XML 68 R12.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Income Taxes (Notes) | 12 Months Ended
--- | ---
Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction, various states and Canada. With a few exceptions, the Company is no longer subject to U.S. federal, state and local, or Canadian examinations by tax authorities for years before 2012. Tax Reform On December 22, 2017, President Trump signed into law H.R. 1, “An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018” (this legislation is referred to herein as the “U.S. Tax Act”). The U.S. Tax Act provided for significant changes in the U.S. Internal Revenue Code of 1986, as amended. The U.S. Tax Act contained provisions with separate effective dates but was generally effective for taxable years beginning after December 31, 2017. Beginning on January 1, 2018, the U.S. Tax Act lowered the U.S. corporate income tax rate from 35% to 21% on our U.S. earnings from that date and beyond. The revaluation of our U.S. deferred tax assets and liabilities to the 21% corporate tax rate reduced our net U.S. deferred income tax liability by approximately $15,901 which is reflected as a reduction in our income tax expense in our results for the quarter and year ended December 31, 2017. On December 22, 2017, the SEC staff issued SAB 118 that allowed us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. As of December 22, 2018, the Company completed its accounting for all of the enactment-date income tax effects of the U.S. Tax Act. The Company made no adjustments to the provisional amounts recorded at December 31, 2017. Income Taxes The provision for income taxes consists of the following:
| 2019 |  | 2018 |  | 2017
Current: |  |  |  |  |
Federal | $ | 17,319 |  |  | $ | 16,572 |  |  | $ | 28,556 |
State | 4,925 |  |  | 3,559 |  |  | 4,043 |
| 22,244 |  |  | 20,131 |  |  | 32,599 |
Deferred: |  |  |  |  |  |
Federal | 5,561 |  |  | 7,194 |  |  | (11,860 | )
State | 1,207 |  |  | 870 |  |  | (457 | )
| 6,768 |  |  | 8,064 |  |  | (12,317 | )
| $ | 29,012 |  |  | $ | 28,195 |  |  | $ | 20,282 |
The historical income tax expense differs from the amounts computed by applying the federal statutory rate of 21.0% for 2019 and 2018 and 35.0% for 2017 to income before income taxes as follows:
| 2019 |  | 2018 |  | 2017
Tax expense at the statutory rate | $ | 24,383 |  |  | $ | 25,252 |  |  | $ | 37,637 |
State income taxes, net of federal benefit | 4,843 |  |  | 3,685 |  |  | 2,339 |
Share-based compensation | (587 | ) |  | (50 | ) |  | (366 | )
Qualified stock options | 34 |  |  | 12 |  |  | 32 |
Other permanent differences | 189 |  |  | 150 |  |  | 252 |
Section 162(m) limitation | 421 |  |  | 13 |  |  | — |
Deferred tax asset valuation allowance | — |  |  | 35 |  |  | 78 |
Federal qualified property deductions | — |  |  | — |  |  | (2,075 | )
Federal income tax credits | (183 | ) |  | (207 | ) |  | (58 | )
Non-taxable acquisitions | — |  |  | — |  |  | (568 | )
Rate impact on deferred tax liabilities | — |  |  | — |  |  | (15,901 | )
Other | (88 | ) |  | (695 | ) |  | (1,088 | )
| $ | 29,012 |  |  | $ | 28,195 |  |  | $ | 20,282 |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax liabilities and assets are as follows:
| December 31, 2019 |  | December 31, 2018
Deferred tax assets: |  |  |
Accrued expenses | $ | 8,454 |  |  | $ | 10,362 |
Allowance for doubtful accounts | 539 |  |  | 535 |
Operating lease obligations | 38,822 |  |  | — |
Share-based compensation | 3,881 |  |  | 3,526 |
Accruals for income tax contingencies | 185 |  |  | 217 |
Net operating loss carryforwards | 1,089 |  |  | 2,906 |
Total deferred tax assets | 52,970 |  |  | 17,546 |
Valuation allowance | (395 | ) |  | (395 | )
Total deferred tax assets, net of valuation allowance | 52,575 |  |  | 17,151 |
Deferred tax liabilities: |  |  |
Tax over book depreciation | 26,816 |  |  | 25,606 |
Prepaid expenses deductible when paid | 4,356 |  |  | 3,902 |
Operating lease right-of-use assets | 38,822 |  |  | — |
Goodwill | 16,036 |  |  | 13,913 |
Intangible assets | 10,487 |  |  | 10,904 |
