INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2020

INCOME TAXES [ABSTRACT]

Sources of Pre-Tax Accounting Income

The sources of pre-tax operating income are as follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
Domestic	$	129,620	$	39,864	$	(13,926)
Foreign		40,648		70,547		70,164
Total	$	170,268	$	110,411	$	56,238

Components of Income Tax Expense (Benefit)

The components of the Company’s Provision for (benefit from) income taxes are as follows (in thousands):

	Year Ended December 31,
	2020		2019		2018
Current provision for (benefit from)
Federal	$	22,763	$	5,289	$	2,771
State		9,871		2,826		2,754
Foreign		13,496		18,938		18,933
Total current provision for (benefit from)		46,130		27,053		24,458
Deferred provision for (benefit from)
Federal		(2,390)		2,515		(943)
State		(254)		118		(138)
Foreign		(2,549)		(4,009)		(6,894)
Total deferred provision for (benefit from)		(5,193)		(1,376)		(7,975)
Total provision for (benefit from) income taxes	$	40,937	$	25,677	$	16,483

Effective Income Tax Rate Reconciliation Table

The following reconciles the Company’s effective tax rate to the federal statutory rate (in thousands):

	Year Ended December 31,
	2020		2019		2018
Income tax per U.S. federal statutory rate (21%, 21%, 21%)	$	35,756	$	23,186	$	11,810
State income taxes, net of federal deduction		6,923		3,144		2,003
Change in valuation allowances		3,903		9,832		2,191
Foreign income taxes at different rates than the U.S.		(783)		(3,356)		(3,758)
Foreign withholding taxes		106		600		785
Losses in international markets without tax benefits		(1,656)		(2,651)		(68)
Nondeductible compensation under Section 162(m)		656		668		615
Liabilities for uncertain tax positions		2,882		661		1,105
Permanent difference related to foreign exchange gains		(71)		36		136
(Income) losses of foreign branch operations		(10)		55		475
Non-taxable earnings of noncontrolling interest		(1,964)		(1,294)		(594)
Foreign dividend less foreign tax credits		(1,723)		(1,681)		(1,748)
Decrease (increase) to deferred tax asset - change in tax rate		(48)		(2,848)		(1,944)
State and Federal income tax credits and NOL's		(3,918)		(1,176)		19
Foreign earnings taxed currently in U.S.		1,936		2,172		3,976
Taxes related to prior year filings		(1,718)		(1,643)		(1,659)
Taxes related to acquisition accounting		1,317		978		2,110
Other		(651)		(1,006)		1,029
Income tax per effective tax rate	$	40,937	$	25,677	$	16,483
Effective tax rate percentage		24.0%		23.3%		29.3%

Schedule of Deferred Tax Assets and Liabilities

The Company’s deferred income tax assets and liabilities are summarized as follows (in thousands):

	Year Ended December 31,
	2020		2019
Deferred tax assets, gross
Accrued workers compensation, deferred compensation and employee benefits	$	8,574	$	7,999
Allowance for credit losses, insurance and other accruals		4,463		3,393
Amortization of deferred lease liabilities		20,352		25,757
Net operating losses		20,508		19,222
Equity compensation		1,660		1,442
Customer acquisition and deferred revenue accruals		6,868		9,047
Federal and state tax credits, net		2,383		1,263
Unrealized losses on derivatives		1,187		1,421
Impairment of equity investment		4,064		4,142
Partnership Investment		526		2,435
Other		5,444		1,322
Total deferred tax assets, gross		76,029		77,443
Valuation allowances		(18,697)		(17,051)
Total deferred tax assets, net		57,332		60,392
Deferred tax liabilities
Depreciation and amortization		(10,734)		(6,095)
Unrealized gain on derivatives		(2,959)		(1,491)
Contract acquisition costs		(3,182)		(5,740)
Intangible assets		(15,880)		(22,585)
Operating lease assets		(16,763)		(21,413)
Other		(480)		(407)
Total deferred tax liabilities		(49,998)		(57,731)
Net deferred tax assets	$	7,334	$	2,661

Valuation Allowance Rollforward

Activity in the Company’s valuation allowance accounts consists of the following (in thousands):

	Year Ended December 31,
	2020		2019		2018
Beginning balance	$	17,051	$	10,867	$	9,526
Additions of deferred income tax expense		4,650		7,373		2,913
Reductions of deferred income tax expense		(3,004)		(1,189)		(1,572)
Ending balance	$	18,697	$	17,051	$	10,867

Expiration of Net Operating Loss Carryforwards

As of December 31, 2020, after consideration of all tax loss and tax credit carry back opportunities, the Company had tax affected tax loss carry forwards worldwide expiring as follows (in thousands):

2021	$	2
2022		3
2023		183
2024		4
After 2024		11,229
No expiration		9,087
Total	$	20,508

Reserve for Uncertain Tax Positions Rollforward

The tabular reconciliation of the reserve for uncertain tax benefits on a gross basis without interest for the three years ended December 31, 2020 is presented below (in thousands):

Balance as of December 31, 2017	$	3,298
Additions for current year tax positions		3,600
Reductions in prior year tax positions		(2,114)
Balance as of December 31, 2018		4,784
Additions for current year tax positions		—
Reductions in prior year tax positions		—
Balance as of December 31, 2019		4,784
Additions for current year tax positions		2,725
Reductions in prior year tax positions		—
Balance as of December 31, 2020	$	7,509

Jurisdictions Open to Income Tax Examination

Tax Jurisdiction	Tax Year Ended
United States	2017 to present
Australia	2016 to present
India	2015 to present
Canada	2016 to present
Mexico	2015 to present
Philippines	2017 to present