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Note 12 - Federal and State Income Taxes | 12 Months Ended
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Dec. 31, 2020
Notes to Financial Statements |
Income Tax Disclosure [Text Block] |
12. | FEDERAL AND STATE INCOME TAXES
Under GAAP, deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and for income tax reporting purposes. Significant components of the Company’s deferred tax liabilities and assets at December 31 are as follows:
|  | 2020 |  |  | 2019 |
|  | (in thousands) |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  | $ | 100,736 |  |  | $ | 83,453 |
Unrealized gains on securities |  |  | 2,580 |  |  |  | 2,580 |
Prepaid expenses and other |  |  | 2,599 |  |  |  | 2,193 |
Total deferred tax liabilities |  |  | 105,915 |  |  |  | 88,226 |
Deferred tax assets: |  |  |  |  |  |  |  |
Current expected credit losses |  |  | 896 |  |  |  | 760 |
Tax credit carryforwards |  |  | 988 |  |  |  | 988 |
Compensated absences |  |  | 189 |  |  |  | 512 |
Self-insurance allowances |  |  | 674 |  |  |  | 5,630 |
Marketable equity securities |  |  | 2,129 |  |  |  | 1,253 |
Net operating loss carryover |  |  | 32,031 |  |  |  | 15,364 |
Other |  |  | 125 |  |  |  | 197 |
Total deferred tax assets |  |  | 37,032 |  |  |  | 24,704 |
Net deferred tax liability |  | $ | 68,883 |  |  | $ | 63,522 |
The reconciliation between the effective income tax rate and the statutory Federal income tax rate for the years ended December 31, 2020, 2019 and 2018 is presented in the following table:
|  | 2020 |  |  | 2019 |  |  | 2018 |
|  | (in thousands) |
|  | Amount |  |  | Percent |  |  | Amount |  |  | Percent |  |  | Amount |  |  | Percent |
Federal income tax at statutory rate |  | $ | 4,916 |  |  |  | 21.0 |  |  | $ | 2,124 |  |  |  | 21.0 |  |  | $ | 6,582 |  |  |  | 21.0 |
Nondeductible per diem and meals |  |  | 321 |  |  |  | 1.4 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Other nondeductible expenses, net |  |  | - |  |  |  | - |  |  |  | 342 |  |  |  | 3.4 |  |  |  | 80 |  |  |  | 0.2 |
State income taxes/other, net |  |  | 345 |  |  |  | 1.5 |  |  |  | (251 | ) |  |  | (2.5 | ) |  |  | 685 |  |  |  | 2.2 |
Total income tax expense |  | $ | 5,582 |  |  |  | 23.9 |  |  | $ | 2,215 |  |  |  | 21.9 |  |  | $ | 7,347 |  |  |  | 23.4 |
The provision (benefit) for income taxes consisted of the following:
|  | 2020 |  |  | 2019 |  |  | 2018 |
|  | (in thousands) |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | (62 | ) |  | $ | (56 | ) |  | $ | (48 | )
State |  |  | 282 |  |  |  | 646 |  |  |  | 189 |
Total current income tax provision |  |  | 220 |  |  |  | 590 |  |  |  | 141 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 4,860 |  |  |  | 2,177 |  |  |  | 6,185 |
State |  |  | 502 |  |  |  | (552 | ) |  |  | 1,021 |
Total deferred income tax provision |  |  | 5,362 |  |  |  | 1,625 |  |  |  | 7,206 |
Total income tax provision expense |  | $ | 5,582 |  |  | $ | 2,215 |  |  | $ | 7,347 |
In March 2020, the President of the United States signed the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), to stabilize the economy during the coronavirus pandemic. The CARES Act temporarily suspends and modifies certain tax laws established by the TCJA, including, but not limited to, modifications to net operating loss limitations, business interest limitations and alternative minimum tax. The CARES Act did not have a material impact on the Company’s current year provision or the Company’s consolidated financial statements. The Company has general business credits of approximately $988,000 at December 31, 2018, which begin to expire after the year 2030. The Company also has net operating loss carryovers for federal income purposes of approximately $59,715,000 of which $30,835,000 will begin to expire after the year 2030 while the remaining balance does not expire and can be carried forward indefinitely. In determining whether a tax asset valuation allowance is necessary, management, in accordance with the provisions of ASC 740-10-30, weighs all available evidence, both positive and negative to determine whether, based on the weight of that evidence, a valuation allowance is necessary. If negative conditions exist which indicate a valuation allowance might be necessary, consideration is then given to what effect the future reversals of existing taxable temporary differences and the availability of tax strategies might have on future taxable income to determine the amount, if any, of the required valuation allowance. As of December 31, 2020 and 2019, management determined that the future reversals of existing taxable temporary differences and available tax strategies would generate sufficient future taxable income to realize its tax assets and therefore a valuation allowance was not necessary. The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by taxing authorities, based on the technical merits of the position. As of December 31, 2020, an adjustment to the Company’s consolidated financial statements for uncertain tax positions has not been required as management believes that the Company’s tax positions taken in income tax returns filed or to be filed are supported by clear and unambiguous income tax laws. The Company recognizes interest and penalties related to uncertain income tax positions, if any, in income tax expense. During 2020 and 2019, the Company has not recognized or accrued any interest or penalties related to uncertain income tax positions. The Company and its subsidiaries are subject to U.S. and Canadian federal income tax laws as well as the income tax laws of multiple state jurisdictions. The major tax jurisdictions in which the Company operates generally provide for a deficiency assessment statute of limitation period of three years, and as a result, the Company’s tax years 2017 and forward remain open to examination in those jurisdictions.

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- 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://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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