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Income Taxes | 6 Months Ended
--- | ---
Jun. 30, 2024
Income Tax Disclosure [Abstract] |
Income Taxes | INCOME TAXES
| Three Months Ended June 30, |  | Six Months Ended June 30,
| 2024 |  | 2023 |  | 2024 |  | 2023
Provision for income taxes | $ | 1,772 |  |  | $ | 996 |  |  | $ | 2,568 |  |  | $ | 2,831 |
The operations of a partnership are generally not subject to income taxes, except for Texas margin tax, because its income is taxed directly to its partners. Current state income taxes attributable to the Texas margin tax relating to the operation of the Partnership of $470 and $80 were recorded in income tax expense for the three months ended June 30, 2024 and 2023, respectively. Current state income taxes attributable to the Texas margin tax relating to the operation of the Partnership of $550 and $200 were recorded in income tax expense for the six months ended June 30, 2024 and 2023, respectively. Deferred taxes applicable to the Texas margin tax relating to the operation of the Partnership are immaterial. MTI, a wholly owned subsidiary of the Partnership, is subject to income taxes due to its corporate structure (the "Taxable Subsidiary"). Total income tax expense of $1,302 and $916, related to the operation of the Taxable Subsidiary, for the three months ended June 30, 2024 and 2023, resulted in an effective income tax rate ("ETR") of 30.68% and 26.60%, respectively. Total income tax expense of $2,018 and $2,631, related to the operation of the Taxable Subsidiary, for the six months ended June 30, 2024 and 2023, resulted in an ETR of 22.94% and 25.16%, respectively. The increase in the provision for income taxes and the ETR for the income taxes during the three months ended June 30, 2024, was primarily due to an increase in the Texas margin tax, as the more favorable wholesaler/retailer rate is no longer applicable on a combined reporting basis with the Partnership, and an increase in permanent differences, compared to the same period in 2023. The decrease in the provision for income taxes and the ETR for the income taxes during the six months ended June 30, 2024, was primarily due to a favorable true-up to state net operating loss carryforwards, compared to the same period in 2023. A current federal income tax expense of $786 and $162, related to the operation of the Taxable Subsidiary, was recorded for the three months ended June 30, 2024 and 2023, respectively. A current federal income tax expense of $1,576 and $487, related to the operation of the Taxable Subsidiary, was recorded for the six months ended June 30, 2024 and 2023, respectively. A current state income tax expense of $165 and $64, related to the operation of the Taxable Subsidiary, was recorded for the three months ended June 30, 2024 and 2023, respectively. A current state income tax expense of $416 and $277, related to the operation of the Taxable Subsidiary, was recorded for the six months ended June 30, 2024 and 2023, respectively. With respect to MTI, income taxes are accounted for under the asset and liability method pursuant to the provisions of ASC 740 related to income taxes. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A deferred tax expense related to the MTI temporary differences of $351 and $690 was recorded for the three months ended June 30, 2024 and 2023, respectively. A deferred tax expense related to the MTI temporary differences of $26 and $1,867 was recorded for the six months ended June 30, 2024 and 2023, respectively. A net deferred tax asset of $10,174 and $10,200, related to the cumulative book and tax temporary differences, existed at June 30, 2024 and December 31, 2023, respectively. All income tax positions taken for all open years are more likely than not to be sustained based upon their technical merit under applicable tax laws.

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