Income Taxes

12 Months Ended

Dec. 31, 2020

9. Income Taxes

The current and deferred federal and state income tax provision from continuing operations, are comprised of the following:

	December 31,
	2020			2019			2018
	(Amounts in Thousands)
Current
Federal	$	10,230		$	5,876		$	2,883
State		3,312			2,442			1,562
Deferred
Federal		(3,690	)		(734	)		(265	)
State		(1,043	)		(225	)		(84	)
Provision for income taxes	$	8,809		$	7,359		$	4,096

The tax effects of certain temporary differences between the Company’s book and tax bases of assets and liabilities give rise to significant portions of the deferred income tax assets (liabilities) at December 31, 2020 and 2019. The deferred tax assets (liabilities) consisted of the following:

	December 31,
	2020			2019
	(Amounts in Thousands)
Deferred tax assets
Long-term
Accounts receivable allowances	$	14,023		$	9,256
Accrued compensation		3,580			2,765
Accrued workers’ compensation		3,220			3,327
Transaction costs		1,677			1,311
Restructuring costs		108			135
Stock-based compensation		833			793
Government stimulus advances		1,933			—
Operating lease liabilities		12,123			5,896
Other		1,269			584
Total long-term deferred tax assets		38,766			24,067
Deferred tax liabilities
Long-term
Goodwill and intangible assets		(18,891	)		(15,079	)
Property and equipment		(3,217	)		(1,037	)
Prepaid insurance		—			(534	)
Operating lease assets, net		(10,052	)		(5,606	)
Other		(82	)		(164	)
Total long-term deferred tax liabilities		(32,242	)		(22,420	)
Valuation allowance		—			—
Total net deferred tax assets	$	6,524		$	1,647

Management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers all available evidence in making this assessment.

A reconciliation for continuing operations of the statutory federal tax rate of 21.0% to the effective income tax rate, for the years ended December 31, 2020, 2019 and 2018, is summarized as follows:

	December 31,
	2020				2019				2018
Federal income tax at statutory rate		21.0		%		21.0		%		21.0		%
State and local taxes, net of federal benefit		6.0				6.4				6.3
Jobs tax credits, net		(5.1	)			(8.3	)			(10.7	)
162(m) disallowance for executive compensation		6.0				7.5				4.5
Nondeductible permanent items		0.4				0.7				2.2
Nondeductible penalties		—				1.3				—
Excess tax benefit		(5.6	)			(6.7	)			(2.7	)
Federal/state return to provision		(1.6	)			0.6				0.2
Other		(0.1	)			(0.3	)			(0.7	)
Effective income tax rate		21.0		%		22.2		%		20.1		%

The effective income tax rate was 21.0%, 22.2% and 20.1% for the years ended December 31, 2020, 2019 and 2018, respectively. The difference between our federal statutory and effective income tax rates is principally due to the inclusion of state taxes and non-deductible compensation, offset by an excess tax benefit and the use of federal employment tax credits.

The Company is subject to taxation in the jurisdictions in which it operates. The Company continues to remain subject to examination by U.S. federal authorities for the years 2017 through 2019 and for various state authorities for the years 2015 through 2019.

- 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.

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