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Income Taxes
 9 Months Ended
Sep. 30, 2023
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The Company accounts for income taxes by recognizing deferred tax assets and liabilities based upon temporary differences between the amounts for financial reporting purposes and tax basis of its assets and liabilities. Deferred tax assets decreased $1.4 million to a deferred tax liability during the nine months ended September 30, 2023 as a result of changes to temporary timing differences associated with accelerated tax depreciation. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more-likely-than-not that some portion, or all, of the deferred tax asset will not be realized. In assessing the realization of deferred tax assets, management evaluates both positive and negative evidence, including the forecasts of future income, applicable tax planning strategies, and assessments of current and future economic and business conditions. This analysis is updated quarterly and adjusted as necessary. Based on this analysis, management has determined that a valuation allowance for deferred tax assets was not required at September 30, 2023.
For the nine months ended September 30, 2023 and 2022, income tax expense was $4.7 million and $8.5 million, respectively, resulting in an effective income tax rate of 26.1% and 31.3%, respectively. The effective tax rate differs from the statutory rate of 24.9% during the nine months ended September 30, 2023 due primarily to nondeductible wages, state taxes and the tax effect of stock-based compensation. The effective tax rate differs from the statutory rate of 24.9% during the nine months ended September 30, 2022 due primarily to the tax effect of nondeductible wages and stock-based compensation.
The Company had no unrecognized tax benefits at September 30, 2023.