Income Taxes

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company adjusts its effective tax rate each quarter to be consistent with the estimated annual effective tax rate. The Company also records the tax effect of unusual or infrequently occurring discrete items.

The provision for income taxes is shown in the tables below:

	Three Months Ended June 30
	2022		2021
Income tax expense	$	1,799	$	2,484

	Six Months Ended June 30
	2022	2021
Income tax expense	894	2,741

Income tax expense decreased $0.7 million to $1.8 million in the second quarter of 2022 mostly due to a reduction in net operating income.

Income tax expense decreased $1.8 million to $0.9 million in the six months of 2022 mostly due to a reduction in net operating income.

The Company’s effective tax rate was 11.5% before discrete items as of June 30, 2022 and 6.0% as of June 30, 2021. The increase in effective tax rate was primarily due to a decrease in TCJA refunds of excess deferred federal income taxes which was partially offset by an increase in state tax benefits from repairs.

The Company had unrecognized tax benefits of approximately $16.5 million and $14.2 million as of June 30, 2022 and 2021, respectively. Included in the balance of unrecognized tax benefits as of June 30, 2022 and 2021, is $4.2 million and $3.8 million, respectively, of tax benefits that, if recognized, would result in an adjustment to the Company’s effective tax rate. The Company does not expect its unrecognized tax benefits to change significantly within the next 12 months.