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Income Tax | 6 Months Ended
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Jun. 30, 2022
Income Tax Disclosure [Abstract] |
Income Tax | Income Tax The components of income tax expense for the three and six months ended June 30, 2022 and 2021, respectively, consisted of the following:
|  | Three months ended June 30, |  | Six months ended June 30,
(In thousands) |  | 2022 |  | 2021 |  | 2022 |  | 2021
Current tax provision |  | $ | 8,196 |  |  | $ | 2,689 |  |  | $ | 15,073 |  |  | $ | 8,287 |
Deferred tax benefit |  | (508) |  |  | (57) |  |  | (1,210) |  |  | (947) |
Income tax expense |  | $ | 7,688 |  |  | $ | 2,632 |  |  | $ | 13,863 |  |  | $ | 7,340 |
The Company conducts operations in Puerto Rico, the United States, and certain countries in Latin America. As a result, the income tax expense includes the effect of taxes paid to the government of Puerto Rico as well as foreign jurisdictions. The following table presents the components of income tax expense for the three and six months ended June 30, 2022 and 2021, and its segregation based on location of operations:
|  | Three months ended June 30, |  | Six months ended June 30,
(In thousands) |  | 2022 |  | 2021 |  | 2022 |  | 2021
Current tax provision (benefit) |  |  |  |  |  |  |  |
Puerto Rico |  | $ | 3,176 |  |  | $ | (569) |  |  | $ | 5,491 |  |  | $ | 1,035 |
United States |  | 33 |  |  | 45 |  |  | 63 |  |  | 75 |
Foreign countries |  | 4,987 |  |  | 3,213 |  |  | 9,519 |  |  | 7,177 |
Total current tax provision |  | $ | 8,196 |  |  | $ | 2,689 |  |  | $ | 15,073 |  |  | $ | 8,287 |
Deferred tax (benefit) provision |  |  |  |  |  |  |  |
Puerto Rico |  | $ | (647) |  |  | $ | (226) |  |  | $ | (1,040) |  |  | $ | (520) |
United States |  | 26 |  |  | 242 |  |  | (45) |  |  | (187) |
Foreign countries |  | 113 |  |  | (73) |  |  | (125) |  |  | (240) |
Total deferred tax benefit |  | $ | (508) |  |  | $ | (57) |  |  | $ | (1,210) |  |  | $ | (947) |
Taxes payable to foreign countries by EVERTEC’s subsidiaries will be paid by such subsidiary and the corresponding liability and expense will be presented in EVERTEC’s consolidated financial statements. As of June 30, 2022, the Company has $113.5 million of unremitted earnings from foreign subsidiaries, compared to $99.1 million as of December 31, 2021. The Company has not recognized a deferred tax liability on undistributed earnings for the Company’s foreign subsidiaries because these earnings are intended to be indefinitely reinvested. As of June 30, 2022, the gross deferred tax asset amounted to $19.8 million and the gross deferred tax liability amounted to $13.5 million, compared to $22.3 million and $16.3 million, respectively, as of December 31, 2021. As of June 30, 2022, and December 31, 2021, there is a valuation allowance against the gross deferred tax asset of approximately $1.3 million and $1.4 million, respectively. The Company estimates that it is reasonably possible that the Puerto Rico liability for uncertain tax positions relating to the net operating loss created by transaction costs from mergers and acquisitions will decrease by approximately $3.6 million during 2022 as a result of the statute of limitations. Income tax expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:
|  | Six months ended June 30,
(In thousands) |  | 2022 |  | 2021
Computed income tax at statutory rates |  | $ | 32,357 |  |  | $ | 34,513 |
Differences in tax rates due to multiple jurisdictions |  | 1,155 |  |  | 960 |
Effect of income subject to tax-exemption grant |  | (20,440) |  |  | (23,863) |
Unrecognized tax (benefit) expense |  | 122 |  |  | (3,580) |
Excess tax benefits on share-based compensation |  | (21) |  |  | (976) |
Other, net |  | 690 |  |  | 286 |
Income tax expense |  | $ | 13,863 |  |  | $ | 7,340 |

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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 https://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 https://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 https://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 https://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 https://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 https://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 https://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 https://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 https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
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