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INCOME TAXES
 9 Months Ended
Sep. 30, 2025
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The Company recorded income tax provision of $29,804 and $629 for the three months ended September 30, 2025 and 2024, respectively. The Company recorded income tax provision of $55,046 and $51 for the nine months ended September 30, 2025 and 2024, respectively.

Federal, state and local income tax returns for years prior to 2020 are no longer subject to examination by tax authorities. During the year 2024, federal tax authorities completed their audit of fiscal 2020. There were no proposed adjustments resulting from the examination.

In calculating the provision for income taxes on an interim basis, the Company uses an estimate of the annual effective tax rate based upon currently known facts and circumstances and applies that rate to its year-to-date earnings or losses. The Company’s estimated annual effective tax rate is based on expected income and statutory tax rates and takes into consideration permanent differences between financial statement and tax return income applicable to the Company in the various jurisdictions in which the Company operates. The effect of discrete items, such as changes in estimates, changes in enacted tax laws or rates or tax status, and unusual or infrequently occurring events, is recognized in the interim period in which the discrete item occurs. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the result of new judicial interpretations or regulatory or tax law changes. The Company's estimated annual effective tax rate, before any discrete items, was (32.5)% for the nine months ended September 30, 2025. The impact of discrete items was (13.5)% for the nine months ended September 30, 2025. The Company's interim effective tax rate for September 30, 2024, was (0.2)%.
The Company’s overall effective tax rate was affected by the elimination of the Up-C structure discussed in Note 1, which resulted in the Company owning 100% of Holdings and fair value adjustments for warrants and earnouts. At September 30, 2025 and December 31, 2024, the Company had $38,990 and $444 of income taxes payable, respectively. Income taxes payable are a component of accrued expenses in the consolidated balance sheet.

The Spin-Off resulted in a taxable gain to the Company related to the distribution of appreciated property which resulted in an increase in income tax expense.

On July 4, 2025, the One Big, Beautiful Bill Act (the “Act”) was signed into law. The Act includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. We evaluated the potential effects of the new legislation on our tax positions and financial reporting and believe it may have a material impact on our consolidated financial statements.
As discussed in Note 8, On September 8, 2025, the second and final phase of the Earnouts, was achieved. Upon achievement, 4,245,597 net shares were issued with a value of approximately $85.0 million. This resulted in an increase in amortizable tax goodwill and a related increase to the TRA liability and related deferred tax asset.