XML 18 R15.htm IDEA: XBRL DOCUMENT
v3.19.3.a.u2

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2019
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES Income tax expense is composed of the following:
| Year Ended December 31, |  |  |  |
| 2019 |  | 2018 |  | 2017
Current: |  |  |  |  |
Federal | $ | 6,426 |  |  | $ | 8,844 |  |  | $ | 14,020 |
State | 412 |  |  | 1,317 |  |  | 379 |
| 6,838 |  |  | 10,161 |  |  | 14,399 |
Deferred: |  |  |  |  |
Federal | 352 |  |  | 55 |  |  | (3,764) |
State | (46) |  |  | 1,480 |  |  | 300 |
| 306 |  |  | 1,535 |  |  | (3,464) |
Total | $ | 7,144 |  |  | $ | 11,696 |  |  | $ | 10,935 |
Income tax expense also included tax expense allocated to comprehensive income for 2019, 2018, and 2017 of $14, $73, and $37, respectively (see the Consolidated Statements of Comprehensive Income). On December 22, 2017, the United States enacted tax reform legislation commonly known as the Tax Act, resulting in significant modifications to the then existing law, impacting the measurement of income taxes for the year ended December 31, 2017, and the years thereafter. The Company recorded a discrete net tax benefit in its Consolidated Statement of Income through net income of $3,343 in the year ended December 31, 2017. This net benefit was driven by a re-measurement of the carrying value of its deferred tax assets and liabilities because of the corporate rate reduction. This net benefit provided a 6.3 percent reduction in the Company’s effective tax rate for the year ended December 31, 2017. A reconciliation of income tax expense at the normal statutory federal rate to income tax expense included in the accompanying Consolidated Statements of Income is below:
| Year Ended December 31, |  |  |  |
| 2019 |  | 2018 |  | 2017
"Expected" provision at federal statutory rate | $ | 9,654 |  |  | $ | 10,286 |  |  | $ | 18,465 |
State income taxes, net(a) | 1,540 |  |  | 2,029 |  |  | 1,612 |
Change in valuation allowance | (168) |  |  | 1,304 |  |  | (578) |
Domestic production activity deduction | — |  |  | — |  |  | (957) |
Share-based compensation(a) | (2,877) |  |  | (1,201) |  |  | (4,254) |
Compensation limits | 148 |  |  | — |  |  | 931 |
Federal and state tax credits | (1,302) |  |  | (807) |  |  | (1,058) |
Tax benefit from the Tax Act | — |  |  | — |  |  | (3,343) |
Other | 149 |  |  | 85 |  |  | 117 |
Income tax expense | $ | 7,144 |  |  | $ | 11,696 |  |  | $ | 10,935 |
Effective tax rate | 15.6 | % |  | 23.9 | % |  | 20.7 | %
(a)The Company received federal excess tax benefits on share-based compensation awards in 2019, 2018, and 2017 of $2,877, $1,201, and $4,254, respectively, and state benefits of $459, $236 and $371, respectively, for excess tax benefits. The state benefits are part of the State income taxes, net, balances in the above table. Tax benefits from share-based compensation may be substantially less in future years, and in certain instances can create tax determinant. The tax effects of temporary differences giving rise to deferred income taxes shown on the Consolidated Balance Sheets are as follows:
| December 31, |  |
| 2019 |  | 2018
Deferred income tax assets: |  |  |
Post-retirement liability | $ | 717 |  |  | $ | 770 |
Deferred income | 300 |  |  | 393 |
Share-based compensation | 1,238 |  |  | 1,581 |
Capital loss carryforwards | 91 |  |  | 379 |
State tax credit carryforwards | 3,198 |  |  | 3,245 |
State operating loss carryforwards | 1,529 |  |  | 1,505 |
Inventories | 1,738 |  |  | 1,476 |
Operating lease liabilities | 1,582 |  |  | — |
Other | 1,291 |  |  | 1,231 |
Gross deferred income tax assets | 11,684 |  |  | 10,580 |
Less: valuation allowance | (1,284) |  |  | (1,452) |
Net deferred income tax assets | 10,400 |  |  | 9,128 |
Deferred income tax liabilities: |  |  |
Fixed assets | (10,332) |  |  | (10,497) |
Operating lease right-of-use assets | (1,577) |  |  | — |
Other | (420) |  |  | (308) |
Gross deferred income tax liabilities | (12,329) |  |  | (10,805) |
Net deferred income tax liability | $ | (1,929) |  |  | $ | (1,677) |
A schedule of the change in valuation allowance is as follows:
Balance at December 31, 2017 | $ | 148 |
Increase | 1,304 |
Balance at December 31, 2018 | 1,452 |
Decrease | (168) |
Balance at December 31, 2019 | $ | 1,284 |
As of December 31, 2019 and 2018, the Company’s total valuation allowance of $1,284 and $1,452, respectively, related to net operating loss carryforwards in states in which it is not "more likely than not" to create enough state taxable income to fully utilize the carryforwards before expiration of the carryforward periods, and capital loss carryforwards that the Company is not "more likely than not" to use before they expire. The reduction of the valuation allowance year over year is due to certain capital loss carryforwards and corresponding deferred tax asset related valuation allowance that expired at the end of 2019. As of December 31, 2019 and 2018, the Company had $21,918 and $21,575 in gross state net operating loss carryforwards, respectively. Due to varying state carryforward periods, the state net operating loss carryforwards will expire in varying years between calendar years 2020 and 2039. As of December 31, 2019 and 2018, the Company had gross state tax credit carryforwards of $4,049 and $4,107, respectively. State credits, if not used to offset income tax expense in their respective jurisdictions, will expire in varying years between 2020 and 2035. The Company treats accrued interest and penalties related to tax liabilities, if any, as a component of income tax expense. During 2019, 2018, and 2017, the Company's activity in accrued interest and penalties was not significant. The following is a reconciliation of the total amount of unrecognized tax benefits (excluding interest and penalties) for 2019, 2018, and 2017:
| Year Ended December 31, |  |  |  |  |  |
| 2019 |  | 2018 |  | 2017 |  |
Beginning of year balance | $ | 193 |  |  | $ | 185 |  |  | $ | 43 |  |  |
Additions based on prior year tax positions | 3 |  |  | 2 |  |  | 130 |  |  |
Additions based on current year tax positions | 78 |  |  | 11 |  |  | 12 |  |  |
Reduction for prior year tax positions | (19) |  |  | (5) |  |  | — |  |  |
End of year balance | $ | 255 |  |  | $ | 193 |  |  | $ | 185 |  |  |
For each period presented, substantially all of the amount of unrecognized benefits (excluding interest and penalties) would impact the effective tax rate, if recognized. The Company reasonably expects that the amount of unrecognized tax benefit will decrease by approximately half of its value over the next 12 months due to the statute of limitations expiring for unrecognized tax benefits related to the tax year ending 2016. The recognized tax benefit related to this decrease may be less than the gross activity due to audit adjustments. The Company is currently under federal income tax audit for tax year 2016. The Company does not expect this audit to result in a significant adjustment. For federal tax purpose, all tax years after 2015 remain open to adjustment. The Company is subject to examination for its state returns for year 2015, and forward, with the exception of certain net operating losses and credit carryforwards originating in years prior to 2015 that remain subject to adjustment.

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