Total deferred tax liabilities | 96,517 |  |  | 54,325 |
Net deferred tax liabilities | $ | (43,942 | ) |  | $ | (37,174 | )
Total cash income tax payments, net of refunds, during fiscal years 2019, 2018 and 2017 were $20,121, $21,064 and $36,110, respectively. The Company has considered the weight of all available evidence in determining the need for a valuation allowance against each of the Company’s various deferred tax assets and believes the Company’s history of income is a significant weight of evidence supporting the realization of all of the Company’s federal and most state deferred tax assets. In addition, the Company believes all existing deferred tax liabilities will reverse in a manner that generates enough taxable income to realize an offsetting amount of deferred tax assets. Given the historical positive performance of the Company for having more than ten consecutive years of profitability, the Company expects to fully utilize the vast majority of its deferred tax assets and has concluded that the only valuation allowance needed relates to state net operating loss carryforwards, as noted below. As a result of the Towne acquisition, the Company has approximately $2,000, $10,258 and $18,586 of federal net operating losses as of December 31, 2019, 2018 and 2017 respectively, that will expire between 2020 and 2030. The Company expects to be able to fully utilize these federal net operating losses before they expire. At December 31, 2019, 2018 and 2017 the Company had state net operating loss carryforwards of $16,926, $18,148 and $18,126, respectively that will expire between 2019 and 2030. Also, the use of these state net operating losses is limited to the future taxable income of separate legal entities. Based on expectations of future taxable income, management believes that it is more likely than not that the results of operations for certain separate legal entities will not generate sufficient taxable income to realize portions of these net operating loss benefits for state loss carryforwards. As a result, a valuation allowance has been provided for the state loss carryforwards for these specific legal entities. The valuation allowance on these state loss carryforwards did not change during 2019, and increased $35 during 2018 and $78 during 2017. Income Tax Contingencies The Company, or one of its subsidiaries, files income tax returns in the U.S. federal jurisdiction, various states and Canada. With a few exceptions, the Company is no longer subject to U.S. federal, state and local, or Canadian examinations by tax authorities for years before 2012. A reconciliation of the beginning and ending amount of unrecognized tax benefit is as follows:
| Liability for
| Unrecognized Tax
| Benefits
Balance at December 31, 2016 | 582 |
Reductions for settlement with state taxing authorities | (14 | )
Additions for tax positions of prior years | 400 |
Additions for tax positions of current year | 366 |
Balance at December 31, 2017 | 1,334 |
Reductions for settlement with state taxing authorities | (271 | )
Reductions for tax positions of prior years | (40 | )
Additions for tax positions of current year | 35 |
Balance at December 31, 2018 | 1,058 |
Reductions for settlement with state taxing authorities | (99 | )
Additions for tax positions of current year | 28 |
Balance at December 31, 2019 | $ | 987 |
Included in the liability for unrecognized tax benefits at December 31, 2019 and December 31, 2018 are tax positions of $987 and $1,058, respectively, which represents tax positions where the realization of the ultimate benefit is uncertain and the disallowance of which would affect the Company’s annual effective income tax rate. In addition, at December 31, 2019 and December 31, 2018, the Company had accrued penalties associated with unrecognized tax benefits of $104 and $61, respectively. At December 31, 2019 and December 31, 2018, the Company also had accrued interest associated with unrecognized tax benefits of $214 and $143, respectively.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration