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Income Taxes
 3 Months Ended
Mar. 31, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax basis of assets and liabilities at the enacted tax rates. The Company reviews its deferred tax assets regularly for recoverability. As of March 31, 2023, the Company determined that it did not need a valuation allowance on its gross deferred tax assets. Although realization of the deferred tax assets is not assured, management believes that it is more likely than not the deferred tax assets will be realized based on our expectation that we will be able to fully utilize the deductions that are ultimately recognized for tax purposes.
For the three months ended March 31, 2023, there was no current reporting period activity recorded in the condensed consolidated statement of income or the condensed consolidated balance sheet related to uncertain tax positions.
The effective tax rate for the three months ended March 31, 2023 was 26.3% compared to 22.0% for the same period last year.
The difference between our effective tax rate and the statutory rate, for the three months ended March 31, 2023, is primarily driven by permanent items, principally non-deductible compensation. The provision for income taxes differed from the statutory rate as follows:
Three Months Ended
March 31,
20232022
Expected provision at federal statutory tax rate21.0 %21.0 %
Increases (decrease) resulting from:
State income tax, net of federal tax benefit2.3 %3.7 %
Disallowed compensation3.1 %1.3 %
Effect of rate change— %(3.9)%
Nondeductible expenses0.2 %0.1 %
Dividend received deduction(0.3)%(0.2)%
Total income tax expense (benefit)26.3 %22.0 %