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Note 8 - Income Taxes Concept
 12 Months Ended
Dec. 31, 2023
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

Note 8 – Income Taxes

 

The components of Income before income taxes are:

 

   

2023

    

2022

    

2021

  

United States

   $ 34,763     $ 6,270     $ 30,973  

Foreign countries

     9,198       7,602       6,275  

Total

   $ 43,961     $ 13,872     $ 37,248  

 

 

The components of income tax expense are:

 

   

2023

    

2022

    

2021

  

Current expense:

                        

Federal

   $ 6,735     $ 1,581     $ 5,174  

Foreign

     1,591       1,264       1,087  

State and local

     1,098       918       1,086  
    $ 9,424     $ 3,763     $ 7,347  

Deferred expense (benefit):

                        

Federal

   $ (206 )   $ (565 )   $ 60  

Foreign

     196       147       48  

State and local

     (404 )     (668 )     (58 )
      (414 )     (1,086 )     50  

Income tax expense

   $ 9,010     $ 2,677     $ 7,397  

 

The reconciliation between income tax expense and the amount computed by applying the statutory federal income tax rate to income before income taxes is:

 

   

2023

    

2022

    

2021

  

Income taxes at statutory rate

   $ 9,232     $ 2,913     $ 7,822  

State and local income taxes, net of federal tax benefit

     620       282       898  

Tax credits

     (1,208 )     (627 )     (1,052 )

Uncertain tax positions

     (34 )     (99 )     (26 )

Valuation allowance

     (72 )     (85 )     (86 )

GILTI/FDII

     368       608       238  

Foreign rate differential

     (145 )     (186 )     (183 )

Other

     249       (129 )     (214 )

Income tax expense

   $ 9,010     $ 2,677     $ 7,397  

 

The Company made income tax payments of $7.9 million, $4.5 million, and $7.9 million in 2023, 2022, and 2021, respectively.

 

 

Deferred income tax assets and liabilities consist of:

 

   

2023

    

2022

  

Deferred tax assets:

                

Inventories

   $ 520     $ 524  

Accrued liabilities

     3,011       3,208  

Postretirement health benefits obligation

     5,600       5,584  

Pension

     2,386       1,868  

Lease liabilities

     4,916       520  

Capitalized R&D

     2,041       1,103  

Interest

     8,703       3,168  

Other

     1,155       1,399  

Total deferred tax assets

     28,332       17,374  

Valuation allowance

     (390 )     (462 )

Net deferred tax assets

     27,942       16,912  

Deferred tax liabilities

                

Depreciation and amortization

     (22,923 )     (16,987 )

Leases - right of use assets

     (4,922 )     (536 )

Total deferred tax liabilities

     (27,845 )     (17,523 )

Net deferred tax assets (liabilities)

   $ 97     $ (611 )

 

 

The Company had state tax credit carryforwards of $0.3 million and $0.4 million as of December 31, 2023 and 2022, respectively, which will expire incrementally between 2024 and 2036.

 

The Company had valuation allowances of $0.4 million at December 31, 2023 and $0.5 million at December 31, 2022, against certain of its deferred tax assets. ASC 740, “Income Taxes,” requires that a valuation allowance be recorded against deferred tax assets when it is more likely than not that some or all of a Company’s deferred tax assets will not be realized based on available positive and negative evidence.

 

Total unrecognized tax benefits were $0.7 million at December 31, 2023 and $0.8 million at December 31, 2022. The total amount of unrecognized tax benefits that, if ultimately recognized, would reduce the Company’s annual effective tax rate were $0.6 million at December 31, 2023 and 2022. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense for all periods presented. The Company accrued approximately $0.2 million for the payment of interest and penalties at each of December 31, 2023, 2022 and 2021.

 

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

 

   

2023

    

2022

    

2021

  

Balance at beginning of year

   $ 754     $ 808     $ 878  

Additions based on tax positions related to the current year

     180       117       153  

Reductions due to lapse of applicable statute of limitations

     (230 )     (171 )     (96 )

Settlements

     -       -       (127 )

Balance at end of year

   $ 704     $ 754     $ 808  

 

The Company is subject to income taxes in the U.S. federal and various state, local and foreign jurisdictions. Income tax regulations within each jurisdiction are subject to the interpretation of the related tax laws and regulations and require significant judgment to apply. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for the years before 2018.