XML 39 R25.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes We are organized and conduct our operations to qualify as a REIT and to comply with the provisions of the Internal Revenue Code. A REIT is generally not subject to federal income tax on taxable income which it distributes to its stockholders, provided that it distributes at least 90% of its REIT–taxable income and meets certain other requirements. Certain REIT income may be subject to state and local income taxes. We did not have any REIT–federal taxable income, net of dividends paid and net operating loss deductions, for 2023, 2022 and 2021, and therefore, have not provided for REIT federal income tax expense in any of those years. In 2023, 2022 and 2021, the REIT incurred no state income tax expense. We have elected to retain excess inclusion income rather than passing it through to our stockholders. Certain of our assets and operations that would not otherwise comply with the REIT requirements, such as the Agency Business and our residential mortgage banking joint venture, are owned or conducted through our TRS Consolidated Group, the majority of the income of which is subject to U.S. federal, state and local income taxes. The TRS Consolidated Group had no federal net operating losses remaining from prior years. For 2023, 2022 and 2021, we recorded a provision for income taxes related to the assets held in the TRS Consolidated Group and the REIT in the amount of $27.3 million, $17.5 million and $46.3 million, respectively. In 2023, the change in the valuation allowance previously recorded at the TRS Consolidated Group on the deferred tax assets was released in the amount of $0.3 million. In 2022, the change in the valuation allowance previously recorded at the TRS Consolidated Group on the deferred tax assets was due to the impact of state tax rate changes. In 2021, valuation allowance previously recorded at the TRS Consolidated Group on the deferred tax assets subject to loss limitation rules was released in the amount of $0.1 million. A summary of our pre-tax GAAP income is as follows (in thousands):
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
Pre‑tax GAAP income: |  |  |  |  |
REIT | $ | 320,045 |  |  | $ | 303,320 |  |  | $ | 239,356 |
TRS Consolidated Group | 107,858 |  |  | 67,991 |  |  | 184,736 |
Total pre‑tax GAAP income | $ | 427,903 |  |  | $ | 371,311 |  |  | $ | 424,092 |
Our provision for income taxes is comprised as follows (in thousands):
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
Current tax provision: |  |  |  |  |
Federal | $ | 26,269 |  |  | $ | 14,167 |  |  | $ | 27,454 |
State | 8,427 |  |  | 5,058 |  |  | 7,939 |
Total | 34,696 |  |  | 19,225 |  |  | 35,393 |
Deferred tax (benefit) provision: |  |  |  |  |
Federal | $ | (5,272) |  |  | $ | (1,373) |  |  | $ | 8,287 |
State | (1,783) |  |  | (370) |  |  | 2,744 |
Valuation allowance | (294) |  |  | 2 |  |  | (139) |
Total | (7,349) |  |  | (1,741) |  |  | 10,892 |
Total income tax expense | $ | 27,347 |  |  | $ | 17,484 |  |  | $ | 46,285 |
A reconciliation of our effective income tax rate as a percentage of pre-tax income to the U.S. federal statutory rate is as follows:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
U.S. federal statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
REIT non‑taxable income | (15.7) | % |  | (17.2) | % |  | (11.9) | %
State and local income taxes, net of federal tax benefit | 1.2 | % |  | 1.0 | % |  | 2.0 | %
Other | (0.1) | % |  | (0.1) | % |  | (0.2) | %
Effective income tax rate | 6.4 | % |  | 4.7 | % |  | 10.9 | %
The significant components of our deferred tax assets and liabilities of our TRS Consolidated Group are as follows (in thousands):
| December 31,
| 2023 |  | 2022
Deferred tax assets: |  |  |
Expenses not currently deductible | $ | 27,144 |  |  | $ | 22,755 |
Loan loss reserves | 7,088 |  |  | 7,159 |
Net operating and capital loss carryforwards | 188 |  |  | 454 |
Valuation allowance | — |  |  | (294) |
Other | 346 |  |  | 441 |
Deferred tax assets, net | $ | 34,766 |  |  | $ | 30,515 |
Deferred tax liabilities: |  |  |
Mortgage servicing rights | $ | 28,286 |  |  | $ | 26,975 |
Intangibles | 5,565 |  |  | 6,457 |
Interest in equity affiliates—net | 2,719 |  |  | 6,237 |
Deferred tax liabilities, net | $ | 36,570 |  |  | $ | 39,669 |
At both December 31, 2023 and 2022, the REIT (excluding the TRS Consolidated Group) had no federal net operating loss carryforwards and no capital loss carryforwards. At both December 31, 2023 and 2022, the TRS Consolidated Group had no federal net operating loss carryforwards remaining. During 2023, the TRS Consolidation Group utilized in full its capital loss carryforward of approximately $1.1 million. At both December 31, 2023 and 2022, the TRS Consolidated Group had state net operating loss carryforwards of $0.2 million, which will begin to expire in 2036. The TRS Consolidated Group is currently under audit in certain state and local jurisdictions for tax years 2017-2021. While the impact of the current income tax examinations were undetermined, it is not expected to be material to our consolidated financial statements. We have assessed our tax positions for all open years, which includes 2017-2023, and have concluded that there were no material uncertainties to be recognized. We have not recognized any interest and penalties related to tax uncertainties for the years ended 2017 through 2023.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration