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Income Taxes

12 Months Ended

Dec. 31, 2024

Income Taxes

Income Taxes

​

Note 10: Income Taxes

For financial reporting purposes, income before income taxes includes the following components:

​

​	​	​	​	​	​	​	​	​	​
Years ended December 31,		2024			2023			2022
(in thousands)	​	​	​	​	​	​	​	​	​
United States	​	$	102,415	​	$	253,407	​	$	287,987
Foreign	​		10,387	​		2,836	​		1,645
Income before income taxes	​	$	112,802	​	$	256,243	​	$	289,632

​

The following table lists the components of the provision for income taxes:

​

​	​	​	​	​	​	​	​	​	​
Years ended December 31,		2024			2023			2022
(in thousands)	​	​	​	​	​	​	​	​	​
Current provision:	​		​	​		​	​		​
Federal	​	$	11,468	​	$	45,146	​	$	47,744
State	​		2,310	​		6,502	​		3,164
Foreign	​		681	​		835	​		865
Deferred provision (Benefit):	​		​	​		​	​		​
Federal	​		8,067	​		7,116	​		14,026
State	​		1	​		1,531	​		5,470
Foreign	​	​	(1,169)	​	​	—	​	​	—
Total income tax provision	​	$	21,358	​	$	61,130	​	$	71,269

​

The Organization for Economic Co-operation and Development (OECD) has released the Base Erosion and Profit Shifting framework 2.0 (Pillar Two) to introduce a global minimum corporate tax of 15% for companies with global revenues and profits above certain thresholds. As of December 31, 2024, certain countries we operate in have enacted legislation related to the global minimum tax rules under Pillar Two. The United States has not yet enacted legislation to adopt Pillar Two. There are no recorded effects for Pillar Two in our 2024 financial statements as we do not estimate a material impact, if any, to our consolidated financial statements. We will continue to monitor the impact as additional countries enact legislation going forward.

​

Reconciliation between the federal statutory rate and RPC’s effective tax rate is as follows:

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Years ended December 31,

​

2024

​

2023

​

2022

(in thousands)

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Federal statutory rate

​

$

23,688

​

21.0

%

​

$

53,811

​

21.0

%

​

$

60,823

​

21.0

%

State income taxes, net of federal benefit (a)

​

​

2,491

​

2.2

​

​

​

5,401

​

2.1

​

​

​

5,148

​

1.8

Foreign taxes, net of federal benefit

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Canada

​

​

​

​

​

​

​

​

​

​

​

​

​

​

​

Change in valuation allowance

​

​

(1,187)

​

(1.1)

​

​

​

614

​

0.2

​

​

​

573

​

0.2

​

Other

​

61

​

0.1

​

​

(500)

​

(0.2)

​

​

(541)

​

(0.2)

​

Other foreign jurisdiction

​

​

436

​

0.4

​

​

​

721

​

0.3

​

​

​

833

​

0.3

​

Tax credits

​

​

(1,036)

​

(0.9)

​

​

​

(703)

​

(0.3)

​

​

​

(424)

​

(0.1)

​

Change in unrecognized tax benefits

​

​

(1,637)

​

(1.5)

​

​

​

251

​

0.1

​

​

​

144

​

—

​

Non-deductible expenses

​

​

1,833

​

1.6

​

​

​

2,154

​

0.9

​

​

​

2,254

​

0.8

​

Cross-border tax laws

​

(315)

​

(0.3)

​

​

(256)

​

(0.1)

​

​

(250)

​

(0.1)

​

Change in valuation allowance

​

—

​

—

​

​

—

​

—

​

​

(174)

​

(0.1)

​

Interest related to tax matters

​

(2,189)

​

(1.9)

​

​

(1,757)

​

(0.7)

​

​

(1,306)

​

(0.5)

​

Other

​

(787)

​

(0.7)

​

​

1,394

​

0.6

​

​

4,189

​

1.5

​

Income tax provision and effective tax rate

​

$

21,358

​

18.9

%

​

$

61,130

​

23.9

%

​

$

71,269

​

24.6

%

​

(a) Income taxes in Texas, Oklahoma, and New Mexico made up the majority (greater than 50 percent) of the state tax effect.

​

Significant components of the Company’s deferred tax assets and liabilities are as follows:

​

​	​	​	​	​	​	​
December 31,		2024			2023
(in thousands)	​	​	​	​	​	​
Deferred tax assets:		​			​
Self-insurance	​	$	3,386	​	$	4,303
Long-term retirement plan	​		5,276	​		5,101
State net operating loss carryforwards	​		2,010	​		1,520
Allowance for credit losses	​		1,826	​		1,634
Stock-based compensation	​		1,995	​		1,414
Inventory reserve	​	​	3,178	​	​	3,330
Lease liability	​	​	7,067	​	​	5,777
Capitalized research and development	​	​	4,721	​	​	3,066
All others, net	​		1,959	​		1,535
Gross deferred tax assets	​		31,418	​		27,680
Deferred tax liabilities:	​		​	​		​
Depreciation	​		(75,559)	​		(66,784)
Right of use asset	​	​	(7,013)	​	​	(5,461)
Goodwill amortization	​		(7,035)	​		(6,725)
Gross deferred tax liabilities	​		(89,607)	​		(78,970)
Net deferred tax liabilities	​	$	(58,189)	​	$	(51,290)

​

Total net income tax (refunds) payments were $(31.7) million in 2024, $62.2 million in 2023, and $35.8 million in 2022. The following table lists the components of the payments for income taxes:

​

​	​	​	​	​	​	​	​	​	​
Years ended December 31,		2024			2023			2022
(in thousands)	​	​	​	​	​	​	​	​	​
Federal	​	$	(35,538)	​	$	56,000	​	$	33,852
State	​		​	​		​	​		​
Texas	​	​	2,021	​	​	1,823	​	​	400
Oklahoma	​	​	—	​	​	1,000	​	​	(668)
Other	​	​	1,330	​	​	2,345	​	​	1,203
Foreign	​		511	​		1,058	​		1,022
Total net (refunds) payments	​	$	(31,676)	​	$	62,226	​	$	35,809

​

As of December 31, 2024, the Company has net operating loss carryforwards recorded related to state income taxes of $37.2 million (gross) that will expire between 2025 and 2045.

The Company’s policy is to record interest and penalties related to income tax matters, as part of income tax expense. Accrued interest and penalties were $2.5 million as of December 31, 2024, and $1.8 million as of December 31, 2023.

During 2024, the Company recognized a decrease in its liability for unrecognized tax benefits primarily due to the true-up of tax accruals related to refunds received during the year. The liability is recorded as part of other long-term liabilities on the Consolidated Balance Sheet. This liability, if released, would affect our effective rate. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

​

​	​	​	​	​	​	​
​		2024			2023
(in thousands)	​	​	​	​	​	​
Balance at January 1	​	$	2,168	​	$	1,917
Additions based on tax positions related to the current year		​	167		​	337
(Reductions) for tax positions of prior years		​	(1,804)		​	(86)
Balance at December 31	​	$	531	​	$	2,168

​

The Company and its subsidiaries are subject to U.S. federal and state and foreign income tax in multiple jurisdictions. In many cases, the uncertain tax positions are related to tax years that remain open and subject to examination by the relevant taxing

authorities. In general, the Company’s 2021 through 2023 tax years remain open to examination. Additional years may be open to the extent attributes are being carried forward to an open year.

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The entire disclosure for income tax.

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