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Income Taxes
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
We have elected to be treated as a REIT under the provisions of the Internal Revenue Code, which requires that we distribute at least 90% of our taxable income annually to our stockholders and comply with certain other requirements. In addition to paying federal and state taxes on any retained income, we may be subject to taxes on “built in gains” on sales of certain assets. Our taxable REIT subsidiaries are subject to federal, state and local taxes.

For federal income tax purposes, the cash distributions paid to holders of our common stock and Series A Preferred Stock may be characterized as ordinary income, return of capital (generally non-taxable) or capital gains. Tax law permits certain characterization of distributions which could result in differences between cash basis and tax basis distribution amounts.

The following characterizes distributions paid to holders of common stock and Series A Preferred Stock on a tax basis for the years ended December 31, 2023, 2022, and 2021:


Year Ended December 31,
202320222021
Common Stock
Ordinary non-qualified income$0.120000 $0.044543 $— 
Qualified dividends— 0.045457 — 
$0.120000 $0.090000 $— 
Series A Preferred Stock
Ordinary non-qualified income$2.062500 $1.020772 $— 
Qualified dividends— 1.041728 — 
Return of capital— — 2.062500 
$2.062500 $2.062500 $2.062500 

Our provision for income taxes consists of the following (in thousands):
Year Ended December 31,
202320222021
Current - Federal$(84)$901 $2,759 
 State1,376 2,487 40 
1,292 3,388 2,799 
Deferred - Federal492 1,090 5,190 
 State(486)2,044 (6,159)
Change in valuation allowance(981)(3,915)1,437 
(975)(781)468 
Income tax provision$317 $2,607 $3,267 

A reconciliation of the statutory federal tax provision to our income tax provision is as follows (in thousands):
Year Ended December 31,
202320222021
Statutory federal tax provision (benefit)$18,226 $23,620 $(40,337)
Tax impact of REIT election(17,281)(21,110)45,946 
State income tax provision (benefit), net of federal tax benefit890 4,531 (6,119)
Change in valuation allowance(981)(3,915)1,437 
Permanent differences(349)(495)2,561 
Other(188)(24)(221)
Income tax provision$317 $2,607 $3,267 

Deferred income taxes are recognized for temporary differences between the financial reporting bases of assets and liabilities and their respective tax bases and for operating loss and tax credit carryforwards based on enacted tax rates expected to be in effect when such amounts are paid. However, deferred tax assets are recognized only to the extent that it is more likely than not that they will be realizable based on consideration of available evidence, including future reversals of existing taxable temporary differences, projected future taxable income and tax planning strategies. Deferred tax assets are included in prepaid and other assets and deferred tax liabilities are included in accounts payable and accrued expenses on the accompanying consolidated balance sheets. The total deferred tax assets and liabilities are as follows (in thousands):
20232022
Federal
Net operating loss carryforwards$2,585 $3,541 
Deferred income2,049 3,282 
Other407 511 
Depreciation and amortization(2,074)(3,808)
Less: Valuation allowance(1,766)(3,002)
Federal - Deferred tax assets (liabilities), net$1,201 $524 
State
Net operating loss carryforwards$8,921 $8,499 
Deferred income553 851 
Alternative minimum tax credit carryforwards231 211 
Other120 141 
Depreciation and amortization(559)(987)
Less: Valuation allowance(8,253)(7,999)
State - Deferred tax assets, net$1,013 $716 

As of December 31, 2023, we had deferred tax assets of $11.5 million consisting of federal and state net operating loss carryforwards. The state loss carryforwards generally expire in 2032 through 2041 if not utilized by then; however, for certain states some loss carryforwards do not expire. The federal loss carryforwards do not expire.
We analyze our deferred tax assets for each jurisdiction and record a valuation allowance when we deem it more likely than not that future results will not generate sufficient taxable income to realize the deferred tax assets. As of December 31, 2023, we have a valuation allowance of $10.0 million on our deferred tax assets, which represents the amount of deferred tax assets that we believe is more likely than not to be realized. Our assessment included, among other considerations, the future reversals of existing taxable temporary differences and future taxable income that can be reasonably projected.