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Income Taxes (Notes)
 12 Months Ended
Dec. 31, 2013
Income Tax Disclosure [Abstract]  
Income Taxes
Income Taxes
The Company files a consolidated federal income tax return. It is the policy of the Company to allocate the consolidated tax provision to subsidiaries as if each subsidiary’s tax liability or benefit were determined on a separate company basis. As part of the consolidated group, subsidiaries transfer to the Company their current federal tax liabilities or assets.
 
 
As of December 31,
 
2013
 
2012
 
2011
Current city income tax provision
$
952,957

 
$
406,814

 
$
658,106

Current state income tax provision
268,920

 
122,704

 
271,776

Current federal income tax provision
17,866,911

 
8,990,777

 
8,921,527

Deferred federal income tax benefit
(5,611,451
)
 
(368,572
)
 
(1,209,928
)
Provision for income taxes
$
13,477,337

 
$
9,151,723

 
$
8,641,481


A reconciliation of income tax expense at the statutory federal rate to the Company’s income tax expense is as follows:
 
 
2013
 
2012
 
2011
Income tax computed at statutory rate
$
12,471,258

 
$
9,128,915

 
$
8,048,057

City and state income taxes, net of federal benefit
794,220

 
344,187

 
604,423

Other
211,859

 
(321,379
)
 
(10,999
)
Income tax expense
$
13,477,337

 
$
9,151,723

 
$
8,641,481


In addition to the income tax expense listed above for the years ended December 31, 2013, 2012 and 2011, income tax benefit recorded in shareholders' equity for the same periods was $778 thousand, $2.0 million, and $7 thousand, respectively. Included in 2012 is $2.0 million which relates to tax benefits not previously claimed by the Company.
Deferred tax assets and liabilities consist of the following at December 31, 2013 and 2012:
 
 
2013
 
2012
Stock-based compensation
$
4,433,293

 
$
3,289,885

Accrued incentive compensation
4,075,735

 
—

Unrealized (gains) losses
(316,926
)
 
(763,235
)
Other assets and liabilities
(128,677
)
 
(74,676
)
Net deferred tax assets
$
8,063,425

 
$
2,451,974


The net temporary differences incurred to date will reverse in future periods as the Company generates taxable earnings. The Company believes it is more likely than not that the results of future operations will generate sufficient taxable income to realize the net deferred tax assets recorded. The Company records a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. As of December 31, 2013, no valuation allowance was deemed necessary.
FASB ASC 740, Income Taxes, prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company did not record an accrual for tax related uncertainties or unrecognized tax positions as of December 31, 2013. The Company does not expect a change to the reserve for uncertain tax positions within the next twelve months that would have a material impact on the consolidated financial statements. As of December 31, 2013, the Company recorded through the tax provision net interest expense of $321 thousand as a result of an IRS examination.
The Company files income tax returns in the federal and all applicable state and local jurisdictions. The Company is subject to federal, state and local examinations by tax authorities for tax years ended December 31, 2009 through 2013.