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INCOME TAXES
 12 Months Ended
Dec. 31, 2024
INCOME TAXES  
INCOME TAXES

14. INCOME TAXES

The provision for income taxes included the following components for the years ended December 31, 2024 and 2023:

​

​

​

​

​

​

​

​

​

    

2024

    

2023

​

​

(Dollars in thousands)

Current:

 

​

  

 

​

  

Federal

​

$

6,243

​

$

5,859

State

​

 

1,997

​

 

1,839

Foreign

​

 

219

​

 

516

Total

​

 

8,459

​

 

8,214

Deferred

​

 

1,057

​

 

2,462

Total provision

​

$

9,516

​

$

10,676

​

The differences between the U.S. federal statutory income tax rate and our effective tax rate were as follows for the years ended December 31, 2024 and 2023:

​

​

​

​

​

​

​

​

    

2024

    

2023

 

U.S. federal statutory income tax rate

 

21.0

%  

21.0

%

State income taxes, net of federal tax benefit

 

4.0

 

4.1

​

Foreign income tax rate differences

 

0.9

 

0.3

​

Share-based compensation

 

(1.6)

 

(0.2)

​

Other

 

(0.4)

 

0.9

​

Effective tax rate

 

23.9

%  

26.1

%

​

The foreign component of pretax earnings was $0.9 million and $2.8 million in 2024 and 2023, respectively.

The components of deferred taxes at December 31, 2024 and 2023 were as follows:

​

​

​

​

​

​

​

​

​

    

2024

    

2023

​

​

(Dollars in thousands)

Deferred income tax assets:

 

​

  

 

​

  

Accounts receivable reserves

​

$

266

​

$

385

Pension liability

​

 

2,708

​

 

3,635

Accrued liabilities

​

 

1,582

​

 

1,724

Operating lease liabilities

​

​

3,566

​

​

4,024

Foreign currency losses on intercompany loans

​

 

—

​

 

58

​

​

 

8,122

​

 

9,826

Deferred income tax liabilities:

​

 

​

​

 

​

Inventory and related reserves

​

 

(5,140)

​

 

(5,024)

Cash value of life insurance

​

 

(753)

​

 

(682)

Property, plant and equipment

​

 

(1,484)

​

 

(1,297)

Intangible assets

​

 

(10,207)

​

 

(9,639)

Prepaid expenses and other assets

​

 

(308)

​

 

(352)

Operating lease right-of-use assets

​

​

(3,115)

​

​

(3,555)

​

​

 

(21,007)

​

 

(20,549)

Net deferred income tax liabilities

​

$

(12,885)

​

$

(10,723)

​

The net deferred income tax liabilities are classified in the Consolidated Balance Sheets as follows:

​

​

​

​

​

​

​

​

​

    

2024

    

2023

​

​

(Dollars in thousands)

Non-current deferred income tax benefits

​

$

1,037

​

$

1,096

Non-current deferred income tax liabilities

​

 

(13,922)

​

 

(11,819)

Net deferred income tax liabilities

​

$

(12,885)

​

$

(10,723)

​

Uncertain Tax Positions

We account for our uncertain tax positions in accordance with ASC 740, Income Taxes (“ASC 740”). ASC 740 provides that the tax effects from an uncertain tax position can be recognized in our consolidated financial statements only if the position is more likely than not of being sustained on audit, based on the technical merits of the position.

The following table summarizes the activity related to our unrecognized tax benefits:

​

​

​

​

​

​

​

​

​

    

2024

    

2023

​

​

(Dollars in thousands)

Unrecognized tax benefits balance at January 1,

​

$

608

​

$

305

Increases related to current year tax positions

​

 

32

​

 

366

Decreases due to lapsing of statute of limitations

​

 

—

​

 

(63)

Unrecognized tax benefits balance at December 31, 

​

$

640

​

$

608

​

The unrecognized tax benefits at December 31, 2024 and 2023, included $90,000 and $30,000, respectively, of interest related to such positions. The unrecognized tax benefits, if ultimately recognized, would reduce our annual effective tax rate. The liabilities for potential interest are included in the Consolidated Balance Sheets at December 31, 2024 and 2023.

We file a U.S. federal income tax return, various U.S. state income tax returns and several foreign returns. In general, the 2020 through 2023 tax years remain subject to examination by those taxing authorities.