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Income Taxes | 12 Months Ended
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Dec. 31, 2021
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES For financial reporting purposes, income from continuing operations before income taxes includes the following components (in thousands):
| 2021 |  | 2020 |  | 2019
United States | $ | 92,847 |  |  | $ | 103,306 |  |  | $ | 92,710 |
Foreign (Canada) | 193 |  |  | 182 |  |  | 179 |
Total | $ | 93,040 |  |  | $ | 103,488 |  |  | $ | 92,889 |
Income tax expense (benefit) included in the accompanying Consolidated Statements of Comprehensive Income for the years ended December 31, 2021, 2020 and 2019 was as follows (in thousands):
| 2021 |  | 2020 |  | 2019
Continuing operations: |  |  |  |  |
Current: |  |  |  |  |
Federal | $ | 12,369 |  |  | $ | 21,926 |  |  | $ | 12,776 |
Foreign | 52 |  |  | 78 |  |  | 48 |
State and local | 3,397 |  |  | 5,584 |  |  | 4,110 |
Total | 15,818 |  |  | 27,588 |  |  | 16,934 |
Deferred: |  |  |  |  |
Federal | 5,029 |  |  | (1,968) |  |  | 3,685 |
State and local | 1,282 |  |  | (479) |  |  | 1,221 |
Total | 6,311 |  |  | (2,447) |  |  | 4,906 |
Total income tax expense from continuing operations | 22,129 |  |  | 25,141 |  |  | 21,840 |
Discontinued operations: |  |  |  |  |
Operations of discontinued operations: |  |  |  |  |
Current | (5) |  |  | (11) |  |  | (107) |
Deferred | — |  |  | — |  |  | (1) |
Total income tax expense from discontinued operations | (5) |  |  | (11) |  |  | (108) |
Total income tax expense | $ | 22,124 |  |  | $ | 25,130 |  |  | $ | 21,732 |
The provision for income taxes attributable to income from continuing operations differed from the amount obtained by applying the federal statutory income tax rate to income from continuing operations before income taxes, as follows (in thousands, except percentages):
| 2021 |  | 2020 |  | 2019
Tax at U.S. federal statutory rates | $ | 19,538 |  |  | $ | 21,733 |  |  | $ | 19,507 |
State taxes (net of federal benefit) | 4,498 |  |  | 5,354 |  |  | 4,774 |
Business meals and entertainment — non-deductible | 190 |  |  | 458 |  |  | 987 |
Change in valuation allowance | 435 |  |  | 176 |  |  | 932 |
Reserves for uncertain tax positions | (104) |  |  | (1,290) |  |  | (263) |
Share-based compensation | (4,187) |  |  | (2,394) |  |  | (4,773) |
Non-deductible expenses | 1,408 |  |  | 787 |  |  | 713 |
Other, net | 351 |  |  | 317 |  |  | (37) |
Provision for income taxes from continuing operations | $ | 22,129 |  |  | $ | 25,141 |  |  | $ | 21,840 |
Effective income tax rate | 23.8 | % |  | 24.3 | % |  | 23.5 | %
The tax effects of temporary differences that gave rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2021 and 2020, were as follows (in thousands):
| 2021 |  | 2020
Deferred tax assets: |  |  |
Net operating loss carryforwards | $ | 1,202 |  |  | $ | 1,249 |
Allowance for doubtful accounts | 3,613 |  |  | 3,288 |
Employee benefits and compensation | 33,549 |  |  | 30,151 |
Lease costs | 5,726 |  |  | 6,291 |
State tax credit carryforwards | 189 |  |  | 1,291 |
Deferral of employer FICA taxes | 1,961 |  |  | 3,983 |
Other deferred tax assets | 589 |  |  | 424 |
Total gross deferred tax assets | 46,829 |  |  | 46,677 |
Less: valuation allowance | (2,046) |  |  | (2,663) |
Total deferred tax assets, net | 44,783 |  |  | 44,014 |
Deferred tax liabilities: |  |  |
Client list intangible assets | 250 |  |  | 524 |
Goodwill and other intangibles | 57,740 |  |  | 49,680 |
Property and equipment | 1,488 |  |  | 2,071 |
Other deferred tax liabilities | 745 |  |  | 491 |
Total gross deferred tax liabilities | 60,223 |  |  | 52,766 |
Deferred income taxes, net | $ | (15,440) |  |  | $ | (8,752) |
We have established valuation allowances for deferred tax assets related to certain employee benefits and compensation, state net operating loss (“NOL”) carryforwards and state income tax credit carryforwards at December 31, 2021 and December 31, 2020. The net decrease in the valuation allowance of $0.6 million for the year ended December 31, 2021 primarily related to changes in the valuation allowance for NOLs and state tax credit carryforwards. In assessing the realization of deferred tax assets, management considers all available positive and negative evidence, including projected future taxable income, scheduled reversal of deferred tax liabilities, historical financial operations and tax planning strategies. Based upon review of these items, management believes it is more-likely-than-not that the Company will realize the benefits of these deferred tax assets, net of the existing valuation allowances. We file income tax returns in the United States, Canada, and most state jurisdictions. CBIZ's federal income tax returns for years ending prior to January 1, 2018 are no longer subject to examination. With limited exceptions, our state and local income tax returns and non-U.S. income tax returns are no longer subject to tax authority examinations for years ending prior to January 1, 2017 and January 1, 2016, respectively. The availability of NOLs and state tax credits are reported as deferred tax assets, net of applicable valuation allowances, in the accompanying Consolidated Balance Sheets. At December 31, 2021, we had state net operating loss carryforwards of $36.4 million and a state tax credit carryforward of $0.2 million. The state net operating loss carryforwards expire on various dates between 2022 and 2041 and the state tax credit carryforward expires on various dates between 2022 and 2029. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):
| 2021 |  | 2020 |  | 2019
Balance at January 1 | $ | 1,536 |  |  | $ | 2,536 |  |  | $ | 2,819 |
Additions for tax positions of the current year | 161 |  |  | 150 |  |  | 145 |
Additions for positions of prior years | 400 |  |  | — |  |  | — |
Settlements of prior year positions | (374) |  |  | — |  |  | (282) |
Lapse of statutes of limitation | (129) |  |  | (1,150) |  |  | (146) |
Balance at December 31 | $ | 1,594 |  |  | $ | 1,536 |  |  | $ | 2,536 |
Included in the balance of unrecognized tax benefits at December 31, 2021 are $1.0 million of unrecognized tax benefits that, if recognized, would affect the effective tax rate. We believe it is reasonably possible that certain of these unrecognized tax benefits could change in the next twelve months. We expect reductions in the liability for unrecognized tax benefits of approximately $0.1 million within the next twelve months due to expiration of statutes of limitation. Given the number of years that are currently subject to examination, we are unable to estimate the range of potential adjustments to the remaining balance of unrecognized tax benefits at this time. We recognize interest expense, and penalties related to unrecognized tax benefits as a component of income tax expense. During 2021, we recorded a decrease of $0.2 million in accrued interest, and, as of December 31, 2021, we had recognized a liability for interest expense and penalties of $0.2 million and $0.2 million, respectively, relating to unrecognized tax benefits. During 2020, we recorded an immaterial decrease in accrued interest, and, as of December 31, 2020, we had recognized a liability for interest expense and penalties of $0.4 million and $0.2 million, respectively, relating to unrecognized tax benefits.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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