involves dealing with uncertainties in the application of complex tax laws and regulations. In determining the adequacy of the Company’s provision (benefit) for income taxes, potential settlement outcomes resulting from income tax examinations are regularly assessed. As such, the final outcome of tax examinations, including the total amount payable or the timing of any such payments upon resolution of these issues, cannot be estimated with certainty.

During the year ended December 31, 2023, the Company recognized a net increase in interest of $0.3 million related to the

unrecognized tax benefits noted in the table above. There was no potential penalty recorded during the year ended December 31, 2023. The net decrease in interest during the year ended December 31, 2022 was not significant. During the year ended December 31, 2022, the Company recorded a potential penalty of $0.1 million. During the year ended December 31, 2021, the Company recognized a net decrease in interest expense of $0.2 million related to the change of unrecognized tax benefits noted in the table above. There was no potential penalty recorded during the year ended December 31, 2021.

The Company has approximately $0.4 million accrued for the payment of interest and penalties at December 31, 2023. The Company had approximately $0.1 million accrued for the payment of interest and penalties at December 31, 2022. The amount accrued for the payment of interest and penalties was not significant at December 31, 2021. The Company classifies interest and penalties as interest expense and operating expense, respectively.