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Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities from continuing operations are as follows at the respective year ends:
(in thousands) | 2023 |  | 2022
Deferred income tax assets: |  |  |
Inventory valuation reserves | $ | 1,829 |  |  | $ | 963 |
Inventory capitalization | 360 |  |  | 907 |
Accrued bonus | 127 |  |  | 150 |
State net operating loss carryforwards | 2,239 |  |  | 1,572 |
Federal net operating loss carryforwards | 2,209 |  |  | 1,088 |
Lease liabilities | 7,415 |  |  | 7,744 |
Interest Limitation Carryforwards | 1,396 |  |  | 555 |
Intangible asset basis differences | 2,564 |  |  | 3,262 |
Other | 1,932 |  |  | 1,192 |
Total deferred income tax assets | 20,071 |  |  | 17,433 |
State valuation allowance | (1,641) |  |  | (1,371) |
Total net deferred income tax assets | 18,430 |  |  | 16,062 |
Deferred income tax liabilities: |  |  |
Fixed asset basis differences | 5,478 |  |  | 7,184 |
Prepaid expenses | 445 |  |  | 418 |
Lease assets | 6,699 |  |  | 7,107 |
Total deferred income tax liabilities | 12,622 |  |  | 14,709 |
Deferred income taxes, net | $ | 5,808 |  |  | $ | 1,353 |
Significant components of the provision for income taxes are as follows:
(in thousands) | 2023 |  | 2022 |  |
Current: |  |  |  |  |
Federal | $ | (561) |  |  | $ | (189) |  |  |
State | 191 |  |  | 137 |  |  |
Total current | (370) |  |  | (52) |  |  |
Deferred: |  |  |  |  |
Federal | (5,965) |  |  | (4,903) |  |  |
State | (589) |  |  | (613) |  |  |
Total deferred | (6,554) |  |  | (5,516) |  |  |
Total | $ | (6,924) |  |  | $ | (5,568) |  |  |
The reconciliation of income tax computed at the U. S. federal statutory tax rates to income tax expense is:
(in thousands) | 2023 |  | 2022 |  |
Amount |  | % |  | Amount |  | % |  |  |  |
Tax at U.S. statutory rates | $ | (8,616) |  |  | 21.0 | % |  | $ | 2,522 |  |  | 21.0 | % |  |  |  |
State income taxes, net of federal tax benefit | (585) |  |  | 1.4 | % |  | 184 |  |  | 1.5 | % |  |  |  |
Federal and State valuation allowance | 270 |  |  | (0.7) | % |  | (2,366) |  |  | (19.7) | % |  |  |  |
Stock option compensation | 87 |  |  | (0.2) | % |  | (173) |  |  | (1.4) | % |  |  |  |
Tax Benefits Associated with Palmer Closure | — |  |  | — | % |  | (5,707) |  |  | (47.5) | % |  |  |  |
Other nondeductible expenses | 33 |  |  | (0.1) | % |  | 51 |  |  | 0.4 | % |  |  |  |
Goodwill impairment | 2,049 |  |  | (5.0) | % |  | — |  |  | — | % |  |  |  |
Other, net | (162) |  |  | 0.5 | % |  | (79) |  |  | (0.7) | % |  |  |  |
Total | $ | (6,924) |  |  | 16.9 | % |  | $ | (5,568) |  |  | (46.4) | % |  |  |  |
The Company's effective tax rate for 2023 was less than the U.S. statutory rate of 21% primarily driven by tax benefits associated with non-deductible goodwill impairment. The Company's effective tax rate for 2022 was less than the U.S. statutory rate of 21% primarily driven by tax benefits associated with the closure of Palmer and the release of valuation allowances on certain deferred tax assets, partially offset by state taxes. The Company made income tax payments of $0.9 million and $7.8 million in 2023 and 2022, respectively. The Company has $10.5 million of U.S. Federal net operating loss carryforwards and $6.6 million of interest limitation carryforwards at the end of 2023 compared to $5.2 million of U.S. Federal net operating loss carryforwards and $2.6 million interest limitation carryforwards at the end of 2022. The Company believes that these carryforwards are more likely than not to be utilized in future periods. The majority of these carryforwards are not subject to expiration. In addition, on a gross basis the Company had state net operating loss carryforwards of $49.0 million and $37.2 million at the end of 2023 and 2022, respectively. As of the end of 2023, the Company had recognized a state valuation allowance of $1.6 million. This represents a $0.3 million increase year-over-year primarily driven by losses in jurisdictions for which we believe it is not more likely than not to be utilized in future periods. The majority of these losses will expire between the years of 2023 and 2043, while certain losses are not subject to expiration. The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. The Company is no longer subject to U.S. federal examinations for years before 2020 or state examinations for years before 2019. The Company had no uncertain tax position activity during 2023 or 2022. The Company's continuing practice is to recognize interest and/or penalties related to income tax matters in the provision for income taxes. The Company had no accruals for uncertain tax positions including interest and penalties at the end of 2023.

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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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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